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  • The 5 Dimensions Of Variant Perception  [View article]
    "Know everything about the boat, but nothing about the river."

    A very useful metaphor, thanks!
    Nov 27, 2015. 06:43 AM | 1 Like Like |Link to Comment
  • Bank Of America Has The Potential To Significantly Increase Its Dividend: A Look At The Bank's Payout Ratio  [View article]
    Last 3 quarters Common Shares Outstanding:

    Q3: 10,427,305,000
    Q2: 10,471,837,000
    Q1: 10,520,401,000

    Net share reduction: 93,096,000
    Percent share reduction: .885%

    Conclusion: It's a drop in the overall bucket...but a nice start.
    Nov 24, 2015. 07:11 AM | 4 Likes Like |Link to Comment
  • AIG: Don't Sell Just Yet, Icahn's Activist Battle Over Break-Up Is Just Heating Up  [View article]
    I'm wondering how a split-up will effect the warrants?
    Nov 24, 2015. 06:39 AM | 1 Like Like |Link to Comment
  • Vanguard Natural Resources - New Round Of Impairments Has Hurt The Stock  [View article]
    I'll add that we should look at the following to determine the survivors:

    1. Debt/debt service/debt covenants
    2. Cash available vs. cash burn
    3. Hedges
    4. Asset revaluation

    Magnum Hunter is a great case to follow. Pull up the SA articles in chronologic order starting last summer and follow the logic. It lays out the "death march" pattern. It's educational, sad but educational.
    Nov 17, 2015. 04:02 PM | Likes Like |Link to Comment
  • Vanguard Natural Resources - New Round Of Impairments Has Hurt The Stock  [View article]
    Or... the Saudis will continue their current strategy until a large percentage of marginal players have declared bankruptcy. The question then becomes, which marginal players survive (and are investable) and which don't?

    I think it is too soon to start placing bets yet. Some will go under, others will sell off their best assets to remain afloat, and yet others will be bought up at pennies on the dollar (assets in the ground) by larger, integrated oils.

    I think the real carnage starts as soon as later this month as tax selling kicks in...all the way through 2016 as favorable hedges start rolling off the survivors.

    The time to buy will be when the vultures start picking the meat off the dying. The bleeding has only just started, IMHO.
    Nov 17, 2015. 02:18 PM | 5 Likes Like |Link to Comment
  • Evidence-Based Investing: 5 Easy Reasons Why You Should Copiously Buy Gilead Sciences  [View article]
    Well said, I completely agree.

    GILD spent $900M for the repurchase of 8.81 million shares at an average stock price of $102.14.

    Plus, GILD spent $3.9 billion for early redemption of 46 million warrants related to the 2016 convertible bonds at an average stock price of $113.96. There are 9 million warrants left.

    Probably more important, GILD is guiding for another 25 million share reduction for Q3. They report having $14.1 Billion left on their present share repurchase program...leaving plenty of dry powder going forward.

    They have plenty of cash and generate more everyday, they want to return it to their shareholders, they believe that their own shares are a good value, and are creating a favorable tailwind for their stock price.

    They are setting the stage for your "green squiggly line to catch up to the torrid blue line"...we just need to hold on for the ride!
    Jul 30, 2015. 10:02 AM | 9 Likes Like |Link to Comment
  • So You Missed Out On Receptos... Who's Next?  [View article]

    OK, I'll bite; but I didn't know that the "posting protocol" required CV disclosure.

    MD, MBA...7 years in academic medicine leading the research portfolio in a different therapeutic area than virology at a major US medical school...short burst with the US subsidiary of an international Pharma company heading up a new therapeutic group (hated it)...now CEO of a clinical specialty group...long term investor in GILD...rarely post because of unnecessary nonsense and sarcasm.

    Hopefully, the above will be found sufficient to allow me an occasional post:

    1. VLP Biotech...think broadly
    2. Immunocore...see the possibilities?
    3. "Line extension" you are correct, I shouldn't have used that term. Thanks for pointing it out. "Enhance the NASH product portfolio" is better said.
    4. We'll see what GILD buys next, but phase II FDA submitted drugs used to be considered "late-phase". That is the sweet spot, IMHO.

    Seems to me that working together improves the probabilities of making money.
    Jul 19, 2015. 01:48 PM | 11 Likes Like |Link to Comment
  • So You Missed Out On Receptos... Who's Next?  [View article]
    I agree with SPBrat, to a point.

    Brat is absolutely correct that the incremental revenue and cash generated from the rest of the world (ROW) coming on-board the GILD HCV franchise is compelling. I think it is a given that GILD will reap that in the coming quarters and years. No doubt in my mind that analysts are underestimating ROW sales and contribution to EPS. We'll see on July 28 and that is only the early start!

    Where I differ is that I think GILD should (and will) ALSO make strategic acquisitions. Both can be done easily and given where GILD is trading today--cash rightly will be the likely predominant currency. Cash is cheaper than GILD stock right now, in my opinion.

    So, what might GILD look to acquire? Obviously, it's all about value, but in some order:

    1. Complimentary platform technology in Virology;
    2. Promising platform technology in Cancer;
    3. Line extension in hepatic disease (HCV, NASH, etc);
    4. Key strategic compound (better if late stage development);

    With the growing strength of the US dollar versus Euro, the purchase price with USD of European companies is dropping. GILD's recent acquisition of Danish EpiTherapeutics is the perfect example of this "USD/Euro arbitrage" approach leveraging #1 and #2 above. It would not surprise me to see GILD targets a bigger European company like Immunocore or someone like that.

    With all the venture money sloshing around these days nothing is cheap, but GILD has never been shy about paying up for their preferred targets. So, I think some relatively big GILD acquisition is brewing and we might hear about it relatively soon. I just can't predict what it might be.

    BTW, I expect GILD to beat their EPS whisper of $2.92.
    Jul 19, 2015. 11:30 AM | 6 Likes Like |Link to Comment
  • China allows big boost in short selling  [View news story]
    Seems to me that given the Chinese pension to gamble, this could lead to a massive speculative short squeeze and ultimately a market collapse.

    It might drive prices much higher in the short term but I don't want to be looking for the exit when the panic starts!
    Apr 17, 2015. 08:48 AM | 1 Like Like |Link to Comment
  • Arcam: Aerospace Order From The U.S.  [View article]
    Based on what LAI does, it seems that the Arcam Q20 is the better choice for a production environment.

    The Arcam Q20 features:

    •Larger build envelope (bigger parts)
    •Higher productivity (faster)
    •Improved resolution (more precise)
    •Arcam LayerQam (camera system for real time inline quality monitoring)
    •Software adapted to volume production (tailored)
    •Closed powder handling (efficient use of powder)

    This is a great announcement, IMHO. I expect that this sale leads to many more from LAI in the future. Slow and steady march into the future!
    Feb 5, 2015. 06:46 AM | 1 Like Like |Link to Comment
  • What A Difference A Week Can Make In The Energy Sector  [View article]
    Personally, I would wait until after 4th quarter earning reports start coming out. I expect a fair number of misses, downward revisions, dividend reductions and maybe a few junior E&P's in serious financial distress. I think the magnitude and breadth will surprise people.

    If oil stays low, then 1st quarter '15 might be worse. When we start seeing the inevitable acquisitions of the financially weaker (albeit resource rich) players by the big boys, then I'll be back in--with both feet. That should signal bottom.

    Following the smart money has always been wise. In the oil patch that's XOM, CVX, Rich Kinder, Kelcy Warren, T. Boone Pickens, etc. (The confirmatory signal is the opposite of Goldman's call!)
    Dec 25, 2014. 07:52 AM | 11 Likes Like |Link to Comment
  • 3D Printing: Revolutionary Industry, Terrible Investment  [View article]
    Look to metals, like titanium, to be the future of 3-D printing. Industrial applications, not home enthusiast usage.

    3-D printing of complex parts for aerospace, automobile, orthopedics, machinery is where the Black Swan will hit and the revolution begins. GE, Whitney Pratt, Stryker, etc.

    Follow the dots:
    1. http://bit.ly/R1Cnqj

    2. http://bit.ly/1vZcJzM

    3. http://seekingalpha.co...

    Arcam will be a big winner within 5 years...
    Nov 8, 2014. 08:18 AM | 1 Like Like |Link to Comment
  • Accounting Irregularities Knock Down ARCP: Buying Opportunity Or Enron Part 2?  [View article]

    You make a strong case and you are probably right on most of your points. A purchase below $8 should give you a nice buffer as well. I'm out of ARCP and don't have a dog in this fight anymore I will watch from the sidelines.

    I'm not so sure that this was a one-off error or mistake.If so, why fire the CFO and CAO?

    In fact, the entire management team (including Schorsch) had a reputation of being "fast and loose." Marcato Capital felt strongly enough to issue a tightly worded statement after the Red Lobster deal imploring the management team to "pause on large-scale transaction activity and give investors a chance to see multiple quarters of clean financial results.” Back then they had 21.8M shares.

    Maybe nothing more will be uncovered. But I can't help but wonder whether the balance sheet will need to be restated (goodwill, assets, liabilities, etc). I wonder about any lending covenants--might they be triggered too? Might cost of capital rise too. We might still hear from large institutional investors who will move the needle if they start lightening up in any real way. Vanguard alone held 13% of outstanding shares--and they tend to be conservative. The SEC will be sniffing around soon.

    It can be hard to regain lost trust on Wall Street--so ARCP may spend some significant time in the penalty box, even if there is nothing else wrong. Can we discount a dividend cut?

    I just don't have the stomach for the risk here, but others may see an opportunity. Below 8...maybe?

    I think we'll get more chances at this over time as the dust clears.

    Oct 30, 2014. 04:23 PM | 1 Like Like |Link to Comment
  • Accounting Irregularities Knock Down ARCP: Buying Opportunity Or Enron Part 2?  [View article]
    You rarely find just one cockroach
    Oct 30, 2014. 03:15 PM | 1 Like Like |Link to Comment
  • Loving The Leverage: Wells Fargo  [View article]

    Yes, it is leveraged and something like a long dated option. However, these TARP warrants have some important distinctions versus options:

    1. These warrants adjust for quarterly dividends above a threshold--so that protects the warrant holder. Options lack this feature.
    2. These warrants adjust upward the number of shares they lay claim to based upon the dividend above threshold too. This is a nice feature that options lack.
    3. Also to consider, these options increase the float when exercised at expiration, which in WFCWS' case presently anticipate a 2.1% dilution of WFC shares. Although I expect that WFC will be buying back these warrants in the open market over time. One needs to factor in the dilutive effect of the new shares on the earnings model in 2018. This is the reason that traditional Black-Scholes model valuation doesn't work well for warrants (and if used will over value the warrant).

    I've been riding several of these TARP warrants for a couple of years and I love their performance--but I'd recommend that you be certain you like the underlying stock before reaching for the warrant.
    Sep 12, 2014. 03:02 PM | Likes Like |Link to Comment