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Stock Market Mike

 
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  • More Than A Ray Of Hope For Sun Communities [View article]
    Interesting pick, Brad. I like this a lot better than homebuilders. Full time employment is still much lower than in the past - a lot of people are scraping by on part time work. Cheaper homes are going to be in-demand for a while!

    -Mike
    Oct 28 03:05 PM | Likes Like |Link to Comment
  • Is American Realty Capital Properties A 'Sucker Yield' Bet? [View article]
    Shift+F5... force reload. Usually does the job.

    -Mike
    Oct 28 11:47 AM | Likes Like |Link to Comment
  • Is American Realty Capital Properties A 'Sucker Yield' Bet? [View article]
    PFF takes the hassle out of owning preferreds. Probably a lower return, but for someone that doesn't have the time or desire to research specific issues, it provides diversification & safety. You're basically hiring people with more insight than yourself to get the job done. You just pick the allocation size.

    -Mike
    Oct 28 11:33 AM | 2 Likes Like |Link to Comment
  • Mr. Buffett: Why Don't You Invest In REITs? [View article]
    He'll go for anything on-sale, but REITs are a far cry from on-sale right now.

    I suspect if rates did eventually rise rapidly, we'd see a lot of REITs cratering by about 40-80%, just like oil stocks have done over the past couple months.

    http://yhoo.it/1FQlyUL;c=
    http://yhoo.it/1FQlxA0;c=

    Then he'd scoop them up en masse, pay back all their debt, and enjoy owning quality real estate holdings as inflation and rates tick upward.

    So... he'd likely be a buyer of VTR or O at $20-30, if it ever got to that point.

    -Mike
    Oct 27 12:05 PM | 1 Like Like |Link to Comment
  • Will Penn West Survive The Free Fall In Oil Prices? I Think So [View article]
    Might just be your brokerage not bothering to submit the forms necessary under our tax treaty. Have you looked into that?

    I get charged 15% WHT on US holdings (I'm in BC, Canada), but can usually claim it back at tax time.

    -Mike
    Oct 27 11:54 AM | 1 Like Like |Link to Comment
  • Semi-Custom Segment Will Help AMD Grow [View article]
    "Buying ATI was a gift for them. With out it AMD would be bankrupt by now. "

    They should've bought ATI entirely with stock, though.

    -Mike
    Oct 27 11:15 AM | 1 Like Like |Link to Comment
  • Ventas Is Continuing To Build A Powerful Brand Of Dividend Repeatability [View article]
    I doubt any of its price movements are caused by shorts. The % sold short is minimal compared to the outstanding shares... under 5%.

    REITs don't usually issue special dividends, except for the occasional catch-up dividend (90% rule) - it attracts the wrong crowd. Most would prefer to continually and gradually reward long-time holders/investors. I personally feel that debt should be dealt with before issuing special dividends.

    -Mike
    Oct 27 10:43 AM | Likes Like |Link to Comment
  • Ventas Is Continuing To Build A Powerful Brand Of Dividend Repeatability [View article]
    He generally only buys on pullbacks.

    -Mike
    Oct 27 10:38 AM | Likes Like |Link to Comment
  • Bovespa on watch as Rousseff squeaks by [View news story]
    After the dump that will surely happen, there will likely be a rebound. Keep in mind that PBR announced lower rates going forward for offshore drillers. They're reigning in costs. If oil prices rise in 2015, that would also benefit the stock.

    This election has drawn attention to some good stocks over there... VALE and PBR are the two that I've learned about. Never hurts to have more investors interested, even if the election outcome wasn't what most investors were hoping for.

    -Mike
    Oct 27 12:31 AM | 4 Likes Like |Link to Comment
  • A Few Reasons To Be Cautious On ExxonMobil [View article]
    I'm inclined to go for higher risk stocks with greater reward potential when there's danger like the above.

    Take XOM... if everything goes well in Russia and oil prices rebound, we have upside of about 25%, yes? ($120/share) Surely worthy of 5% of a well diversified portfolio?

    Unfortunately if oil prices stay repressed and their growth initiatives never get off the ground, that could shock the stock. I've seen stocks go down 40% over and over from shocks... I think theirs might be more resilient, but in 2010 the low was in the mid $50's, and in 2011 it was just below $70. Lets say $70 in an oil bear market, so a decline of 25% or so.

    NADL is the partner company to XOM and Rosneft for the Russia drilling. They pay a 16-17% dividend (5.6x as much) and have upside to $15-20/share from Russia drilling, if that goes through. Risk is potentially going bankrupt without those contracts, although I'd argue that Harsh Environment drilling will be in demand somewhere, if not Russia, and they'd cut their dividend rather than going bankrupt. Still, lets say downside of 100% just to keep things level.

    Bull: $1000 in NADL (175 shares) could be worth $3000 in a few years (2017), while paying out roughly $504 in dividends. (on zero dividend growth)
    Bear: $1000 in NADL (175 shares) could be worth $0 in a few years, while paying out roughly 4 dividend payments - $168

    Bull: $5000 in XOM (53 shares) could be worth $6300 in a few years (2017), while paying out roughly $470 in dividends. (div growth continues - avg $0.74 over 12 quarters)
    Bear: $5000 in XOM could be worth $3710 a few years from now, while paying out roughly $438 in dividends. (div frozen at $0.69)

    I'd rather have $1000 in NADL than $5000 in XOM. It's my Russia play. I treat it like a call option - cap downside and leverage upside, but don't put too much in.

    -Mike
    Oct 26 02:04 PM | 1 Like Like |Link to Comment
  • Chicago Bridge & Iron: Has The Market Overreacted To Its Troubles? [View article]
    Very interesting article. I appreciate how much detail you put into that. Calculating fair value is not one of those things that I do terribly well, so having it all laid out and easy to understand made for a good read. Keep it up!

    -Mike
    Oct 25 06:25 PM | Likes Like |Link to Comment
  • Making Money By Remaining Calm While Others Panic [View article]
    I don't time the market, but I do react when I see massive 6-12% down days on some of my favourite stocks. I also react when I see signs of a turnaround.

    I wasn't too confident, though, or I'd have been buying additional shares and call options rather than just covering shorts.

    I did buy 2 additional CBI call options with a few thousand that I had lying around, but that hardly counts as a move. :P

    -Mike
    Oct 25 12:34 PM | Likes Like |Link to Comment
  • Is American Realty Capital Properties A 'Sucker Yield' Bet? [View article]
    "If a company could manipulate it's shares, why not force it to $18 (in ARCP's case) or $20?"

    Why not? Unfortunately they're forcing it lower with their actions.

    "A company has little control over what the market determines the stock price is. Thank goodness."

    But they can control how they treat their shareholders, and equity raises are part of the equation. If I buy shares and the price rises afterwards, and then they issue equity, I feel like "Oh, this might be a good time to buy a few more shares that I wanted." - other buyers feel like "Oh, now might be a safe time to get in, 2% below the offering price", putting a floor under the stock.

    Conversely, the price falls with no equity raise in sight. Management reiterates that it won't happen. And then they issue it at about a 10% discount at the lowpoint just when a rebound starts, slapping shareholders in the face. The floor has also been moved far lower by such actions, and it actually happened.

    Companies do have to consider investor psychology/sentiment for their stocks to be successful. It's not the main thing, but it is another piece of the equation. Just look at AAPL if you want a fine example - executing as well as last year, but at roughly twice the share price. Investor sentiment matters.

    "If someone came to you with an offer to sell a $250,000 house to you for $125,000"

    Or conversely, if you own a $250k house and put it up for that price, and the offers start coming in at $235k... then $210k... then $200k... you say screw it and sell for $175k, because you really want a different home instead? After all, the different home is in a better state, and 25 years down the road it'll be worth more? That clearly justifies selling $75k below your minimum?

    By the way, your former neighbours are now pissed, because their home values dropped based on the decreased selling price of yours.

    "Sometimes you need to grab the gold ring and pay the ride operator a little more to get it, if the rewards down the road are worth doing so."

    The best thing that they could've done would've been matched maturity debt. 25yr ~5-6% senior unsecured notes. Would've sent a strong signal to the market... the spread between the Red Lobster cap rate and fixed rate debt would've paid the whole thing off within that timeframe.

    -Mike
    Oct 24 05:05 PM | 1 Like Like |Link to Comment
  • Shares Of JAKKS Pacific Are Poised To Triple [View article]
    Weird trading behaviour. Someone big didn't like the report. This is why stop losses are sometimes useful - to lock in profits.

    -Mike
    Oct 24 03:38 PM | Likes Like |Link to Comment
  • Semi-Custom Segment Will Help AMD Grow [View article]
    Honestly, this year and next look like 2012/2013 for Intel. Nothing was happening until 14nm in 2014. 2016 is when stuff starts to happen for AMD. AMD could definitely rise into the $3's if they have a spectacular quarter, but at this point I'd be unwinding far OTM call options rather than purchasing them. There's nothing earth shattering ahead for quite some time. They're purely a trader's stock for the time being.

    -Mike
    Oct 24 12:31 PM | 1 Like Like |Link to Comment
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