William Kabourek

K12 Could Be a Short Seller's Nightmare

Wish I knew for sure, but I don't. A better question is why do we owners allow such large stock grants that a Baule gets to reload for 30M plus grants per year and Packard 150M. Last proxy had Baule owning 220000 shares and Packard 1500000 so they should be interested. Like most corporate executives they take dollars off the table because they know it will be replaced annually.

Parson's Portfolio: Citi Chair Has Little Skin in the Game

First, he isn't or wasn't a commercial banker. He was CEO of Time Warner. Second, he hasn't been there just a few months but is a carryover from the original board.

Given the fact that he was part of the problem, I'd have gotten rid of him, but he's an Obama supporter and that is evidently enough qualifications.

Overlooked Education Sector: K-12 Poised to Prosper

Your views echo mine. K12 is a fine company in a good space. I feel it's the best of the for-profit education companies as they are not subject to the student loan funding, exorbident tuition, and dubious job prospects that trouble the on-line trade schools and so called universities.

K12 lowers education costs which bodes well in bad times.

Short Idea: K12 Inc.

I wouldn't risk shorting at this time. While LRN may decline with the general market pull back, the company itself is sound and in the sweetspot of education. Internet education, K thru 12, is on a huge uptrend. Ed budgets for virtual learning are being spared since they are a cost saver for school districts. Even the teachers unions aren't 100% against them as K12 uses unionized teachers in their instruction-just not as many per student load. Yes, the P/E is high, but so is their earnings growth as they have only reached profitability a few years ago. To use an overused term, their product is highly scaleable and the P/E will shrink as earnings grow. The company is worth holding long term and could see a huge pop, as it did about 2 weeks ago with a $7 move, if negative betters try to move to the door en masse.

Vulcan Materials Company Q1 2009 Earnings Call Transcript

I'm amazed at the sheepishness of "professional" analysts. Maybe I missed it, but I've just completed a scan of the call and NOT ONE analyst asked any questions about VMC's debt decisions. Issuing new debt at much higher rates than the debt they are paying off while keeping the dividend. Any covenant issues looming? Why do analysts matter to anyone?

Sam Zell: 'Very Few CRE Financings from 2003-2007 Are Above Water'

The old saying "your first loss is your least loss" isn't a new concept. Anyone, except for this generation of lenders, who has financed deals knows it is true with rare exceptions. To be that exception you better have a borrower with very, very deep pockets and not many competing obligations. The first guy out usually looks pretty smart with hindsight.

What Will Happen to Berkshire Hathaway Post-Buffett?

Steve and Long On Oil, thanks for your input. I'm convinced that Warren and his board have thought long and hard about a replacement. Their decision will be as smart as is possible. But, and this is my thesis, no one is Warren. The successor will not have the years of expertise, the patience, and the goodwill of Buffett. Buffett believes in his CEOs and they believe, and feel obligated, in him. For all of his former owner/ceos, and their teams, it remains enjoyable to continue to run your baby, diversify assets for estate planning, and get to interact periodically with the world's greatest investor. How do you beat the deal Warren gives them?

The new guy will cause, probably not intentionally, the fun to end and turn billionaires into mere subsidiary ceos. That may well be a position that you and I would find attractive, but these guys are really rich. They don't have to do anything that they don't want to do. I cannot see a new ceo not asking for more reports, updates, plans, etc, along with constant tinkering. I also can't see the BRK BofD telling the new ceo to let the subsidiaries run free.

In almost every situation, acquired ceo/owners that try to stay don't last. It's just not the same. Berkshire will face the transition that I describe. It won't be fatal, but it will be disruptive.


On Jan 14 11:44 AM SteveR wrote:

> I don't know William. To assume that a new leader will emerge and
> completely reverse the culture that has been part of Berkshire seems
> to be the least probable outcome. I would say that the most probable
> outcome would be a continuation of the Berkshire culture, which is
> what sets it apart from almost all other large US corporations. It's
> not like Buffet is the only one at Berkshire that recognizes their
> recipe for success. Granted Buffet is an "Einstein of Investing"
> and cannot truly be replaced but he can be emulated fairly well and
> I think they have spent a lot of time trying to find the best Buffet
> emulator.
>
> I think the more likely scenario would be this. Buffet will go and
> the market will overreact in typical fashion and oversell, presenting
> a really good buying opportunity.
>

Uncle Sam Needs a Taste of His Own Medicine

They might as well try. Fear is prevalent and the flight to safety has been immense. Sooner or later the fear will lessen and bond investors will demand more yield. If the U.S. persists in rolling over short paper for the massive amounts it is now committed to borrow, it will meet much higher rates down the road. Treasury needs to try and push as much of the borrowings out on the long end as is possible.I hope it is under consideration.


On Jan 12 09:03 AM prudentinvestor wrote:

> Good point. Return of the 30-yr treasury would be welcome. Perhaps
> the treasury fears it won't find many takers at ultra-low rates?

PNC Financial Services: Wisely Moving Ahead

Assuming that NCC had to sell quickly because of liquidity issues, not credit issues, then, yes, PNC made a handsome purchase. The purchase accounting write-offs, relatively quick tax benefits, and the TARP capital has the makings of a good deal. PNC is still priced richly for large banks, but the returns should be good, especially at the current dividend payout ratio.

Cautiously Optimistic About Vulcan Materials

One of the biggest issues VMC has staring at them is their dividend coverage ratio. They've been paying $1.96 and analysts expect earnings of only $1.90 for '08 and $1.96 for '09 [this will be reduced as the year progresses]. A well run business doesn't payout 100% of earnings AND debt covenants don't allow that either. In bad times you conserve cash, especially when you have the debt load Vulcan is carrying from the Fl Rock deal.If it doesn't happen this quarter, they will cut the dividend in the 1st quarter as there will not be enough federal stimulus help to offset housing, commercial, and shrinking governmental road building. 12XCF is too rich for a company with declining earnings and dividend.