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Yaron Ron Reuven

 
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  • ARM Holdings Is Everything Intel Isn't [View article]
    I don't think that intc is even going after the $20 chip, as we all know from the 2006-7 intc vs AMD price war, that commoditizing the business any further will ultimately kill it. I understand the bull arm holders being optimistic about them going into desktop server mkt, but what they fail to realize is that an arm ultimate success of stealing major market share (the only thing that would justify current sky high multiple) also assumes that both intc and Amd fail miserably and permanently. These two co. Have been innovating and leading for a almost 100 years combined, and have more resources generated in a single year than arm has made in its history, so that kind of "extreme outcome" is unlikely to say the least. This is not to say arm will fail at their desktop server endeavor, but rather that Amd and intc will not quietly fail and go into the dark. This more realistic outcome also would mean that arm will no longer deserve the multiple the market has been giving it, or anywhere near it in my opinion.
    Jan 6, 2012. 05:16 AM | Likes Like |Link to Comment
  • 5 Best Mobile Computing Investments For 2012 [View article]
    Casey,

    I understand you like the ARMH product, and I doubt there are many that dispute its usefulness. but since SA is a financial website, would you care to go over the valuation?
    Jan 4, 2012. 05:27 PM | Likes Like |Link to Comment
  • Eastman Kodak (EK) is told by the NYSE it has six months to get back into compliance or risk de-listing because its stock has traded below $1 the last 30 trading days. To restore compliance, EK shares would have to trade at $1 on the closing day of one of those six months, and at $1 on average over the 30 days leading up to the close. EK -2.7% AH.  [View news story]
    reverse split here we come
    Jan 3, 2012. 05:42 PM | Likes Like |Link to Comment
  • Green Mountain Coffee (GMCR +4.4%) shares march higher after SunTrust says its channel checks show sales of K-cups and Keurig machines were extremely strong over the holidays, which should help dissipate recent concerns on inventory levels and brewer sell-through. The firm also sees better-than-expected Q1 earnings.  [View news story]
    they're relentless with their recommendation, yet the market listens for the day.
    Jan 3, 2012. 02:40 PM | Likes Like |Link to Comment
  • Is Whole Foods The Next Starbucks? [View article]
    its impossible for wfm to have the same road as sbux, as their stores are dramatically larger and cannot be put in every corner (a key part to sbux's business plan). its a nice store, but real estate costs are too high for such large spaces for them to grow too rapidly.
    Jan 3, 2012. 02:31 PM | Likes Like |Link to Comment
  • 5 Best Mobile Computing Investments For 2012 [View article]
    santacruzcarz,
    you mention one of the key points to our short ARMH argument--insider sales. insiders of ARMH have been selling quite a bit of stock over the last couple of years. they actually have a very good investors section on their website, so take take a look for yourself http://bit.ly/xp4bSd

    further, a main executive is leaving, which leads us to believe that more selling is underway.

    Casey,
    although the technical knowledge of cameraguy are beyond my expertise, they were very informative and it would be great to get a response from you.

    As I have previously wrote, the bull case on ARMH is understandable based on the past, but the problem with most cases that depend on the past performance is that the more successful the past is, the more forgetful investors become of the key metrics to valuation. Yes, you are correct that the opportunity and the market in desktops and servers is huge, but it doesnt mean that armh will successfully capture a meaningful part of it. Plus, based on their royalty business model it also doesnt mean that the business will be as profitable for them as it is for companies like intel or AMD since they only get a small royalty (that continues to decrease every year by almost 8%). Lastly, with the current ARMH market cap of 13BB, while having 150mm sales, and 750mm in sales, the market is pricing the stock as if they have already successfully outgrew AMD (intc long time competitor) by 4 times, and are on their way to become a leader, all the while AMD and INTC (two businesses that have been around ups and downs for over a century combined) failed miserably. big assumption. Now lets say that all happens, we still have to determine what that unprecedented success will equate to in future dollars and cents. Based on today's 13BB market cap, an investor that is buying ARMH is assuming that they will grow at 55% per year for the next 10 years just to break even on todays purchase price. this is just not attainable for ARMH business model for many reasons beyond logic and math. I doubt many investors buy things just with the intention to break even in 10 years from now, but unfortunately with ARMH the best case scenario would mean just that.
    Jan 3, 2012. 02:12 PM | Likes Like |Link to Comment
  • Green Mountain Coffee Roasters Surpasses Overstock.com As Worst Stock of 2011 [View article]
    GMCR director just got paid in stock. http://bit.ly/z3GwJS
    will she regret it? Its odd because its very little money, I dont understand why the company would do such a thing.

    on another note, that i forgot to mention, GMCR is also cash poor (13mm at the end of last quarter) and will likely need to raise money by issuing more stock or borrowing more money. the problem with that is they may have some hurdles doing both. re: issuing stock, shareholders are bound to be pissed off since they are issuing stock at a much more depressed price than many shareholders own it, and much much lower than the insiders sold it. re: borrowing money, the credit market that is already very difficult, may charge them higher rates as a result of the questionable financial allegations being made by many, which will hurt earnings even further in the future.
    Jan 3, 2012. 01:19 PM | Likes Like |Link to Comment
  • Green Mountain Coffee Roasters Surpasses Overstock.com As Worst Stock of 2011 [View article]
    cheeks,
    I understand your viewpoint of the presentation, but see it a little differently. I dont believe einhorn released the presentation to the press per se, but rather the press got a hold of it as a result of the presentation. I defend his point because i view him as one of the most ethical in the industry rather than the contrary, but thats my opinion for what its worth. As far as GMCR, we were were short well before low, and continued to increase short position as stock went lower. I'm not sure when i started commenting on GMCR specifically, but I know I only started commenting online just in the last few months. I've only begun becoming acclimated with the social media stuff in the last year. I see GMCR as a red flag fiasco that is priced to perfection (even at the current prices). to value a business that generates virtually not real profits and 2.6BB in sales at 7.5BB just deosnt make sense to me. even if all the bears are wrong about the red flags, their growth is not sustainable purely because of mathematical reasons, therefore their multiple is inocorrect. investors tend to forget the value of multiples as the prices of their investments move in their favor. but the sole purpose of multiples is to tell the investor how long it will take them to make their money back on their investment based on todays price. in the case of GMCR, (excluding fraud and explosion of multiple red flags) I see a 1x Sales as a very optimistic guide of where they should be priced currently, since there's no dependable profit history to speak of. at 1x sales, it means the stock is trading 3x where it should "optimistically" be. if there is a red flag explosion, then all bets are off and the survival of the company can become questionable. I think they have a nice business and brand, but both can become materially ruined as a result of fraud discovered instead of error admitted.
    Jan 3, 2012. 12:43 PM | Likes Like |Link to Comment
  • 5 Best Mobile Computing Investments For 2012 [View article]
    I understand the bullishness on armh based on their past but disagree with the future. Despite armh working on other products/markets, their stock is priced to perfection. This means that if they deliver (and intc and amd fail) the stock has limited upside since its already priced in. But if intc and Amd deliver, the downside for armh is extraordinary.
    Disclosure: our fund is short armh.
    Jan 2, 2012. 01:40 PM | 1 Like Like |Link to Comment
  • Green Mountain Coffee Roasters Surpasses Overstock.com As Worst Stock of 2011 [View article]
    Franc,
    Have you looked at past work? He's well respected mainly because his due diligence is as extensive as it gets. Similar to chanos's enron, he was well ahead of the crowds on ALD and LEH, both of which collapsed after his findings materialized, with Lehman shutting down, while allied got bought for a fraction of what it claimed to be worth. Again, I'm not einhorn's PR or anything, I just don't understand the rational behind these allegations investors have against someone who is critical of a company, and therefore short the stock. Investors must realize that for every buyer of a stock, there is a seller. Assuming normal conditions (meaning no margin calls or other extraordinary circumstances forcing ones hand) The seller is not selling out of the goodness of his/her heart, they're selling because they think the buyer is giving them a premium on the asset. Some may even take it a step further by saying the seller is saying the buyer is an idiot (and vise versa) for paying that price. The point being is that just because the buyer is bullish doesn't mean that everyone has to agree with them, bc if that were the case he wouldn't be able to purchase the shares since no one would want to sell. You can't, or at least shouldn't, reject all opinions that conflict with yours without at least knowing the full basis of the opposing opinion.

    Unfortunately for GMCR holders, the company has a rough 2012 ahead of them if they are to remove all of the red flags from their equation. Shareholders that use the arguement of past performance as a basis for holding now should realize that there is a reason why "past performance is not a guarantee (or indication) of future results" is the most popular quote in the investment industry, and is written on the bottom of every research or performance report. As I said earlier, our fund is short gmcr
    Dec 31, 2011. 02:01 PM | Likes Like |Link to Comment
  • Green Mountain Coffee Roasters Surpasses Overstock.com As Worst Stock of 2011 [View article]
    its still amazes me how critical investors are of someone who shorts their stock, and how they turn a negative opinion into allegations of criminal behavior and consperacy. shorting a stock is the exact opposite of being long, which means that you are "short the stock because you are critical of the company, not critical of the company because you are short." think about it, there are thousands of stock opportunities out there, why spend so much time and effort being short something that you are lying about? I dont know einhorn, but I am a big fan of his work and would suggest you read his book about another short he had in the past that is not too different from this http://bit.ly/tGP3me Disclosure: our fund is short GMCR
    Dec 29, 2011. 07:20 PM | 3 Likes Like |Link to Comment
  • Price Target And Rating Updates On Adobe, CA, F5 Networks, Nuance, Red Hat And Salesforce [View article]
    I understand that the "market" can do anything, but the point of objective analysis is to determine what something is truly worth and price it accordingly. If I was a new investor to the market with an existing position in CRM (god forbid), this analysis would lead me to believe that it's ok to hold on to the stock despite the sky high valuation that's tied to a bottomless floor. This is why most individual investors lose money in the end. You know, and apparently agree that this stock is grossly overvalued, and has an unfavorable risk vs reward, and therefore your analysis should state so.
    Dec 27, 2011. 08:36 AM | Likes Like |Link to Comment
  • Price Target And Rating Updates On Adobe, CA, F5 Networks, Nuance, Red Hat And Salesforce [View article]
    Your analysis on crm contradicts itself, where in one sentence you say it's pe is "ridiculously high" while at another you are increasing its target. This looks like you are wanting to downgrade the stock but are being held back. This diminishes the value of your analysis to the same as many others who On the street who fear sell recommendations, or dare I say short recommendations.
    Dec 26, 2011. 11:09 PM | Likes Like |Link to Comment
  • Is Green Mountain Coffee Roasters Under Formal Investigation? [View article]
    Brent,
    What kind of open case were you working on, did it ever finalize?
    Dec 21, 2011. 10:02 AM | Likes Like |Link to Comment
  • Is Green Mountain Coffee Roasters Under Formal Investigation? [View article]
    I think the auther asked something called a rhetorical question. Just in case http://bit.ly/u8cTaU.

    Gary,
    Good catch on the sec lingo. The management may play ignorant to this, but their lawyers can't. Everything comes to an end at some point. I hope you start hating more and more stocks to write about, because the info is great when you do. If you want more haters write about CRM. we're short it for our own reasons, but think you may find some similarities with gmcr. Only difference I see is that crm is more proactive by giving a chief legal officer 10mm+ deal last month. Never heard of a CLO, nor one that gets 10mm deals. They must expect him to be busy.
    Dec 19, 2011. 05:20 PM | 2 Likes Like |Link to Comment
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