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Zhang Fei

Zhang Fei
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  • Apple's Free Software Announcement - Much Ado About Nothing [View article]
    Corporate systems have different configurations from consumer ones. It's possible that your IT department has the computer run a quick virus scan every time it boots up. There's also a lot that goes on under the hood so that you can go to somebody else's computer, log on and do the same kinds of things you were able to do on your computer, including access your files. Consumer PC's don't have to deal with any of that. Of course, you can't log on to your daughter's home computer and access your files, either.
    Oct 29, 2013. 12:08 AM | Likes Like |Link to Comment
  • Apple Beats But Treated As Second Class [View article]
    But that Q1 had (1) a bigger product intro (5) than the prior year (4s), (2) a longer selling period for the 5 (intro'd in the last week of the prior quarter) vs the 4s (intro'd 2 weeks into the quarter) and (3) the addition of an agreement with China Telecom in January 2012 in the Chinese market for the 5 vs China Unicom alone for the 4s, so it's six of one and half a dozen of the other.

    However, what is intriguing here isn't the wrangling over what these other YTY comparisons mean. It's that an 8.7% increase in earnings has translated into a 4.8% decline in EPS. Despite a multi-billion dollar stock buyback. AAPL is issuing stock options hand over fist.
    Oct 28, 2013. 11:38 PM | Likes Like |Link to Comment
  • Apple Beats But Treated As Second Class [View article]
    "if it wasn't for the stock buyback, AAPL would of been unable to beat expectations. Since there were less shares to divide the earnings by, the eps went up.It is simple arithmetic."

    EPS went down, didn't it, despite YTY earnings for the quarter being up from $6.9b to $7.5b? It would appear that stock option grants exceeded stock repurchases.
    Oct 28, 2013. 09:29 PM | Likes Like |Link to Comment
  • Apple Beats But Treated As Second Class [View article]
    This appears to be the four consecutive quarter that a YTY EPS decline has been recorded at AAPL, in spite of multi-billion dollar stock buybacks. AAPL is issuing options to beat the band.
    Oct 28, 2013. 09:11 PM | Likes Like |Link to Comment
  • I Concede Defeat In Amazon.com [View article]
    "What's amusing is that even Netflix makes more money than Amazon."

    NFLX's valuation is staggering. However, its long-term viability is not in doubt - no one competes with it. And by compete with it, I mean offer all-you-can-eat streaming for peanuts while providing the most extensive buffet-style ad-free library in the biz by paying content providers untold billions. Nobody wants to be in that near zero-margin business. Not Apple, not Amazon, not Microsoft, and certainly none of the Hollywood content providers or cable channels, all of which are in the high-margin business of creating software/content for peanuts, while selling it for a king's ransom.
    Oct 25, 2013. 10:48 PM | 2 Likes Like |Link to Comment
  • Is Amazon A $500 Stock? [View article]
    I'm having considerable difficulty figuring out whether Arne is pulling our collective leg. His reasoning is similar to the analyst arguments (and investor hysteria) that made the internet bubble possible - a combination of "they'll make it up in volume" and "this time it's different". Why not simply admit that he's in the stock because it's got the Big Mo behind it, because investors can't get enough of it (for now)?
    Oct 25, 2013. 08:20 AM | 3 Likes Like |Link to Comment
  • Amazon.com Shipping Change Means The Earnings Miss Is Probably Massive [View article]
    "Oh, do you mean competitors like Walmart and Target which have $50 minimum purchase thresholds for free shipping? Think about it."

    Walmart has free ship-to-store with no minimum purchase.
    Oct 22, 2013. 10:37 PM | 3 Likes Like |Link to Comment
  • Amazon.com Shipping Change Means The Earnings Miss Is Probably Massive [View article]
    "Alibaba already has AliExpress.com as its US facing marketplace."

    Isn't that mainly wholesale quantities (i.e. 100 units and up)?
    Oct 22, 2013. 04:05 PM | Likes Like |Link to Comment
  • J.C. Penney: Why It Can Go To $18+ Per Share And Is Good For At Least A Trade [View article]
    Thanks for both the extremely informative article and the thoughtful responses to the criticisms leveled at the article.
    Oct 4, 2013. 03:40 PM | 1 Like Like |Link to Comment
  • J C :Penney 1 Year Default Probability 2.80%, Up 0.09% Today [View instapost]
    Great article. Thanks for the update.
    Oct 2, 2013. 01:36 PM | Likes Like |Link to Comment
  • 3 More Things You Need To Know About Amazon.com [View article]
    "You mean when solid companies like Cisco were P/E 200? wrong-wrong... wrong-wrong

    Must have been before your time."

    The internet bubble burst in March 2000. CSCO's last annual report before that report: http://bit.ly/16NLX0g

    Refer to page 33 for the revenue numbers.
    Sep 30, 2013. 12:31 AM | Likes Like |Link to Comment
  • Peabody Energy: Ridiculously Overvalued Despite Poor Industry Outlook [View article]
    "as well as solar energy farms in the desert ... "

    That seems to be for show more than anything else. A negligible amount of China's power is provided by expensive alternative energy schemes, which pencil out out to at least 25 cents per KWh, way too expensive for China's needs.
    Sep 29, 2013. 06:27 PM | 1 Like Like |Link to Comment
  • Peabody Energy: Ridiculously Overvalued Despite Poor Industry Outlook [View article]
    "Cn is building nuclear plants"

    Nuclear plants do provide cheaper energy, if some of the safety measures are omitted. One major nuclear accident though, and the 10 plants a year goes out the window. A shoddily constructed bridge that fails will kill perhaps dozens. A badly-constructed nuclear power station the goes south is a horse of a different color.
    Sep 29, 2013. 06:22 PM | 1 Like Like |Link to Comment
  • Peabody Energy: Ridiculously Overvalued Despite Poor Industry Outlook [View article]
    "a simple google search will reveal that the Chinese govt is going toward building additional nuclear power plants. 17 under construction now with plans for an additional 200. But it's a good theory."

    China has a lot of ministries and a lot of self-appointed spokespeople, many jockeying for influence in the party and/or bribes related to large capital projects. What some government flack says on behalf of his department head may never materialize. A lot of these statements are made to give the projects an air of inevitability when the money hasn't even been allocated. China has less than 20 nuclear plants today. To build 10 a year and 200 in total represents a staggering rate of construction. Color me skeptical.

    Nuke plants require infrastructure to process nuclear material. Here's a sample of what's in store for any large scale increase in nuclear processing plants: http://bloom.bg/18zH3Hc

    Meanwhile, interest in coal gasification is proceeding apace: http://on.ft.com/18e2JtB
    Sep 28, 2013. 04:26 PM | 1 Like Like |Link to Comment
  • Peabody Energy: Ridiculously Overvalued Despite Poor Industry Outlook [View article]
    "your missing the point that root is making. If china decides to get away from coal it will happen in a much more rapid fashion then if it was another country."

    My point is that without quantifiable benefits, China will not move away from coal. Economic growth is what keeps the party in power, and the factions within the party from reaching for each other's throats.

    In addition, a major nuclear accident could be more than a black eye - it could threaten the regime's existence, given that its whole raison d'etre is its claim to managerial competence. A train crash that kills dozens can be explained away. A nuclear accident that kills tens of thousands is something else. Note that Japan has not had a bullet train incident involving fatalities in 50 years of operations, whereas China has had one involving 40 dead in just 4 years of operations. Meanwhile, Japan has had the Fukushima meltdown. A major natural disaster could trigger something similar in China, probably on a far larger scale, given the Chinese propensity to cut corners and their disdain for safety measures.

    The leadership is aware of these issues and knows that even the economic stats are fudged. Given the stakes involved, I'd expect the Chinese to move away from nuclear power rather than towards it. Bottom line is that coal, being the cheapest fuel source for power stations, is the way ahead for China. They may shut down and refurb existing power stations to install smog control equipment, but that's about as far as they'll go.
    Sep 27, 2013. 11:49 PM | 2 Likes Like |Link to Comment
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613 Comments
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