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Vince Martin  

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  • Blucora: Yes, It Was A Good Quarter, But... [View article]
    I think the overall FCF multiples are a bit aggressive there - I think $70M is a lot for FY15 FCF.

    That said, I get the bull case, and as I write this articles, I admit to feeling a bit overcautious here. And it may be that I'm overly bearish toward both AVG and BCOR, and making the same mistake in both cases.

    As for the thought exercise - in the aggressive model above, the non-TaxACT businesses can cancel each other out. So I see the argument there - give TaxACT 15x profits and that's ~$840M and you're up 30% from current levels to fair value. (If you look at HRB/INTU, you can go higher than 15x, obviously). But, again, I think that's aggressive, and if it's just TaxACT less interest expense, the case gets a lot less clear.

    Overall, I still think management has to show me they're going to use the $300M properly, and not try to build some mini-IAC or something instead of letting Search erode of its own accord. But I can see the argument there that if they do, the stock will be up 15-20% before I even know about it. Thanks for the comments.
    May 5, 2015. 04:00 PM | Likes Like |Link to Comment
  • Bridgepoint Education: Yes, All Those Risks Are Priced In [View article]
    I've taken a brief look at ONE - but I haven't read your April article yet. My initial response was basically, "ugh, there's too much going on here" but it's still on my list of stocks to check out.
    I think any company that has access to the sector at large - not just the for-profit space - probably has more upside than BPI and its direct competitors. ACC - a college housing REIT - is another interesting one from that standpoint.
    May 5, 2015. 10:42 AM | Likes Like |Link to Comment
  • Bridgepoint Education: Yes, All Those Risks Are Priced In [View article]
    Thanks for the heads up - headline numbers do look good (or not terrible, which is good in this sector right now).
    May 5, 2015. 10:28 AM | Likes Like |Link to Comment
  • Speedway Motorsports: Q1 Lends Fuel To The Short Case [View article]
    Ah, fair point, gotcha. That's an interesting take. I'm still a bit skeptical of it though: I don't see how the company makes that type of monetization decision at any point in the near future - and in the case of both ISCA and TRK, the family ownership means that type of decision might be more difficult to swallow. Still food for thought though.
    May 3, 2015. 05:45 PM | Likes Like |Link to Comment
  • Monarch Casino & Resort: Black Hawk Expansion Is Far Too Risky [View article]
    I enjoyed the endless series of puns here. Well done.
    May 1, 2015. 08:46 PM | Likes Like |Link to Comment
  • Speedway Motorsports: Q1 Lends Fuel To The Short Case [View article]
    The tracks are essentially worthless without a NASCAR deal - their value for the next 9 years (at least) can only be monetized by event revenue.

    The interest expense is definitely helpful - I think $8 per share is a bit aggresive if you discount the potential savings but it can help. That said, if interest savings are doing nothing but maintaining flat earnings/FCF I don't see how the current multiples get maintained.
    May 1, 2015. 08:45 PM | Likes Like |Link to Comment
  • AVG Technologies: Solid Q1, But Not Enough To Turn Bullish [View article]
    The net income I think is concerning bc it's a bit hidden by the recent repurchase and by increasing share-based comp, which is backed out of non-GAAP. A 20% decline YOY is pretty steep.
    May 1, 2015. 08:38 PM | Likes Like |Link to Comment
  • AVG Technologies: Solid Q1, But Not Enough To Turn Bullish [View article]
    From a subscription standpoint I guess the question is whether or not an investor sees a near-term peak - it is a more stable revenue stream but that doesn't mean it can't turn south in the not-too-distant future. There's also the question of what type of EPS that business alone can support - they're basically getting free cash from search, since I doubt they're putting any R&D or much in the way of SG&A into it (and gross margins are 95%).

    I don't see them as much of an acquisition play - I don't think they really fold well into SYMC or INTC. My question with private equity/LBO/etc. is whether non-Dutch ownership would jeopardize their very sweet tax deal.
    May 1, 2015. 08:37 PM | Likes Like |Link to Comment
  • Thompson Creek: At All-Time Lows, Still Not A Buy [View article]
    Curtis:

    Thanks for the kind words. As for valuation, it's tough with so many moving parts. I think from a margin of safety standpoint it would have to be at least fair value of Mt. Milligan - net debt (maybe adding ~$100 million for Langeloth at 7x cash flow or something like that). That way, I have the 'free option' on moly - but I truthfully don't think the moly mines have material value right now. There's $100M+ costs and it's not unrealistic that they're dormant for another 5 years. But between refinancing and execution risks I don't think I'd be interested above $1 in the next few months (barring a dramatic change).
    May 1, 2015. 02:44 AM | 1 Like Like |Link to Comment
  • OmniVision Technologies: Leave The Spread, Take The Offer [View article]
    Fair point - I was trying to fill in the third required bullet point and "leave it to the professionals" was probably not the best choice of words.
    May 1, 2015. 02:34 AM | Likes Like |Link to Comment
  • OmniVision Technologies: Leave The Spread, Take The Offer [View article]
    I didn't say that I agreed that the purchase would be denied - I said that smart people did, and that it's a risk. Read the links in the article - multiple analysts have discussed potential regulatory blocks relative to the buyout. I think the chances are low but there is a chance nonetheless. It's not that the GOP-Dem debate in September 2016 will have its first question on OVTI, but it only takes one primary candidate to play up the "we're selling our tech to China for a few billion" to focus attention.

    Profit and margin erosion are expected because that's the business model of semiconductor companies - you sell ever-increasing amounts of products at ever-lowering prices. There isn't anyone - OVTI included - who thinks they have the unit growth potential to overcome that in the near term.
    May 1, 2015. 02:33 AM | Likes Like |Link to Comment
  • OmniVision Technologies: Leave The Spread, Take The Offer [View article]
    Many individual investors are going to have commissions eat up a fair amount of their returns.
    May 1, 2015. 02:23 AM | Likes Like |Link to Comment
  • Eldorado Resorts: Two Bad Businesses Don't Make A Good One [View article]
    The core thesis here is that ERI is going to have trouble growing going forward - not sure where you're getting the idea that it's purely backward-looking. My point is trailing valuation is already reasonable and I don't see it getting better with PA/WV heading quickly toward accelerating and negative operating leverage.

    I did read your coverage - well done on the trade. I'd be interested in how you support $160M in EBITDA in FY15, bc that will obviously be a huge difference in how we get to fair value. The $200M figure simply seems way too optimistic from my standpoint - I'd point out that Scioto needs a constitutional amendment for table games and I'd correct one other point: Indiana already has card games. Thanks for the comment - interested to hear your argument for growth here.
    May 1, 2015. 02:23 AM | Likes Like |Link to Comment
  • Full House Resorts: A Speculative - And Likely Entertaining - Potential Turnaround [View article]
    Thanks for the comment. You may be right; I may be a bit too optimistic on Lee and the plan here. (As an occasionally loud-mouthed Irishman I probably have a soft spot for kindred spirits.)
    That said, management contracts aren't that easy to find and I don't think he has much choice on the ownership front. There's no hope of selling Rising Star with the lease obligation. The Mississippi hotel Lee admits that he probably wouldn't have built. But it's halfway done so what is he going to do?
    I think the endgame here is a sale of the hotels - maybe as a group, maybe individually. ERI and MCRI (more likely the former) would be interesting candidates for Fallon. I don't think Rising Star makes it. A fixed up Mississippi might be of interest to one of the regionals (ISLE perhaps? I'd have to double-check their locations.) All told, your strategy might be the correct one but I'm not sure how Lee can head in that direction right now - what's the point of selling the hotels when their value is at/near their lowest point?
    Apr 30, 2015. 06:44 AM | Likes Like |Link to Comment
  • Eldorado Resorts: Two Bad Businesses Don't Make A Good One [View article]
    Thanks for the kind words - they are rewarding and appreciated.
    Apr 30, 2015. 01:21 AM | Likes Like |Link to Comment
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