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  • Pitney Bowes Is A Ticking Time Bomb [View article]
    The company may have a good 2013, but my argument is focused more long-term. I believe eventually its large cash outflows will catch up to it.
    Jan 15, 2013. 09:15 AM | Likes Like |Link to Comment
  • Pitney Bowes Is A Ticking Time Bomb [View article]
    I would have to agree. The company could add substantial value if it cut the dividend, and used that money to get rid of some of its debt. On the other hand, I believe there is very little chance the company will be able to keep paying that large dividend for 8 years at its current income level.
    Jan 15, 2013. 09:13 AM | 1 Like Like |Link to Comment
  • EZCorp Filled With Value [View article]
    I don't believe he would either. I was just saying it isn't completely out of the question.
    Jan 15, 2013. 09:02 AM | Likes Like |Link to Comment
  • Pitney Bowes Is A Ticking Time Bomb [View article]
    Hypothetically, if they did largely cut their dividend and began investing more in themselves, I might be more interested. The reason I'm short is because I believe there little to no chance they do so until they run out of the necessary capital at the last second. When they do, I believe investors' pessismism will increase even more, they will begin to realize there's many more problems with the company, and that will lower the price even more. At that point, when the company is forced to reconsider their finances, that may cause me to change my mind. In brief, I'm short because I feel there's a large possibility that the aforementioned event will happen soon.
    Jan 15, 2013. 08:57 AM | Likes Like |Link to Comment
  • Pitney Bowes Is A Ticking Time Bomb [View article]
    Yes, I see how you could be viewing it as a cigar butt. I'm normally against that type of investing, but I do know Buffett and Graham once used that approach. It's tough with PBI because you don't know when their earnings could fall apart. One bad year could be a trigger for the whole thing. You had a very well written article, by the way. I think you got too much heat in your comments for one spelling mistake. One spelling mistake doesn't diminish the quality of a whole article. I thought it would be a good idea to post my own article from a longer-term investor's standpoint. From a short-term 'cigar-butt' standpoint, I believe it is a bit too risky for me, but I obviously recognize the large discount it is trading at.
    Jan 15, 2013. 08:50 AM | Likes Like |Link to Comment
  • Pitney Bowes Is A Ticking Time Bomb [View article]
    I was trying to place my focus primarily on the size of the dividend payments, rather than the yield, by using its payout ratio. The reason I may go short is because I believe, in the near future, the company won't be able to keep up with and its payments and support a dividend. When a company pays out over 90% of their earnings, they leave little left to grow the business. Right now, the company could use alot more of that money to find different ways to grow, or different niches to enter. Sure the company may have a dominant market share, but they're in a slowly declining business. Its like what Buffett said, "id rather have an excellent company at a fair price, than a fair company at an excellent price"
    Jan 15, 2013. 08:06 AM | Likes Like |Link to Comment
  • EZCorp Filled With Value [View article]
    Plus Cohen's a big M&A guy, and has all the tools necessary for transaction that could heavily benefit him.
    Jan 14, 2013. 10:11 PM | Likes Like |Link to Comment
  • EZCorp Filled With Value [View article]
    It hasn't affected the company so far. As I said earlier, same store sales growth would be an effective tool to measure if the shops are losing customers to banks. Same store sales growth is currently around 3-4%. Gold has a slight impact on earnings. When the shops buy gold jewelry from customers, they usually pay an amount less than currently scrap value. Therefore, the only risk is the difference in gold price from when they buy it, to when they sell it. Since the company already purchases the gold at a lower percentage than scrap value, they already have a margin of safety.
    Jan 14, 2013. 08:44 PM | Likes Like |Link to Comment
  • EZCorp Filled With Value [View article]
    Same-store sales growth is always something to keep notice of. If that number starts declining, then the company may be growing too fast. EZCorp's was about 3%-4% this year I believe.
    Jan 14, 2013. 06:46 PM | Likes Like |Link to Comment
  • EZCorp Filled With Value [View article]
    I would have to agree. Management has done an excellent job so far, and unless Mr. Cohen begins to abuse this contract, the company should continue to add shareholder value.
    Jan 14, 2013. 06:06 PM | Likes Like |Link to Comment
  • EZCorp Filled With Value [View article]
    The reason I don't mind this is the company has grown net income by similar measures (19% this year, 25% the year before, 43% before that). If income doesn't keep pace with the growth in annual fee, I will also begin to feel your concerns. For the time being, the consultants have justified their increase in fees.
    Jan 14, 2013. 04:33 PM | Likes Like |Link to Comment
  • EZCorp Filled With Value [View article]
    I don't believe so. Here's the quote from the 10-K, "For each of the past three fiscal years, we have entered one -year financial advisory services agreements with Madison Park, LLC, a business and financial advisory firm wholly-owned by Phillip E. Cohen, the beneficial owner of all of our outstanding Class B Common Stock, pursuant to which, Madison Park provides advisory and consulting services with respect to our business and long-term strategic plan, including acquisitions and strategic alliances, operating and strategic objectives, investor relations, relations with investment bankers and other members of the financial services industry, international business development and strategic investment opportunities, and financial matters. The annual fee for the services was $6.0 million in fiscal 2012, $4.8 million in fiscal 2011 and $3.6 million in fiscal 2010. Effective October 1, 2012, we entered into a new financial advisory services agreement with Madison Park with a one -year term that expires September 30, 2013. The terms of the agreement are substantially the same as those in the fiscal 2012 agreement described above, except the annual fee is $7.2 million."

    It seems to be a fixed, annual fee, which is much better than being variable and based off of revenue growth. Although, I wouldn't be honest if I said that slightly didn't bother me.
    Jan 14, 2013. 03:50 PM | Likes Like |Link to Comment
  • EZCorp Filled With Value [View article]
    Regulations include the time period of loans, size of the loans, and how high of an interest rate pawns shops can charge(not in Mexico though). With the high rates they already charge, I can't imagine these regulations are too strict. The biggest concern is customer demand. If banks become more leinent to lend, the pawn-shops could lose business. The 2008 crash obviously provided a huge boost to pawn-shops as banks stopped lending. The shops could lose business to banks or credit unions as the industry recovers from the crisis.
    Jan 14, 2013. 03:26 PM | Likes Like |Link to Comment
  • EZCorp Filled With Value [View article]
    Thank you! I believe the value of all their acquisitions will catch up to them in the long-term. The Latin-American market also has yet to be fully tapped, and EZCorp is in an excellent position to do so. I think analyst's will begin to lower their estimates after the company's past misses, and eventually EZCorp will beat them. Only time will tell.
    Jan 14, 2013. 02:57 PM | Likes Like |Link to Comment
  • Coach: Undervalued And Growing Rapidly [View article]
    I'm quite happy about the gain too. Unfortunately Coach tends to be very volatile, and can drop down 4% another day. Let's hope earnings gives them a good boost.
    Jan 14, 2013. 10:46 AM | Likes Like |Link to Comment
COMMENTS STATS
69 Comments
36 Likes