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Simon Moore, CFA

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  • Speedway Motorsports Could Be Poised To Double [View article]
    Fair point Vince, that's an interesting perspective and it's hard to prove that one way or the other. Personally, my belief is that though there will be good and bad seasons, NASCAR isn't in secular decline and will remain up there with the NFL as one of the most broadly popular sports. And even though the in home experience keeps getting better, I'd draw a parallel with movie theaters there, because clearly TV has got much better relative to movies over time, but people still go for the experiential/communal element and I believe the same's true of NASCAR.
    Jan 31, 2012. 12:48 AM | 1 Like Like |Link to Comment
  • 3 Diverse Ideas For A 4%-Plus Dividend Yield [View article]
    Yes, I think you're absolutely right per the company's presentation An incremental +$0.80 in dividends (expected) from Phillips 66 post-split. However, you only get 1 share for every 2 COP shares, hence +$0.40 on the dividend to $3.04 total or 4.3% on the current ($70) price. I'm pushing that correction through the system now, thanks for flagging it.
    Jan 25, 2012. 01:33 PM | Likes Like |Link to Comment
  • Speedway Motorsports Could Be Poised To Double [View article]
    S&P have them BB rated. They are paying about 8.2% for 2010 (interest cost/end of year debt) and have EBITDA of $535M for 2010 relative to $630M of debt.
    Jan 24, 2012. 10:58 PM | Likes Like |Link to Comment
  • Research-Based Equity Positioning For February [View article]
    Fair point, a lot of the research on the topic is a bit dated. However, even if your direct costs (i.e. what you paid your broker) were literally $0, then you'd still hit hidden costs in terms of bid/ask spreads and market impact costs (i.e. moving the share price), plus of course taxes as you mention.
    Jan 24, 2012. 05:56 PM | Likes Like |Link to Comment
  • Using Brand Values To Pick Stocks [View article]
    It's a pretty small sample set to start drawing those sorts of inferences, because even within the 100 companies, not all have public equity.
    But to summarize in terms of sector effects, manufacturing tended to look relatively expensive from a brand perspective and technology looked relatively cheap. The other sectors that had multiple names on the list primarily consumer, automotive and financial had no discernible pattern,.
    Jan 21, 2012. 08:53 PM | Likes Like |Link to Comment
  • Using Brand Values To Pick Stocks [View article]
    I'm not sure that difference you're highlighting means "not correct" it means inconsistency between what Interbrand's believes NOK's brand is worth and the market's valuation. Switching from debt to net debt just makes the difference more acute.

    For 97 of the 100 companies on the list Interbrand comes up with a value that is well aligned with you'd expect given the EV for the company, here I'm highlighting the 3 where there's a relative gap. If all 100 were all off and Interbrand weren't a leading player in brand consulting, I'd be more dismissive, but in this case I think it's a useful data point to consider, and perhaps about as scientific as you can get with something as emotional as a brand.
    Jan 20, 2012. 06:48 PM | 1 Like Like |Link to Comment
  • A Once-In-A-Decade Buy In Corporate Bonds [View article]
    Thanks for the article, certainly direct bond investment can present broader opportunities than equity alone, but are you sure about this statement as it relates to Geokinetics?

    "The good news – the sell-off has nothing to do with the credit worthiness of the bond issuers."

    I was just looking at the newsflow of of GOK (ticker for Geokinetics), they have potential legal liability after a fatal accident in September which has lead to a credit rating downgrade, they have negative earnings and negative book equity and they recently issued more debt. I'm not claiming to be an expert on the company, that's just the results of a few minutes of analysis, but I'm not sure lack of market liquidity is necessarily the main driver, the stock is off 77% over the past year. I realize you're talking about a bond not an equity investment, but are your sure there is sufficient equity cushion there? I suspect bond investors might be getting worried about default risk and what they'd recoup in the event of default, rather than more technical liquidity issues.

    To be clear, I haven't looked enough to advocate a position in either direction, but suspect there's more to Geokinetics than just a potential liquidity issue and company specific issues/risk should be examined.
    Jan 20, 2012. 03:59 PM | 8 Likes Like |Link to Comment
  • Salesforce: Fairly Valued But Watch Revenue [View article]
    It's certainly true that negative earnings are a concern, but generally I find cashflow to be a more reliable indicator than earnings. For example, I worry more about a stock with positive earnings and negative cashflow than the reverse.

    Clearly, I didn't explain the 12-17% growth point well, but the logic is this:
    1. Companies on similar multiples to CRM have delivered growth in the 12-17% range for the past 5 years. (If you reject Green Mountain or Whole Foods as comps given the industry differences, then focus on Tipco and Citrix).
    2. Past growth is one of the better proxies we have for future growth.
    3.Therefore, if Salesforce can continue to deliver growth in this 12-17% range or higher, multiple contraction is unlikely
    4. Sales are not slowing and growth for Salesforce is in the 30% range, therefore a stock decline is unlikely until that growth number declines.
    Jan 19, 2012. 01:43 PM | Likes Like |Link to Comment
  • Salesforce: Fairly Valued But Watch Revenue [View article]
    Thanks, I'd broadly agree with that and the insider ownership observation is worth noting, Seeking Alpha doesn't have a "dead money" category, which is really what I'm arguing for with Salesforce given many other alternative stocks out there with meaty valuation upsides. Clearly, Salesforce's growth will ultimately slow, but the point I'm making in comparison with similar stocks is that the market is currently willing to pay that multiple for growth, and Salesforce's growth is not yet slowing.
    Jan 19, 2012. 01:30 PM | 1 Like Like |Link to Comment
  • Carnival: 16% Decline Insufficient After Disaster [View article]
    We'll see what the outcome of the legal proceedings are, but so far my perception is that the press has really focused on the Costa brand rather than the overarching Carnival brand, so I wonder how aware the person on the street is that Carnival is the ultimate corporate entity here. If they aren't, a potential passenger could switch from, for example, Costa to P&O and Carnival overall would be relatively insulated given they own both.
    Jan 19, 2012. 01:21 PM | Likes Like |Link to Comment
  • E-Trade: Don't Throw The Baby Out With The Bathwater [View article]
    Thanks for the points. You are right that I may be being conservative on the bank valuation (points 3,4,5 and 6), and that could be a source of upside to my valuation. We are in agreement that the stock is cheap.
    On points 1 and 2, since this is basically a sum of the parts valuation my goals is not to forecast the bank's income statement.
    Jan 15, 2012. 04:14 PM | Likes Like |Link to Comment
  • Aircastle: Sustainable 4.5% Yield And $17 Price Target [View article]
    Glad you found it useful, the issue with FLY is they've recently done a significant acquisition which increases their fleet size and changes their financials substantially. I'm not saying it's a good or bad thing, but it complicates the picture, if I'm able to find sufficient information I'll do the analysis.
    Jan 13, 2012. 01:49 AM | Likes Like |Link to Comment
  • E-Trade: Don't Throw The Baby Out With The Bathwater [View article]
    The $330M is not a net income projection for 2011. I'm specifically backing out the banking numbers entirely (but leaving in corporate costs and other costs) from the most recent 10-Q and pro-rating from 9 to 12 months to get brokerage for the full year. I'm not making a 2011 net income forecast, but it's a fair bet it will be significantly worse than $330M due to banking provisions.

    The comp multiples for SCHW and AMTD are out of Google Finance based on Revere data.
    Jan 13, 2012. 01:26 AM | Likes Like |Link to Comment
  • E-Trade: Don't Throw The Baby Out With The Bathwater [View article]
    Interesting, Ameritrade ($600 for $250k+ and free trades) and Fidelity ($500 for $300k+) both have similar offers in terms of cash back for opening an account, but E*Trade does seem to do it on a grander scale.
    In terms of management incentives, the precise drivers of the CEO's bonus are not disclosed in his contract which was in the May 2010 10Q, but he typically gets more in stock than cash and bought just under a $1M shares last August, so I suspect he's pretty well aligned with shareholders, but don't have the precise details.
    Jan 12, 2012. 10:24 PM | Likes Like |Link to Comment
  • E-Trade: Don't Throw The Baby Out With The Bathwater [View article]
    A few people have mentioned the strategic review process and E*Trade's decision not to sell (or lack of decent offers). At the Goldman Sachs conference last month E*Trade's CEO discussed the process in this deck.
    Jan 12, 2012. 10:00 PM | Likes Like |Link to Comment