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  • CF Industries: Inside The Numbers [View article]
    Thanks for the article, Jeff, but I think it is too focused on crunching numbers. I just began looking into this company / industry so please excuse my lack of education in this area. Could you please address the following questions (most of them derived from your article):
    1. You said "Over the past three years, CF Industries has acquired more total assets than total liabilities. This indicates that the company not has been financing its assets through debt." This is simply not true since ST + LT Debt has increased by ~USD1.6 billion over the past 3 years. In the year that it has acquired Terra, total debt has increased by USD2.6 billion.
    2. You need to adjust earnings/cash flow/revenue/asset growth down for the 2010 acquisition, and the non controlling interests associated with Terra (and who knows what else).
    3. Since 2005, operating maring has flucuated between -9% to 57%. You should touch more on any important cycles out there. Obviously food storage and natural gas prices has a lot to do with it + other factors that I am missing. You're focus on 3 year performance is meaningless since it isn't long enough to cover complete cycles.
    4. Good will is $2 billion on a $5.5 total equity position... you're paying a lot per tangible book for a capital intensive company like CF. As a comparision, MOS's is $1.9 billion Goodwill on $13 billin equity.

    I believe my points demonstrate why it is pointless to plug and chug data like you did in your article. Please disagree. Lets continue this converation with facts and reasonings so we can reach a better conclusion.
    Feb 6 06:08 PM | 3 Likes Like |Link to Comment
  • The Bullish Case For CF Industries [View article]
    A few key questions you didn't answer, but I hope you would in a follow up:

    Why is this large, prominent company mispriced by the market?

    What are the risks?

    2 out of 5.5 billion in total equity is in Good Will, so price per tangile equity is actually quite high... does that bother you?

    While past growths have been strong, given the overall GDP equivalent growth of the entire industry, what makes you think it can continue its growth?

    Are there any cyclical risks?

    I'm just beginning to research this company, so please excuse any naive questions.
    Feb 6 05:35 PM | Likes Like |Link to Comment
  • 4 Undervalued Stocks With Stronger Return On Assets Than Peers [View article]
    I read your article and I have the following questions:
    1. Where is the due diligence that you mentioned?
    2. Where is the deep dive into the financials that you mentioned?
    3. How does this add value?
    Feb 6 05:16 PM | Likes Like |Link to Comment
  • Apple: Premium Company, Dirt-Cheap Stock [View article]
    I believe we are on the same page here. I was referring to recent history. As you said, that is 3 explosive innovations between 2001 and 2010, or "one every couple fo years". Some people are saying Apple isn't innovative any more, and the point of the statement is that this kind of expectation is not reasonable.
    Feb 6 03:36 PM | Likes Like |Link to Comment
  • Apple: Premium Company, Dirt-Cheap Stock [View article]
    If you believe AAPL will go to 300, I suggest you short the stock. I think our interests are aligned given 1) I will be a net buyer if prices continues to decrease, and 2) AAPL is a net buyer with their stock buyback program, so it is in my interest that the stock goes down as low as possible. At 300, Apple should aggressively ramp up their repurchase program to $100 billion by selling off market securities (treasuries and such), repatrating foreign cash, leverage their balance sheet (they have amazing cash flow and 0 debt, so they can easily take advantage of the historically low interest rate market).

    Tim Cook, are you reading this? Lets not wait for $300, lets do it now. Announce a 10% one-time special dividend and up your current stock repurchase program by 5x.
    Feb 6 12:16 PM | 4 Likes Like |Link to Comment
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