Iron Ore Rebound: Cliffs Natural Resources In Focus [View article]
e_blastman, I used to work for one of the top 3 iron ore miners and have a degree of insight into the business... I'll offer a few points.
Price fixing in the iron ore game, whilst obviously possible, would be difficult to achieve in practice unless we saw significant collusion between the the 3 major Iron ore producers (Vale, Rio Tinto and BHP Billiton). Given the sheer size, management and red tape that exists within these giant corporations, I cannot foresee that this would be possible (both practically and legally).
Granted, one of these companies could intentionally restrict supply to a degree - however, with all the major expansions underway at the moment (in particular by Vale and Rio Tinto) there is at present an ever increasing supply. Therefore, I would imagine that any gap in supply resulting from a restriction by one company would simply be taken up by another company - thus net supply remains constant and so to does price.
As you mention, this could instead be achieved through media to some degree - but I believe that manipulating anyone through media to create a perception of lack of supply would be difficult - particularly given the media and publicity surrounding the numerous growth projects/ expansions still going ahead at major IO mining sites.
In relation to Cliffs, it produces a relatively low market share in comparison to the three majors (and also the ever expanding Fortesque Metals Group (FMG) in Western Australia) and therefore I believe that their overall influence in respect to price fixing would be relatively minimal. However, given that they are less diversified than the other miners it makes for some good stock plays on iron ore price fluctuations/ predictions.
Interesting point though, as price fixing also occurs from the buyers side - the recently heavily subdued IO price was largely the result of the steel producers in China intentionally using up all of their excess iron ore at their blast furnaces so to reduce demand and thus price... This was reflected in the negative media of 'IO demand decreases' and therefore declines in the shareprices of IO miners. However, this move by suppliers obviously not long sustained and as they ran out of IO at their blast furnaces, they again started buying, demand increased and as a result the IO price has again reached levels near mid 2012.
Interestingly, this raises another point - with suppliers/ buyers being able to manipulate the price so readily, it makes long term investments in mining stocks very challenging. Can we really do anything but make short term speculations (3-6 month) for these stocks?
France Telecom: Value Stock With A Very Reasonable Dividend [View article]
bg6638, agreed that there are certainly risks associated with this stock - any further reductions in FTE cash flow would certainly result in another dividend cut. The latest announced ~40% dividend reduction was the result of management conceding a not quite 40% reduction in cash flow through 2013 (the remainder is for managing debt). If the management forecast that the business will return to growth in 2014 comes to fruition then it is unlikely we'd see another dividend reduction or significant drop in share price.
Can't necessarily rely on these predictions though, so as you point at someone would have to weigh up the risks or research these more heavily before making the decision to invest - Garthilk also made mention of these risks in his point below...
France Telecom: Value Stock With A Very Reasonable Dividend [View article]
Good points on the taxes everyone, I had neglected to discuss/ explor that in the analysis so thanks for the input. As we can gauge from this conversation, taxes can get complicated and the implications can vary significantly between individuals so it is certainly an additional thing to consider when deciding to invest in this international stock (or any such stocks, for that matter)... Again, thanks!
Billabong: Strong Retail Brands In Turmoil [View article]
I revert - Ended up buying the stock a few weeks weeks ago on the ASX for AU$0.84 and made a good little 15% on it upon the news of 2 new, separate $1.1 takeover bids.
Cameco: Uranium Isn't Dead; In Fact, Demand Will Continue To Grow [View article]
Agree completely. There's at least a few years left in nuclear growth. Beyond 5-10 years, in the very worst case, we will see neutral growth but I believe the more probable case is that growth will continue to occur but simply at a slower rate.
In my opinion, it is unlikely that there is going to be a pronounced retraction of nuclear demand any time in the foreseen future. Whilst nuclear may lose some of its market share to alternative energy sources (such as natural gas) I don't think that this necessarily means a reduced demand for nuclear energy (and thus uranium) as there will undoubtedly be an increased energy demand globally acting as an offset.
I believe Cameco at its current price factors in very little growth in uranium demand AND subdued uranium prices - and realistically, given time, one of these two things will increase. And so to will the stock value (it's already increased >12% in the last month as investors are waking up to this fact!).
Cameco: Uranium Isn't Dead; In Fact, Demand Will Continue To Grow [View article]
Agree completely. There's at least a few years left in nuclear growth. Beyond 5-10 years, in the very worst case, growth will retreat but I believe the more probable case is that growth will slow. In my opinion, it is unlikely that there is going to be a pronounced retraction of nuclear demand any time in the foreseen future. Whilst nuclear may lose some of its market share to alternative energy sources (such as natural gas) I don't think that this necessarily means a reduced demand for nuclear energy (and thus uranium) as there will undoubtedly be an increased energy demand globally acting as an offset.
I believe Cameco at its current price factors in very little growth in uranium demand AND subdued uranium prices - and realistically, given time, one of these two things will increase. And so to will the stock value (it's already increased >12% in the last month as investors are waking up to this fact!).
Android Is Dead - Part 6: Nokia Triumphs [View article]
I agree that Blackberry is dead.
Not sure how it's going to make the comeback anticipated in this article given how much traction it's lost in the mobile space. They have historically relied on corporate users when they offered a superior service for businesses. But they've certainly lost this moat now and their marketshare has eroded accordingly.
I believe they will continue to lose this market share as the lagging, clunky, large multi-national corporations IT departments slowly transition away from Blackberries to the more user friendly (and work efficient) alternatives such as iPhones, Android and Windows Phone. Many (if not most) smaller and more agile companies have already done this.
Coach: Undervalued And Growing Rapidly [View article]
Nice article - I have made a fairly similar analysis of Coach recently with and reached similar conclusion... Let's hope we're right (it's been a shaky last few months!)!
They key question in my mind is: "Can pull off its sustainable growth in China and Japan?". To date, the answer to this question is yes. Lets hope this trend continues.
COH management has executed terrifically to date and I have no doubts in their ability to deliver.
Billabong: Strong Retail Brands In Turmoil [View article]
Mike, what are your thoughts on this stock now, given the new (and several failed) takeover bids - I've purchased a number of ASX listed Billabong stock recently and have confidence that the stock is currently undervalued given its market position.
However, I'd be interested in hearing your thoughts!
Android Is Dead, Part 3: The Numbers [View article]
Does anyone get really tired of reading these kinds of articles of 'doom and gloom', without very little contrary opinion? The number of assumptions you've made here is huge, and your conclusions are highly sensitive to these massive assumptions.
One could easily write an article such as this which could show the complete opposite of your analysis; simply by using a completely different set of (probably equally as valid) assumptions.
Yes, you may be correct. But equally (or probably more likely), you may be incorrect.
Of course, one is entitled to their opinion and to express it, but I just hope no-one is basing investing decisions from reading speculative articles such as this.
France Telecom: Value Stock With A Very Reasonable Dividend [View article]
Iron Ore Rebound: Cliffs Natural Resources In Focus [View article]
Price fixing in the iron ore game, whilst obviously possible, would be difficult to achieve in practice unless we saw significant collusion between the the 3 major Iron ore producers (Vale, Rio Tinto and BHP Billiton). Given the sheer size, management and red tape that exists within these giant corporations, I cannot foresee that this would be possible (both practically and legally).
Granted, one of these companies could intentionally restrict supply to a degree - however, with all the major expansions underway at the moment (in particular by Vale and Rio Tinto) there is at present an ever increasing supply. Therefore, I would imagine that any gap in supply resulting from a restriction by one company would simply be taken up by another company - thus net supply remains constant and so to does price.
As you mention, this could instead be achieved through media to some degree - but I believe that manipulating anyone through media to create a perception of lack of supply would be difficult - particularly given the media and publicity surrounding the numerous growth projects/ expansions still going ahead at major IO mining sites.
In relation to Cliffs, it produces a relatively low market share in comparison to the three majors (and also the ever expanding Fortesque Metals Group (FMG) in Western Australia) and therefore I believe that their overall influence in respect to price fixing would be relatively minimal. However, given that they are less diversified than the other miners it makes for some good stock plays on iron ore price fluctuations/ predictions.
Interesting point though, as price fixing also occurs from the buyers side - the recently heavily subdued IO price was largely the result of the steel producers in China intentionally using up all of their excess iron ore at their blast furnaces so to reduce demand and thus price... This was reflected in the negative media of 'IO demand decreases' and therefore declines in the shareprices of IO miners. However, this move by suppliers obviously not long sustained and as they ran out of IO at their blast furnaces, they again started buying, demand increased and as a result the IO price has again reached levels near mid 2012.
Interestingly, this raises another point - with suppliers/ buyers being able to manipulate the price so readily, it makes long term investments in mining stocks very challenging. Can we really do anything but make short term speculations (3-6 month) for these stocks?
France Telecom: Value Stock With A Very Reasonable Dividend [View article]
If the management forecast that the business will return to growth in 2014 comes to fruition then it is unlikely we'd see another dividend reduction or significant drop in share price.
Can't necessarily rely on these predictions though, so as you point at someone would have to weigh up the risks or research these more heavily before making the decision to invest - Garthilk also made mention of these risks in his point below...
France Telecom: Value Stock With A Very Reasonable Dividend [View article]
Cheers,
Tim
France Telecom: Value Stock With A Very Reasonable Dividend [View article]
As we can gauge from this conversation, taxes can get complicated and the implications can vary significantly between individuals so it is certainly an additional thing to consider when deciding to invest in this international stock (or any such stocks, for that matter)...
Again, thanks!
Billabong: Strong Retail Brands In Turmoil [View article]
Cameco: Uranium Isn't Dead; In Fact, Demand Will Continue To Grow [View article]
Beyond 5-10 years, in the very worst case, we will see neutral growth but I believe the more probable case is that growth will continue to occur but simply at a slower rate.
In my opinion, it is unlikely that there is going to be a pronounced retraction of nuclear demand any time in the foreseen future. Whilst nuclear may lose some of its market share to alternative energy sources (such as natural gas) I don't think that this necessarily means a reduced demand for nuclear energy (and thus uranium) as there will undoubtedly be an increased energy demand globally acting as an offset.
I believe Cameco at its current price factors in very little growth in uranium demand AND subdued uranium prices - and realistically, given time, one of these two things will increase. And so to will the stock value (it's already increased >12% in the last month as investors are waking up to this fact!).
Cameco: Uranium Isn't Dead; In Fact, Demand Will Continue To Grow [View article]
Beyond 5-10 years, in the very worst case, growth will retreat but I believe the more probable case is that growth will slow. In my opinion, it is unlikely that there is going to be a pronounced retraction of nuclear demand any time in the foreseen future. Whilst nuclear may lose some of its market share to alternative energy sources (such as natural gas) I don't think that this necessarily means a reduced demand for nuclear energy (and thus uranium) as there will undoubtedly be an increased energy demand globally acting as an offset.
I believe Cameco at its current price factors in very little growth in uranium demand AND subdued uranium prices - and realistically, given time, one of these two things will increase. And so to will the stock value (it's already increased >12% in the last month as investors are waking up to this fact!).
Android Is Dead - Part 6: Nokia Triumphs [View article]
Not sure how it's going to make the comeback anticipated in this article given how much traction it's lost in the mobile space. They have historically relied on corporate users when they offered a superior service for businesses. But they've certainly lost this moat now and their marketshare has eroded accordingly.
I believe they will continue to lose this market share as the lagging, clunky, large multi-national corporations IT departments slowly transition away from Blackberries to the more user friendly (and work efficient) alternatives such as iPhones, Android and Windows Phone. Many (if not most) smaller and more agile companies have already done this.
Coach: Undervalued And Growing Rapidly [View article]
They key question in my mind is: "Can pull off its sustainable growth in China and Japan?". To date, the answer to this question is yes. Lets hope this trend continues.
COH management has executed terrifically to date and I have no doubts in their ability to deliver.
Fingers crossed!
Billabong: Strong Retail Brands In Turmoil [View article]
However, I'd be interested in hearing your thoughts!
Android Is Dead, Part 3: The Numbers [View article]
One could easily write an article such as this which could show the complete opposite of your analysis; simply by using a completely different set of (probably equally as valid) assumptions.
Yes, you may be correct. But equally (or probably more likely), you may be incorrect.
Of course, one is entitled to their opinion and to express it, but I just hope no-one is basing investing decisions from reading speculative articles such as this.