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Randall Hsu, CFA  

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  • Sears CFO Setting The Record Straight: 'Just The Facts' [View article]
    In November 2003, Sears formed a Real Estate Mortgage Investment Conduit, or REMIC. The real estate associated with 125 Full-line stores was contributed to indirect wholly owned subsidiaries of Sears, and then leased back to Sears. The contributed stores were mortgaged and the REMIC issued to wholly owned subsidiaries of Sears (including Sears Re) $1.3 billion (par value) of securities (the "REMIC Securities") that are secured by the mortgages and collateral assignments of the store leases. Sears RE could resell that and fetch $1.3 billion or maybe more or less. Anyways, I did not understand the relevancy of that $2.25bn loan or the fact that all JCP's properties are being collateralized.
    Sep 21, 2014. 12:20 PM | Likes Like |Link to Comment
  • Sears CFO Setting The Record Straight: 'Just The Facts' [View article]
    Article on Sears Holdings
    Sep 21, 2014. 11:51 AM | Likes Like |Link to Comment
  • Sears CFO Setting The Record Straight: 'Just The Facts' [View article]
    JCP has about ~1,100 stores, of which ~430 owned, including ~120 on ground leases. Pershing pegged it at $11bn replacement cost in 2012. So assume that is true, then the value/loan ratio is about 5 to 1 ratio.

    SHLD does not disclose which 25 stores as collaterals, but it would make sense that's probably the top 25 unencumbered stores. Baker street assumed the top 100 stores can fetch $2.8b and pointed out that Sears sold its Ala Moana 340k square feet lease back to GGP in 2012 for $250 million (mall sales $735/sqft). So let's say we lower that and say on average the top 25 stores can fetch $80 million, that will be $2bn for a $400 million loan, or ratio about 5 to 1 or maybe 4 to 1 if you assume a lower value, depending on how you like to slice it.

    So I am not too sure how is that different.
    Sep 21, 2014. 11:37 AM | Likes Like |Link to Comment
  • TARP Warrants Revisited In 2014: Opportunities Still Exist For Long-Term Investors [View article]
    Yes, the dividend ex-date was Sep 3, so it will be downward adjusted by this amount.
    Sep 4, 2014. 12:05 AM | Likes Like |Link to Comment
  • TARP Warrants Revisited In 2014: Opportunities Still Exist For Long-Term Investors [View article]
    http://seekingalpha.co...

    You can see the chart in my Dec 2011 article, it contained the implied volatility calculated by the US Treasury and compare that vs. today based on your own calculation.
    Sep 3, 2014. 08:55 PM | Likes Like |Link to Comment
  • TARP Warrants Revisited In 2014: Opportunities Still Exist For Long-Term Investors [View article]
    http://bit.ly/1u1V7Wo
    Sep 3, 2014. 08:51 PM | 1 Like Like |Link to Comment
  • TARP Warrants Revisited In 2014: Opportunities Still Exist For Long-Term Investors [View article]
    Yes, I made a mistake on the expiration date for BAC.WS.A. It expires in Jan 2019, not 2018.
    Sep 3, 2014. 08:50 PM | Likes Like |Link to Comment
  • Pessimism On SodaStream's Prospects In The Americas Market Is Overblown [View article]
    Seth, thank you for your comment. SDS’ “Viberation” system is the only one that I know. Could you please let me know if there are other alternatives?

    It's unlikely that one particular system will dominate the at-home category. So the question to ask is: "which system will dominate within a segment that comprised most of users?"

    Consumers do not value taste quality and health benefits as highly as surveys suggested. For example, new coke vs. old coke, with new coke scoring much higher on taste surveys, and SodaStream's emphasis on health benefits has yet to push sales.

    Cylinder-free carbonating devices are very exciting and will have many users that rave about them. However, the overall category is dominated by users that want bubbly water with ease and value and be able to customize the drink to how they want it. Cylinder-free carbonating might run into issues related to those factors to achieve a mass appeal.
    Aug 19, 2014. 11:38 AM | Likes Like |Link to Comment
  • TARP Warrants Revisited Part 2: Opportunities Exist For Long-Term Investors [View article]
    Hi Stephen, the chart in this article includes institutions with TARP auction proceeds greater than $50 million.

    So that excludes SunTrust, as well as Boston Priviate Financial, First Financial Bancorp, Signature Bank, Sterling Bancshares, TCF Financial, Texas Capital Bancshares, Valley National Bancorp, Washington Federal, Webster Financial, Wintrust Financial.

    As you can see, the list is quite extensive, so my goal is to cover these smaller, less liquid TARP warrants in a separate article.
    Jun 5, 2012. 09:33 AM | Likes Like |Link to Comment
  • Wells Fargo's Economic Moat And Valuation Make The Company An Attractive Investment [View article]
    You have rightly pointed out the costs of running a bank in any given year, but please take a look at this Economist article (http://econ.st/Leldhn) because it shows the average annual return on equity for the US Banking industry in the last 130 years or so, an impressive accomplishment.

    In my other article (http://seekingalpha.co...), I mentioned this accomplishment and that the US Banking industry continues to generate impressive returns despite a growing asset base and disruptive innovation.

    To do well in investing is all about finding opportunities that can compound at a satisfactory rate of return for a long period of time. Therefore, in order to achieve that goal in stock investing, we need to understand the certainty of a business's long-term characteristics, the certainty of the management team to deploy capital intelligently, and our purchase price in stock ownership.

    I hope you would agree that Wells Fargo has clearly demonstrated its attractiveness with all the above points. Thanks!
    May 9, 2012. 01:41 PM | Likes Like |Link to Comment
  • U.S. Commercial Banking Industry's Brighter Future [View article]
    You have rightly pointed out the costs of running a bank in any given year, but please take a look at this Economist article (http://econ.st/Leldhn) because it shows the average annual return on equity for the US Banking industry in the last 130 years or so, an impressive accomplishment.

    In my other article (http://seekingalpha.co...), I mentioned this accomplishment and that the US Banking industry continues to generate impressive returns despite a growing asset base and disruptive innovation.

    To do well in investing is all about finding opportunities that can compound at a satisfactory rate of return for a long period of time. Therefore, in order to achieve that goal in stock investing, we need to understand the certainty of a business's long-term characteristics, the certainty of the management team to deploy capital intelligently, and our purchase price in stock ownership.

    I hope you would agree that Wells Fargo has clearly demonstrated its attractiveness with all the above points. Thanks!
    May 9, 2012. 01:39 PM | Likes Like |Link to Comment
  • TARP Warrants Revisited: Opportunities Exist For Long-Term Investors [View article]
    I listed out the auction dates for each of the warrants listed here.

    You would go to the corporation's respective sec filings on or after that date and look for form 8 (Registration of securities) to get the warrant agreement.

    As an example, here is Bank of America's TIP warrant agreement:

    http://1.usa.gov/HDVehp

    and here is the 8K that described about the event:

    http://1.usa.gov/HDVbCp
    Apr 12, 2012. 02:25 AM | Likes Like |Link to Comment
  • TELUS: Excellent Value for a Canadian Telecom Company [View article]
    Update: As of Jan 2012, TELUS is no longer a buy at this price compare to the value an owner would be getting.
    Jan 15, 2012. 01:30 PM | Likes Like |Link to Comment
  • TARP Warrants Revisited: Opportunities Exist For Long-Term Investors [View article]
    TIP and CPP are acronyms for Treasury's TARP initiatives. TIP is Treasury's Targeted Investment Program and CPP is Capital Purchase Program. These warrants are similar to regular warrants, except the long dated nature and downward adjustment to the exercise price when a common share dividend is issued.
    Dec 25, 2011. 11:18 AM | Likes Like |Link to Comment
  • Vicon Presents a Challenge to Value Investors [View article]
    I was looking at this company too, spotted in value line.

    The issue is that the company made no progress in the last 10 years.

    Back in 2000, it was just as cheap as now, liquidation value wise. Almost identical sales, retained earning, asset-value, and the business is likely way more competitive now.

    VII had a great run in 2007, but investors might be stuck in a value trap for awhile. Just my 2 cents.
    Jun 10, 2010. 12:12 AM | Likes Like |Link to Comment
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