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Zachary Scheidt, CFA

 
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  • VistaPrint: Potential Short on Lawsuits and Legislation [View article]
    Poor business practices and fraud will eventually come back to bite you even if you are profitable for a time. This is why I have avoided VPRT and would consider shorting once the s--- hits the fan.

    Zach
    zachstocks.com
    Jul 25 05:44 PM | Likes Like |Link to Comment
  • Breadth at an Extreme [View article]
    While I turned overly bearish late last month and have had to do some adjusting, I am now beginning to wonder if we could see more strength as underperforming managers and impatient retail investors finally jump in from the sidelines. Barron's had a good article about this last week.

    If there is a decent amount of sideline cash to be sucked in, we could see another 10 th 15% but that would likely set up a very nasty reversal this fall or early 2010.

    Momentum has a way of surprising us with it's stamina sometimes...

    Zach
    zachstocks.com
    Jul 25 04:33 PM | Likes Like |Link to Comment
  • Hedge Funds Recovering Faster than in Past Periods [View article]
    It's always interesting to see performance numbers on "hedge funds" as an aggregate number even though the tactics and strategies vary so widely. Hedge funds as a category may be improving, but there are extreme winners and losers depending on what the individual funds are doing. I think one of the most important changes that the financial crisis has caused is that funds are now limited as to how much leverage is available. Hopefully this will help protect consumers from such excessive losses in future quarters even if the strategies fall out of favor.
    Jul 25 04:20 PM | Likes Like |Link to Comment
  • Tech Stocks Rally [View article]
    Of the names mentioned driving the Nasdaq 100, several appear overvalued and sensitive to an economy that has yet to prove its resiliency.

    Expedia in particular strikes me as having significant risk. While we made a case for owning the stock late last year - albeit a bit early (zachstocks.com/2008/12.../) the stock is closely tied to consumer spending which is still not seeing significant recovery. With unemployment high and businesses cutting expenses, this stock could quickly see both earnings and multiple contract which would be devastating for the longs.

    On a similar note, China's Ctrip.com could face a similar fate. (zachstocks.com/2009/06.../) - The stock is sitting at a level that has proven to be resistance (near $47.50) and is valued at about 40 times this year's estimates. It would take a lot of growth to justify this price.

    Opportunities to short or buy puts on NASDAQ names certainly look attractive in today's market.
    Jul 17 03:00 PM | Likes Like |Link to Comment
  • American Enterprise Institute and Consumer Financial Protection [View article]
    good article - I'm tired of the assumption that homeownership is an American right. While there is no problem with it being the American dream, some dreams only come true after hard work and sacrifice. You can't tell me that over time, a determined hard working individual can't afford a mortgage regardless of his background. But it isn't the government or Wells Fargo's job to make sure that this dream is possible.

    You mention that disclosure isn't enough. I'm not sure that I agree with this. But I don't think the mortgage process has come close to true disclosure in decades. Writing everything down on 200 pages of mortgage documents and then asking a buyer to initial every page assuring him that this is "standard" isn't disclosure - it could actually be considered duress.

    I agree with you that options should be available to ALL buyers, not just those who are considered sophisticated. But the disclosure for those options should be explained in peter rabit english so that buyers who do not have an MBA in finance can still understand what they are getting involved in.

    Zach
    zachstocks.com
    Jul 17 02:51 PM | 2 Likes Like |Link to Comment
  • Loan Delinquencies Cast More Doubt on the Economic Recovery [View article]
    excellent comments all around... The possibility of a deflationary death spiral cannot be overlooked. But with the powers that be intent upon printing our way out of this mess, I would anticipate the end game being a debasement of currency in return for a "paper" bull market. Unfortuantely, a paper bull market really does very little to help consumers or the economy because that paper becomes worth less. Employment will still be weak, and those who have jobs will find their earnings taxed to the breaking point.

    These are serious issues. And we can't simply "hope" that things get better as we throw more money at the situation. For the next decade, investors will have to become increasingly creative to find REAL returns and to protect the purchasing power of their assets. But opportunities abound for those willing to consider approaches other than the "buy and hold" standard we have held to for so many years.

    Thanks for the comments guys!
    zachstocks.com
    Jul 10 11:27 AM | 1 Like Like |Link to Comment
  • Energy Regulation Weighs on U.S. Exchanges [View article]
    Donzoab - Do you really think this is an issue of price manipulation? Or is it simply many participants all seeing the writing on the wall and putting themselves in a position to profit? Either way, if the price moves too far in one direction, astute traders should be able to take the opposite side and benefit from recognizing mis-pricing. Price manipulation is certainly unethical. But trading for profits in volatile markets is simply part of our capitalistic society.

    Sure Andy, I think there are definite problems with Efficient Market Hypothesis. But inefficient markets simply give us as traders an opportunity to profit from recognizing and trading based on incorrect price points. Saying that markets are not efficient and so therefore must be manipulated by the government is NOT a good solution. That just creates MORE inefficiencies.

    zachstocks.com
    Jul 10 10:24 AM | Likes Like |Link to Comment
  • Vornado's Private Equity Fund: Non-Traditional, Smart Solution for Tough Times [View article]
    one of the issues to consider when talking about dilution is whether the stock is being traded at a discount to NAV. If VNO offers a large public stock offering while their stock is trading at a discount to NAV it would be dilutive to NEW shareholders. That is because the company is receiving $1.00 but immediately that $1 invested by the new shareholder is worth less due to the discount on the stock price.

    So in order to make a deal attractive, it may have been necessary for VNO to offer interest in a NEW vehicle so as to avoid the significant dilution inherent when investing in a REIT that is trading below NAV.

    zachstocks.com
    Jul 10 10:09 AM | Likes Like |Link to Comment
  • Oil to Retest $40/Barrel by Year-End? [View article]
    The recent weakness is likely due primarily to regulatory rhetoric as the CFTC threatens to curb speculation. While oil could certainly continue to drop as a function of weaker demand in a stubborn global recession, it will not likely reach the fear levels seen this spring. One of the main reasons is because we don't have nearly the amount of long exposure trapped in the markets. In mid to late 2008, nearly everyone who dabbled in the market had exposure to oil or some other energy investment. As the bubble burst, it caused excessive selling which the market could not absorb. I don't think there is the selling pressure today to drive the prices to that extreme low.

    Zach
    zachstocks.com
    Jul 9 01:50 PM | 1 Like Like |Link to Comment
  • Four Stocks for 2009: Second Quarter Review [View article]
    Thanks Dave - yes there are definitely several choices in this industry - each with different dynamics associated with debt, length of contracts, quality of customers, age of fleet, and type of fleet...

    I'm a bit concerned that the bottom in the dry bulk index could be temporary similar to the broad equity market having bottomed in March but still vulnerable to significant decline today. For shipping to do well, we need international trade to pick up and at this point, trade trends are still very much in question.

    Thanks for the great comment,
    Zach
    zachstocks.com
    Jul 8 09:34 AM | 1 Like Like |Link to Comment
  • Middleby: Selling Ovens in a Cool Market [View article]
    Tmarigold - you may be right long-term, but the weakening economy has all participants in the commercial foodservice industry cutting costs. That means even schools and prisons are likely to forgo a new oven if the old one still works (even if it is inefficient).

    MIDD is now down 18% since the article was published - picking up momentum in the last couple of days inline with the market. We are probably getting closer to a support level (low 30's maybe) providing the debt is managed carefully.

    Thanks for the comments guys,
    Zach
    zachstocks.com
    Jul 8 09:31 AM | Likes Like |Link to Comment
  • Priceline: Stock Price Is Likely to Fall [View article]
    CK Finance - I think you're right on the market share part. Priceline will likely command a larger piece of a shrinking pie. But one thing to keep in mind is that as travel dollars decline, many of priceline's competitors will take the Wal-Mart approach and aggressively slash prices. It's a desperate move to stay in business. This lowers profit margins across the board.

    rtrucker - you may be right, but the process to get to that place will likely be painful. And for the travel industry specifically I expect a good bit of contraction.

    Thanks for the comments guys,
    Zach
    zachstocks.com
    Jul 8 09:26 AM | Likes Like |Link to Comment
  • The New York Stock Exchange mistakenly posted on its website that AIG (AIG) was subject to suspension and delisting. The notice has been removed and NYSE says it regrets the error.  [View news story]
    oops! Wow, that would be a wake up call
    Jul 2 07:50 AM | Likes Like |Link to Comment
  • LogMeIn IPO: Where Will the Money Go? [View article]
    I'd like to think that these guys are a cut above that type of business. But you never know - I guess it's a possibility.

    Stock up 25% out of the gate. Definitely a good sign but I don't expect much further movement. Earnings simply don't support this price.

    Zach
    zachstocks.com
    Jul 1 04:01 PM | 2 Likes Like |Link to Comment
  • Be Wary of Risky China Bank Loans [View article]
    Excellent point! It appears both countries have similar economic philosophies (which is scary in its own right) and are just using different (but similar) means to implement.

    Thanks for the comment,
    Zach
    zachstocks.com
    Jun 30 08:05 AM | 1 Like Like |Link to Comment
COMMENTS STATS
232 Comments
186 Likes