Q3 2009 Earnings Call Transcript

November 5, 2008, 11:00 am ET

Q1 2009 Earnings Call

May 7, 2009; 11:00 am ET

Q4 2008 Earnings Call

February 17, 2009 11:00 am ET

This is the Third Quarter 2008 edition of our ongoing hedge fund portfolio tracking series. Before reading this update, make sure you check out the preface to the series we're doing on Hedge Fund 13F filings here.

The other funds we've already covered include:

At the end of each week, our market direction radar scans the Hillbent 3000 universe (minimum average daily volume of 100k and largest 3000 market capitalization stocks) for the top 3 and bottom 3 sectors based upon aggregate performance and analyzes their winners and losers.

Using this weekly sector report on a regular basis allows Hillbent.com’s readers to efficiently monitor sector rotations and investor sentiment biases.

A few weeks ago, I wrote a series of two articles on the yet-to-be-unveiled Obama stimulus package for the economy, arguing that things pointed in the direction of massive infrastructure spending with a green twist. I argued that this would benefit a certain categories of rail-related stocks and electric grid stocks. How am I doing relative to the market as a whole, which has had several positive trading days for the past while on the back of the eventual stimulus plan?

Railway Stocks

Q3 2008 Earnings Call Transcript

November 6, 2008, 11:00 am ET

I'm not sure whether John Maynard Keynes, the father of Keynesian economics and an ardent proponent of government interventionism during hard economic times, and Rachel Carson, the mother of modern environmentalism and the author whose work is credited for the eventual creation of the EPA, ever met during their lifetimes. But if current voter sentiment holds until November 4, their ideas could soon converge and form the basis of government policy for at least the next four years. Let me explain.

First, John Maynard Keynes. There is no doubt that the deliberate and coordinated nationalization of financial services institutions across the West marks a new low for neoconservative economic thinking. This line of thinking holds that government should play as small a role as possible in the economy, and leave spending decisions to individuals and firms. Proponents of this philosophy argue that the best fiscal move a government can ever make is to return money to its citizens and corporations through tax cuts, who will then spend that money most efficiently. The Keynesian approach, on the other hand, is premised on the idea that it is not only OK but even desirable for governments to step in and directly incur large expenditures in difficult times to jump-start the economy.

Q2 2008 Earnings Call

August 7, 2008 11:00 am ET

Q1 2008 Earnings Call

May 8, 2008 11:00 am ET

Q4 2007 Earnings Call

February 20, 2008 11:00 am ET

Stocks discussed in the lightning round session of Jim Cramer’s Mad Money TV program, Wednesday December 19. Click on a stock ticker for more analysis:

Bullish calls:

Guess? (GES)
J. Crew (JCG): 'Is run by the unbelievable Mickey Drexler, who also has a MadeWell division that's right.'
Molson Coors Brewing (TAP)
Thompson Creek (TC): 'You've got to buy more... Molybdenum is in short supply. This stock ran. It's come back down … Yes! I would commit the ultimate sin of averaging down … because the company's worth a lot of money.'
Intel (INTC): 'Is annihilating them bad! I'd rather see you in INTC. Take the loss and move into INTC.'
Schering-Plough (SGP): 'You've got to buy the stock, so I like SGP here... I think $2 down, and $5 up. That's the... I really do believe that this thing won't go below $24, and I believe in Fred Hassen... he has never failed.'
Magna (MGA): 'This is a very low-cost producer of auto parts... and, while it's come down a great deal - as has everybody in the industry - I don't think selling it down here makes a lot of sense.'
Johnson Controls (JCI)
MEMC Electronic Materials (WFR): 'WFR is making so much money, and is so product-constrained, that they can just bang all the solar companies…WFR is a total win here. Be careful... it's also at its 52-week high... It had a span of profit taking...'
First Solar (FSLR)
Copart (CPRT): 'CPRT has just been a monster stock, since we recommended it at $35-36. And, at $40, not only am I not backing away, but I want to buy more. Buy, buy, buy! The fundamentals are strong here!'
Koppers Holdings (KOP): 'I like rail exposure. They make the ties... the ties that bind the stock at $45... That's where it's going. I like the stock.'
Oshkosh Truck (OSK)
Goldman Sachs (GS): 'I want you to buy, buy, buy. I think that this company is head and shoulders better than the other guys and, yet, the price-to-earnings multiple is no higher. What an opportunity! Go take down (buy) some GS!'.

Bearish calls:

American Apparel (APP): 'I don't necessarily want to be in this at all... I don't like the bloodlines of it.'
Anheuser-Busch (BUD): 'It's not going to hurt you, it's not going to make you a lot of money... The best thing I can say about BUD is that it's better than it used to be... '
Citibank (C): 'I don't know that they're [the Fed] savvy enough to make it so that they do the right thing but, if they do, C is a buy... And, if they don't... Sell, sell, sell!... Forget about it...'
Advanced Micro Devices (AMD): 'Stay away from my Wall of Shame stocks, until the CEO goes.'
Pacific Ethanol (PEIX): 'If you bought it yesterday, up a buck and a half. I want you to actually ka-ching it (sell it)... I don't like the ethanol group.'
Spartan Motors (SPAR)
Force Protection (FRPT): 'I don't want you touching that at all.'

Seeking Alpha publishes a summary of Jim Cramer's stock picks every day including: Mad Money Recap, Lightning Round, Stop Trading and Wall Street Confidential

Here is a great article from the co-founder of Greenpeace, Patrick Moore, in response to the new documentary 11th Hour (which I have not seen). Here is a very interesting excerpt from the article (bolding is mine). I don't have an opinion on carbon credits either way, but I thought the stats on forest expansion are surprising:

As a lifelong environmentalist, I say trees can solve many of the world's sustainability challenges. Forestry is the most sustainable of all the primary industries that provide us with energy and materials. Rather than cutting fewer trees and using less wood, DiCaprio and Berman ought to promote the growth of more trees and the use of more wood.

Trees are the most powerful concentrators of carbon on Earth. Through photosynthesis, they absorb CO2 from the atmosphere and store it in their wood, which is nearly 50 per cent carbon by weight. Trees contain about 250 kilograms of carbon per cubic metre.

I built a simple stock screen to identify companies with multiple characteristics common to the persistent wave of buyouts we have been seeing, and the results are included below.

I was happy when I logged on to the Internet Monday morning and learned that a company I purchased on Friday was a buyout target, and its price was up 7% (not a bad return for one business day).

1 - Chipotle (CMG) - 181%. This market has been so difficult that even the most successful offering of 2006 recently had a busted secondary. I was quite high on CMG pre-IPO, the valuation in the $60's though is awfully aggressive. 55 X's '07 estimates with 20% expected revenue growth.

In the case of Vonage, most of the company (80%) was owned by several private equity funds. A small IPO of 20% of the company is just a tool for “price discovery” on the remaining 80%. Given the gruesome disclosures in the prospectus (which went something to the effect of "We have lost money, we are losing money, we will continue to lose money), it is pretty obvious that the private equity people are not going to stick around after the lock ups expire.

A similar problem took place in the recent IPO’s of Koppers Holdings Inc. (KOP), Sealy (ZZ) and Burger King (BKC). These companies are part of a recent, dangerous and related trend of LIPO (Leveraged IPO) transactions. In each case, prior to the IPO, the Private Equity sponsors paid themselves massive “special dividends” and received cancellation fees for management advisory agreements.

If current owners are exiting, why should you enter? In the case of Vonage, most of the company (80% of it) was owned by several private equity funds. A small IPO of 20% of the company is just a tool for "price discovery" on the remaining 80%. Given the gruesome disclosues in the prospectus (We have lost money, We are losing money, We will lose money), it was pretty obvious that the private equity people are not going to stick around after the lockups expire.

Koppers has two main product lines: Koppers is one of the world’s largest producers and refiners of coal tar and they are main suppliers of railway crossties to the US railway industry.

Coal tar has never been sexy, but to make one pound of aluminum requires half a pound of coal tar. Although the aluminum industry has been trying to find a replacement for coal tar, it has been unsuccessful so far. The newest Alcoa Inc. (AA) smelters being built in Iceland and Trinidad are all configured to use coal tar. Global aluminum production has been increasing strongly, as China and India have become net importers of aluminum.