Shiraz Lakhi

Long/short equity, deep value, value, growth
Shiraz Lakhi
Long/short equity, deep value, value, growth
Contributor since: 2011
Company: tradePilot.com
I think MoneyMachine71 hits the nail on the head - the best advice I received on this was from my teens (and their 'uber-cool' crew) - sure the numbers, management performance (ROIC), and FCF stand up, but a dying brand is hard to resuscitate, the industry moves way too fast to keep up - there are better opportunities/industires out there right this minute, based on the theme/premise that the stock is cheaper / better value than it was yesterday / last week. Good luck )
Need to be brave jumping on board VW right now - could be the best decision (I cannot see much more downside below $90 so some risk - personal opinion) - buying BMW though at deflated levels makes good sense - subj to checking fundamentals / FCF based valuation..
Bought an extra 7,000 @ 4.90 - nice move today re-enforces solid arguments made above - trying to get more selling put options but such a thin market (
I am long short crude / long gasoline dollar neutral - playing the raw crack spread (minus heating oil) - same thesis - also holding Western Refining (WNR) for a longer term play.
Agreed on most points - nice upbeat article on a Monday morning - I have pondered this deep-value play for a while (patience paying off) - could be the right time to put some speculative capital into play here - the only thing you have not mentioned in the article is the minimum-wage pressure knocking at their door - any comments?
Good call - better timed than mine - but nonetheless enjoying big 5.5%+ pay-off on this trade today (without leverage!)...
Long QCOM since my last article here on SA. Been adding to position since @ 65.50 and 63.90 - based purely on agreed IoT growth and competent management. It's one of those no-brainers right now with downside risk limited and significant upside...
I am long COH - just wrote on my instablog today - based on EV/FCF it is one of the cheapest stocks in the consumer sector today, backed by positive outlooks (see ChristopherM122's comments on this stream) which the author has not mentioned in the article. Nobody takes the P/E seriously except the ill-advised retail investor. Let's see how this pans out in 3 months time, vs KORS.
I can't believe a contributory writer at SA takes P/E for face value, without further analysis of more advanced (and thorough) comparable metrics such as EV/EBITDA or better still, EV/FCF. To base an article on such flimsy a metric as P/E is downright dangerous in the context of recommending a short.
The article could have gone into some more depth, but thesis is generally good - considering writing some 26 strike puts on DHI to collect premium / ok to get called/exercised as it is a stock I don't mind owning.
Well done FreeMkts - much better analysis and I agree - there are lots of alternative metrics one can choose (especially Enetrprise Value based) which paints a wholly different picture, than the limited scope comparisons by the author, based on "Same-Store Sales Growth in Most Recent Quarter" - I also see red flags every time P/E is used as a comparative measure - much better to use operating-income (EV/EBIT or EV/EBITDA) or - as you point out EV/Sales... Anyway... you get the point...
I agree - the 'best case scenario' expressed in the entry/strike differential portrays hidden optimism (almost misleading, had it not been for the caveat), rather than reality... should not be in the excel diagrams. I respect the author though, he has done some exceptional (deep detail) articles for specific companies. Regarding options - for me, it's always been a no-brainer to sell/write near-term put options on stocks I want to own (recently example QCOM), as opposed to the more elaborate "long-term, beat the professionals" advocacy portrayed in these type of articles.
Thank you for the positive/constructive comment - yes absolutely, the P/E compression analysis over time is something I have used extensively in my portfolio picks, and am looking at developing further in my stock screener / chart engine - with a 3-5 year look-back period - the screener will also include historical perspective - 5 year charts - on other key ratio's (Price/EBIT, Price/EBITDA, Price/FCF, Price/Book AND Price/Tangible-Book, EnterpriseValue/EBIT, EV/FCF). This will be a valuable feature/impetus for visual analysis of specific companies (similar to QCOM) with compressed P/x (or EV/x) ratio's across varying time periods.
Thanks for the positive feedback - I am humbled. Bought QCOM today / filled between 74.40-74.44 (additional pullback was a bonus) - time will tell if this pays off - quietly confident...
Don't get me wrong - I am not in any way playing Apple down, or advocating negativity. Apple has surprised time and again, is likely to continue doing so, and competitors are quietly humbled by the standards this brand sets across the industry. The point I want to get across is - at the current valuations relative to recent quarters, at least in the short term, the current stock price has likely priced in all expectations of record sales in Q4.
Forgive me if I sound flippant (sincerely not intended) - but with every investment there is a risk. Successful investor apply calculated risk to their investments, such as hedging during broader market uncertainty. In this case, of course if NFLX goes up and AAPL down, then the trade will produce a loss. The object, in the spirit of the article, is to place the probability of a successful trade (the edge) in our favor. Respectfully, Shiraz
I could not agree more. Respectfully, Shiraz
Absolutely - it is shooting up as we speak...
Well, on this occasion NCT hit the mark. NCT shot up over 27% Friday. I maintain, the best fundamental indicator I know and use daily has to be the Free Cash Flow To Enterprise Value. Looking at "RUTH" and "TNAV" entries Monday, based on same principle.