Comments on Value Investing Congress' articles RSS Syndication from SeekingAlpha.com http://seekingalpha.com/author/value-investing-congress/articles http://seekingalpha.com/article/129334-what-created-market-misunderstandings-about-lamar-advertising?source=feed#comment-454026 454026 have you ever thought practically about the fact that billboards > don't wear out? you can have a negative tangible book value on the > balance sheet and still have a very valuable billboard company. in > fact most of the private companies in the industry have had upside > down balance sheets for ages. accounting and economic value do diverge > when economic depreciation is different than accounting depreciation.]]> Mon, 06 Apr 2009 17:39:32 -0400


On Apr 03 04:14 PM billboard guy wrote:

> have you ever thought practically about the fact that billboards
> don't wear out? you can have a negative tangible book value on the
> balance sheet and still have a very valuable billboard company. in
> fact most of the private companies in the industry have had upside
> down balance sheets for ages. accounting and economic value do diverge
> when economic depreciation is different than accounting depreciation.]]> http://seekingalpha.com/article/129334-what-created-market-misunderstandings-about-lamar-advertising?source=feed#comment-451941 451941 Sat, 04 Apr 2009 21:07:42 -0400
While I'm sure there are some who came to their negative conclusions based on these factors, you may be underestimating the more human aspects. There are a great many so called investors who simply can't get beyond Q1 revenues feared to be down 15%, especially when accompanied by "questions" about LAMR possibly violating covenants. In other words, fear and momentum are as important these days as fundamentals in understanding recent performance.

You obviously did your homework. Thank you.

And for the record, I think "billboard guy" nailed it as well.]]> http://seekingalpha.com/article/129334-what-created-market-misunderstandings-about-lamar-advertising?source=feed#comment-451622 451622 Sat, 04 Apr 2009 10:09:02 -0400
My reason for not investing in the co,. is the Reilly family. I have doubts if they are really managing this co for the long term. They have already made a ton of money over the years from this company. How inspired are they to really increase shareholder value and not just maintain control and collect their salaries? Take a look at the share structure, which ensures the family's control.


That said I'd like to own the assets, but I'm unwilling to take the Family and the debt to get them...2 cents]]> http://seekingalpha.com/article/129334-what-created-market-misunderstandings-about-lamar-advertising?source=feed#comment-451217 451217 Fri, 03 Apr 2009 16:14:43 -0400 http://seekingalpha.com/article/129334-what-created-market-misunderstandings-about-lamar-advertising?source=feed#comment-451060 451060 Fri, 03 Apr 2009 14:06:29 -0400 http://seekingalpha.com/article/129334-what-created-market-misunderstandings-about-lamar-advertising?source=feed#comment-451055 451055 Fri, 03 Apr 2009 14:03:29 -0400 http://seekingalpha.com/article/82365-microcap-ideas-photochannel-networks?source=feed#comment-287489 287489 Tue, 21 Oct 2008 21:17:50 -0400
You could have thrown a dart at IBD stock tables, shorted them and still would have been right in this kind of crazy volatile market. That hardly proves that you are right. Looks like you don't have any kind of response to the arguments presented above.]]> http://seekingalpha.com/article/82365-microcap-ideas-photochannel-networks?source=feed#comment-287151 287151 Tue, 21 Oct 2008 12:48:19 -0400
I covered my short before the stock fell much, though, so I didn't profit from being right.]]> http://seekingalpha.com/article/57500-glenview-capital-s-larry-robbins-likes-hmos-uk-pubs?source=feed#comment-230011 230011 Thu, 14 Aug 2008 08:24:42 -0400 http://seekingalpha.com/article/82365-microcap-ideas-photochannel-networks?source=feed#comment-192744 192744 Wed, 25 Jun 2008 14:16:54 -0400 http://seekingalpha.com/article/82365-microcap-ideas-photochannel-networks?source=feed#comment-191474 191474 Mon, 23 Jun 2008 23:20:04 -0400
...except for the fact that they've been outcompeting them and that their business model doesn't put them in direct competition with the retailers.

PhotoChannel's business model is the reason they've been able to outcompete the others and can be expected to continue to.

But it is also the reason it will post excellent gross margins--no money needs to be spent on marketing, as the above commentator noted, nor on the latest, up-to-date machines. What you see in the rear-view mirror is a lot different than what you will see out of the front window. Now and for many quarters to come.

At least that's my best guess. Though I can't wish you well in your short, as I'm long, I hope you do very well in other areas of the market, i.e., no hard feelings. If PhotoChannel does win the Wal-Mart contract, you may need those winnings to help you cover...
]]> http://seekingalpha.com/article/82365-microcap-ideas-photochannel-networks?source=feed#comment-191414 191414 Mon, 23 Jun 2008 21:17:27 -0400
After reading your bear case I had a few questions to ask you.

a) "There has been a clear progression in the industry from everyone going to the photo developer to people printing photos themselves"

Do you have any stats to back up your argument?You mention that more and more people are going to print their pictures at home instead of having it printed somewhere else, but have you calculated the economics of printing pictures at home? I believe its way more expensive to print pictures at home than having it printed commercially. Do you believe that as time goes by, the cost of printing at home will come down and will be more viable than third party printing?

b) "and last I checked, this business is highly competitive" - and you just named one competitor. Are there more than 3 big players in this industry for you to say that its cut-throat competition out there?
You mention that online services like Shutterfly are cheap and high-quality. I don't disagree with that argument- though they are not necessarily cheaper than printing at stores. But have you taken into account the fact that for services like Shutterfly to be competitive, they have to spend tons of money in marketing & advertising to get more customers every year? Have you ever considered that their photo finishing expenses are heavily commodity driven? When silver prices go up and Fuji/Cannon increase the prices of photographic paper ,that will squeeze their margins like anything. Also have a look at Shutterfly financial statements, you will see periodical operating losses.
On the other hand, a company like Photochannel doesn't have any of the above mentioned expenses. It does no marketing and it doesn't have any photo finishing expenses. It gets a transactional fee which can be substantial on high volumes. Snapfish is a real competitor, but recently they lost their Costco contract to Photochannel. What are the chances that they will retain their Walmart contract given the fact that Photochannel runs Walmart photofinishing almost everywhere other than US? I recently emailed Walmart customer service and asked them why Snapfish is giving a better deal online than Walmart even when they were partners and the representative didn't have an answer. (This in no-way means that Photochannel will get US Walmart, but if it does, make sure you cover your short!)

c) On what basis do you say that there cannot be double digit net margins going forward? If you had read the 6-K completely, most of the network costs and SG&A incurred were attributed to the acquisition of Pixology and setting up infrastructure for datacenters to faclilitate the new contracts the company got. So is your assumption is that these costs will not come down or even they will go up going forward?

]]> http://seekingalpha.com/article/82365-microcap-ideas-photochannel-networks?source=feed#comment-191267 191267 Mon, 23 Jun 2008 17:25:35 -0400
Even if Photochannel continues to grow sales, earnings will likely never amount to much because this is a low-margin business. All Photochannel does is offer a website back-end. There are many other companies that have similar programs (such as the aforementioned Shutterfly). There is no reason to believe that Photochannel can outcompete them.

For example, from the company's last 6k, network costs and sales and marketing ate up 61% of revenue. So the company's gross margin is about 39%. Once you add in the necessary high R&D expenses and the G&A expenses, there is little hope for a double digit net margin. I do not believe that Photochannel is an attractive investment at these prices and in fact I am betting against it.

(www.sec.gov/Archives/e...)

Disclosure: I am short Photochannel (PNWIF).]]> http://seekingalpha.com/article/76124-the-long-case-for-vulcan-aig?source=feed#comment-164619 164619 Fri, 09 May 2008 02:58:17 -0400 "• Company is unfairly tarnished, and has been punished by headline risk
• Has never been cheaper at 8 times “depressed” earnings
• Has $13 billion in excess capital
• Potential write-offs are very small given the company’s large asset base
• Company has plenty of staying power"

AND YESTERDAY's headline: "AIG posts 1Q loss of $7.8B, plans to raise $12.5B"

beware of value traps. I like good insurers but aig has a terrible track record , their integrity is one of worst in industry and I simply do not trust their prudence. I will alway prefer a markel or a berkshire hataway to them.

]]> http://seekingalpha.com/article/76122-sears-target-office-depot-walgreen-bargains-in-the-retail-basket?source=feed#comment-164444 164444 Thu, 08 May 2008 18:11:51 -0400 - 'Repurchased 33 million shares the past 3 years' : Yes, at prices much higher on average than today. Shows bad management of cash by the company.
- 'Sum of the parts potentially worth a great deal more than current market cap' : And how do you conclude this? It is such a vague statement, you would think you are listening to a bad politician's press conference.
- 'Trading at significant discount to current $100 price' : Ditto]]> http://seekingalpha.com/article/76219-the-long-case-for-american-oriental-bioengineering?source=feed#comment-164112 164112 Thu, 08 May 2008 10:21:49 -0400
www.investorslive.com/.../
]]> http://seekingalpha.com/article/76124-the-long-case-for-vulcan-aig?source=feed#comment-163886 163886 Thu, 08 May 2008 01:00:13 -0400 http://seekingalpha.com/article/76122-sears-target-office-depot-walgreen-bargains-in-the-retail-basket?source=feed#comment-163852 163852 Wed, 07 May 2008 23:33:56 -0400 http://seekingalpha.com/article/76122-sears-target-office-depot-walgreen-bargains-in-the-retail-basket?source=feed#comment-163851 163851 Wed, 07 May 2008 23:31:22 -0400 http://seekingalpha.com/article/76122-sears-target-office-depot-walgreen-bargains-in-the-retail-basket?source=feed#comment-163629 163629 Wed, 07 May 2008 16:08:36 -0400
I sorry to say, but that sounds like investing by looking in the rear view mirror. If asset valuation metrics were insane in the past, do we than hope for the return of these insane metrics like some diety worshipped in ancient ways? Perhaps we should read entrails and bones as well. The intrinsic value of a business is based on two valuations -- (a) its liquidation value or (b) its going concern value.

Any sound value investor should heed Mr. Munger's counsel and apply the wisdom of Talk 4 (2nd edition) from his book "Poor Charlie's Alamanck" and just ask the simple question how will a company like WAG survive the pressures of competitive destruction over the long term (i.e. the next 10 years)? I try to look into the future as best as I can and all I can see is that WAG in ten years from now will be a weaker company than WAG today based on the strength of WAG's competitiors, the ongoing competitive landscape in general, etc.
]]> http://seekingalpha.com/article/76122-sears-target-office-depot-walgreen-bargains-in-the-retail-basket?source=feed#comment-163560 163560 Look at the their online consumer rating: 1.36 out of 10 That's dismal...I'm predicting bankruptcy. http://www.resellerratings.com/store/Sears]]> Wed, 07 May 2008 14:25:31 -0400
They're dumps. The Super Kmart here (In the better part of town) is 10 years outdated with a roof that never stops leaking.

High prices, poor service, outdated marketing..it's a retail disaster.

Sears holdings lost money during the credit boom, now you try to tell me they will make money in a recession?


PS> Look at the their online consumer rating: 1.36 out of 10

That's dismal...I'm predicting bankruptcy.

www.resellerratings.co...]]> http://seekingalpha.com/article/76122-sears-target-office-depot-walgreen-bargains-in-the-retail-basket?source=feed#comment-163487 163487 Wed, 07 May 2008 12:38:44 -0400 http://seekingalpha.com/article/57311-mbia-could-be-a-zero-faster-than-expected?source=feed#comment-114088 114088 Fri, 01 Feb 2008 13:10:48 -0500
downgradetheinsurers.w...]]> http://seekingalpha.com/article/55239-steak-n-shake-another-friendly-deal?source=feed#comment-109792 109792 Sat, 12 Jan 2008 10:41:05 -0500 http://seekingalpha.com/article/59147-communicate-com-diamond-in-the-rough?source=feed#comment-108890 108890 Tue, 08 Jan 2008 04:30:46 -0500
11/20/2007 2:03:55 PM Communicate.com Inc. (CMNN.OB) announced a third quarter net loss of $429 thousand compared to a net income of $348 thousand for the same period a year ago.

Gross revenues for the quarter were $1.77 million, higher than $2.13 million for the same period last year.

Net loss for the nine-month period was $677 thousand, compared to a net income of $388 thousand for the same period a year ago]]> http://seekingalpha.com/article/59147-communicate-com-diamond-in-the-rough?source=feed#comment-108883 108883 Tue, 08 Jan 2008 01:38:29 -0500
www.seekingalpha.com/a...
]]> http://seekingalpha.com/article/57311-mbia-could-be-a-zero-faster-than-expected?source=feed#comment-105521 105521 Sat, 15 Dec 2007 22:26:08 -0500 http://seekingalpha.com/article/57311-mbia-could-be-a-zero-faster-than-expected?source=feed#comment-105501 105501 Sat, 15 Dec 2007 15:43:07 -0500 http://seekingalpha.com/article/57311-mbia-could-be-a-zero-faster-than-expected?source=feed#comment-105388 105388 Fri, 14 Dec 2007 15:56:01 -0500 biz.yahoo.com/e/071213...

And, if you take twenty seconds to read it, you will see that your "conclusion" is dead wrong. The 8-K specifically states:

"The closing conditions do not include, among other things, an "absence of a material adverse change" condition or a condition that MBIA Insurance Corporation or the Company maintain their current ratings."]]> http://seekingalpha.com/article/57311-mbia-could-be-a-zero-faster-than-expected?source=feed#comment-105377 105377 Fri, 14 Dec 2007 13:51:30 -0500