Mexx

Will Water ETFs Be 'Blue Gold'?

I also favor ETFs, in particular CGW, as a way to play the water theme -CGW has a 7.68% yield, has a reasonable 0.70% expense ratio and provides exposure to some of the most important water players around the globe (and thankfully GE is not one of their top 25 holdings).

While I agree that water is a public good, the macro landscape will bode for long term investors who believe providers of water infrastructure services and equipment (i.e, treatment, transport, regulation, safety, environmental, etc) will benefit from this global trend. Municipalities, and governments around the globe will pay top dollar to these providers to develop or update their water infrastructure that will be financed through bonds, tax payer money, etc, how water prices are regulated to the end user is another matter.

Jamba's New CEO Providing a Boost

Thanks for the analysis and update on JMBA.

The next 12 months are make or break for JMBA. Aside from good execution from its new management, the company will need all the stars aligned to its favor including:

> Stability in the CA economy (i.e., job market and house prices stabilize).
> A hot summer in CA
> Commodity prices remain at current levels and raw materials do not spike
> Gas prices stay the same
> SBUX, MCD and Dunkin fail miserably at their smoothie attempts.
> Travel picks up

I've come to realize that JMBA's survival not only depends on their ability to execute but on the above strong external foces to be continually aligned on its favor for a sustainable period of time. It is a tough bet.

JMBA remains a speculative play, only put your Vegas money on this one.

NYSE Euronext: Rebound Likely

After todays drop due to analyst downgrades, NYX is looking cheap. The fact that analysts are turning bearish on this stock I believe is a sign that this sotck is bottoming out. By every measure: EV/EBITDA= 2.8, book value =$34, PEG =.54, the stock is becoming a bargain.

Ten Micro Predictions for 2009

Good entertainment value, that is about it.

Anyone taking Eric's predictions more seriously than that is a total fool.

For Many Akamai and On2 Investors, Emotions Clouding Their Judgement

ONT is a PR machine issuing press releases every few days just to keep themselves relevant. Other than that, don't expect to make much investing in this company.

IT Industry May Slump Until 2010

Oh goodie, it looks like I have two more years of buying great companies.

Eventhough we are melting down.... this is a great period for the long term investor to continue accumulating steadily.

Ceradyne: Tremendous Growth with Major Risks

Agree. But looking at the concentrated revenue risk from a different point of view. As long as we have enemies and the risk of a terrorist attack looms. There will be no major cutbacks on defense spending. McCain winning will give this stock a bump while Obama winning will keep this stock flat. We can alway pass $700B bills in the event we get attacked and need to raise military spending.

Credit Cards and Exchanges: The Only Safe Ways to Play the Financials

Good article. I like NDAQ and I'll patiently wait for another market panic attack to see if I can get the stock to dip below $30 so I can have a bit more of a safety cushion. Thnxs

Dryshippers: A Buy or a Sell?

Good article. I've owned GNK for a while, and have seen the up and down swings on the stock - the Chinese are living off their inventories right now but cannot do it indefinitely. Demand for coal and other dry goods will return and the BDI will soar.

Top 5 Stock Picks for September

Chris,

I thought AUTH was expensive even at its current lows, but man, I never thought it would drop this much in one day. I feel for you, I've had my share of micro-caps dropping more than half in a short-time -this truly sucks.


Given the drop and the potential risk of losing one of their biggest customers, I am curious to know from you, is this an over reaction or was this drop well justified?

Buy-Don't Buy?

Five Retailers for Falling Gas Prices

Cheaper oil will not solve for the real estate crisis we are currently in. I agree with 2 lakes, there are broader issues at hand that may keep people out of the stores for some time to come. I am not convinced we have hit consumer spending bottoms, nor I think that these stocks just because they have dropped more than 50% can be considered cheap.
> CMG is far from cheap with a forward P/E of 24 and a EV/EBITDA of 13.25
> DKS is probably achieving cheap status and has a solid business model and OK balance sheet. But much of its diversified inventory makes it susceptible to consumer discretionary spending. I would consider buying if it drops another 15-20% as a margin of safety.
> SHLD - There is not much of retail business model here. The retail experience sucks and if you've been to a Kmart lately you'd think you just walked in to a Bloomies because it's so pricey. Lampert is clearly way above his head on this one, he is not a retailer. The real estate angle on this one is not good enough reason to buy.
> KONA - A want to sell everything sushi/pizza/burger/tac... with a twist of hawaiian restaurant. No thanks. BWLD yes.
> JMBA - Total speculation. Put your Vegas money on this one and be ready to hold for 5 years.

The Case for Jamba Juice

Matthew, I've already place my bet in the Jamba roulette -that bet is long.

While I concur with some of your points, most of your points are too anecdotal or tactical to make a case for Jamba either way.

There is a lot of pessimism built into the stock, at this level, the numbers don't mean much, the fact that it trades below book is meaningless, there are lots of micro-caps that fit that profile (e.g., VIMC, FMD come to mind).

Nonetheless, I think it comes down to three things:

Unique Value Proposition (UVP): The fact that MCD, SBUX, Dunkin, and everyone else has jumped into the smoothie business simply validates the Product category and exposes more people to the smoothie concept. Competition is alive and well, it may be in very fragmented market but it is there, and lets not forget all the near perfect substitutes in the ready to drink market. So the question is can Jamba create a UVP that can help differentiate itself and help grow their biz. model. My answer is maybe. I think serving quality drinks is a great start, but they have a bit to go in the in-store experience, your example of the 6min. brings to light the in-store issue.

Management: Contrary to other's opinion, I think management is quite competent. Their marketing is stellar, they understand operations and are lasered focus on creative a memorable customer experience so that they increase customer frequency (a key metric). Scoring the Nestle distribution deal in the RTD market by leveraging their brand was a stroke of genius. They are keenly aware of service, throughput, sizing/pricing and are working hard on fixing them. Unfortunately, that leaves little time and money to respond to indiv. shareholder letters. Judging Management responsiveness by the fact that they did not respond to your letter is a bit... petty.

Profitability: It is absolutely critical for Jamba to figure out how to make money on a $2.95 drink and still fulfill the brand promise and deliver a UVP. The scalability of the business, the mass market appeal, and most importantly the ability to make money over the long haul rests in making the $2.95 drink work for the business. This is where the futures market could come into play, along with some tight controls over operations and cost containment.

Bottomline, we are clearly in long-term speculation territory. At the next earnings meeting, pay attention to the three things above, everything else is short-term noise.

Breaking Up With Jamba Juice

bail out. My second closing thought is that this should be part of your speculative plays in your portfolio. Only put in what you can afford to loose.

Who knows, we could be looking at the next RIMM, circa Sep 30, 2002.

Breaking Up With Jamba Juice

rushnut,

In my view at this stage, it is less about the numbers (because there are several metrics that could help you justify goin in from a deep value perspective); and more about the strategy, business drivers and their ability to execute on that strategy.

Nonetheless, the two numbers that are worth keeping attention are Profitability and Cash Flow. It will be specially interesting to hear what they are doing about Profitability (or whether the existing plan is working to keep them above water) and their plan to generate FCF.

Aside from that, these are the things that will make or break the company or are things that you need to consider to determine whether to invest in JMBA or not.

PROS
A Strong Brand - You cannot discount their position in the market, they are truly the #1 brand in the marketplace.

Their product as a valid category - SBUX, Dunkin Donuts, MCD are all jumping into the smoothie market. With the possible exception of dunkin donuts, i think they are all going to fail, but along the way they would've introduced a broader market into the product category.

Nestle Distribution: This is a limited distribution agreement at the moment, but if it expands nationwide or internationally, it could certainly pave the way for JMBA to become a national brand both as a retail out and in-store

Management - To date, their management has proven very competent. They are good marketers and good operators. For good or bad, they are focused on execution and not the stock price.


CONS
> Cost of raw materials -the rise in milk, fruit and just about everything else that goes into their drinks. With cost of goods going up their margins are continually being squeezed. This is the one that I think is the hardest to solve and the one that bothers me the most because it affects their entire business model.

> The California Economy - Their concentration in CA makes them particularly suspectible to its economy. If you believe CA will whether out the real estate slump, Jamba will do well.

> Price Point -Their price points may be to high to make Jamba a truly mass-market product. Their concept is more like a Fudruckers than a McDonald's in the burger space. It will interesting to see how they do with their $2.95 drink offer.

Two closing toughts, if you put money in, go into it with a five year horizon, without any regard of what happens in between. Obviously Greg Gerber the writer of the original article had a much shorter time horizon and decided to .

AuthenTec Earnings Highlights: Record Sales, Continued Execution

Chris,

I've had AUTH on my watch list since the beginning of the year. I've seen it drop about 35% since. However, after yesterday's stellar earnings announcement, I am scratching my head wondering why the big sell off today. Do you have any insight into why the market reacted so negatively to their quarterly earnings.

Are the big boys seeing something that we are not. Any insight would be greatly appreciated.

Mexx