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bornskeptic

bornskeptic
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  • General Electric In Focus [View article]
    Immelt will show his true colors in the way that he balances his supposed "shareholder focus" with his own self interest. One of his compensation incentive goals is to improve cash position which would seem to be in conflict with increasing dividends. Despite numerous positive opinions like the author's, long-term (>6 or 7 years) shareholders have not been rewarded by holding GE. Maybe that will change someday, but none of us lives forever.
    Nov 26, 2014. 11:46 AM | Likes Like |Link to Comment
  • General Electric Is Rising From The Ashes [View article]
    I don't think it is remarkable or significant that the stock has "run up quite a bit in the past month" when it is still below where it was 12 months ago, while the market has risen, what, 29%? And now you are waiting for a pull-back? If you set your goals low enough, you might be satisfied with a 3.3% dividend, but I don't think that is anything to toot your horn about. GE has underperformed its peers and the market for so long that anyone still mindlessly hanging on to hope that it will "bust out" any time soon is dreaming, and losing money. Ask yourself, what good will it do stockholders if Mr. I meets his goals? Good for him, not good for them. The least he could do would be to boost the dividend toward where it was before he said it wouldn't be cut, but that won't happen now because of his self-interest.
    Nov 19, 2014. 05:17 PM | 2 Likes Like |Link to Comment
  • Procter & Gamble: Pruning For Faster Growth [View article]
    I happen to be long PG right now, so I welcome positive opinions like this one, but we all know what opinions are like.
    This article gave me a nice warm feeling, but it is just another example of the kind of fluff that SA publishes ad infinitum.
    Where is the beef? If this is a positive development, what does that mean? Does the author have an estimate of the impact on earnings over time? P/E? Stock price? Dividend? Yield? Is this fully reflected in the current price? Is PG over-priced, under-priced or priced just right now? Should I buy, sell or hold? What circumstances would alter the author's opinion?
    No help here. After reading this article, I know no more or less than I did before about the merits of owning PG.
    Keep the extra penny.
    Correction: To be fair, I did learn something; I wasn't aware that "Always feminine care products in the US are branded as Whisper in Asia". That is an interesting bit of trivia.
    Aug 5, 2014. 03:01 PM | Likes Like |Link to Comment
  • General Electric: Alstom Is Slipping Away [View article]
    Let's not overlook the fact that GE will have to deal with the French politicians after a deal, if there is one. If the politicians are against the deal, playing games with GE and making it tough to do the deal in the first place, how does GE expect to be treated afterwards? Does GE really think that they can be successful in that kind of an environment? As an analogy, can there be a happy marriage when the in-laws are against it?
    Jun 16, 2014. 12:17 PM | 1 Like Like |Link to Comment
  • Alstom Desperate, General Electric Moves In For The Kill [View article]
    Your assertions about GE and Mr. Immelt seem to be illogical and mutually exclusive. Mr. Immelt can't be "one of the best CEOs" if the company he runs is "underrated" and vice versa.
    May 7, 2014. 01:30 PM | 5 Likes Like |Link to Comment
  • General Electric, Alstom And The French Government [View article]
    The one thing that no one seems to have picked up on, yet, is that the government is Alstom's major customer, accounting for something like 75% of Alstom's business, I believe. As such, the government has a great deal of leverage. I doubt that Mr. Immelt could make the deal successful without their continuing support.
    May 6, 2014. 01:35 PM | 1 Like Like |Link to Comment
  • Don't Buy Cisco Just Yet [View article]
    At the close, 12/18/2013; DJIA +1.84%, S&P +1.66%, NASDAQ +1.15%, all sector indexes up at least 1.16%. CSCO +0.43% Remind me why we are even considering an equity that clearly does not perform as well as major averages or index ETFs. Compare with JNPR +1.57%, or XOM, KO, or JPM. Are they not under the same "macroeconomic pressures", blah, blah, blah?
    Dec 18, 2013. 04:21 PM | Likes Like |Link to Comment
  • Don't Buy Cisco Just Yet [View article]
    It says it all when the company has nothing better to do with its (shareholder's) assets than artificially support the share price in the face of lackluster performance. Doesn't it?
    Dec 18, 2013. 02:29 PM | 1 Like Like |Link to Comment
  • Cisco: Unloved, Undervalued, Misunderstood And Loads Of Income Stream Potential [View article]
    I enjoyed this article for two reasons. First, because I am, regrettably, long a small investment in CSCO since the late 1990s. More so, because I find it more amusing than informative when anyone makes a few simple assumptions, then extrapolates and compounds them for 30 years, particularly about a technology company.

    However, considering what CSCO has done for the past 29 years, I am not persuaded that its next 30 years will be just one smooth upward climb. And what about the extrapolation of the cost of living, taxes, the federal debt and deficit, and the value of the dollar? Even in a peaceful and financially stable world, I wonder if I would really be able to “live on and enjoy retirement” on $35K-$50K in 2043 and beyond. That’s nice, but not a lofty target, even for 2013.

    If we are going to indulge in this sort of fantasizing, why not choose a company that already has a 50-year record of reliable dividend increases? If dividend growth is the strategy you recommend for a comfortable retirement, Coca-Cola and Procter & Gamble come to mind, but Cisco? Really?!

    Look at the companies that have been best to have in a 401K for the past 10 years; Apple, Cliffs Natural Resources, Coach, CarMax, Southwestern Energy. Will they continue to be top performers for another 30 years? Probably not. Neither will Cisco.
    Dec 16, 2013. 05:46 PM | 1 Like Like |Link to Comment
  • General Electric: 6% Yield And Nearly 30% Upside Potential [View article]
    Doesn't anyone recall, not so long ago, when FDIC-insured banks paid 5% - 5.25% on savings accounts and gave you a set of steak knives as a bonus? A zero-risk one-year CD was 6%.
    Let alone, 18%. And that was without the Fed pumping $85B/month into the economy for years prior.
    When, before 2008, have interest rates ever been this low?
    Banks have been recapitalized on the backs of savers and fixed-income investors, like my grandmother who depended on CDs to make ends meet. That's what you call redistribution of wealth.
    I just can't get excited as you are about a 6% return on risk capital. That's all.
    Dec 6, 2013. 04:29 PM | 3 Likes Like |Link to Comment
  • General Electric: 6% Yield And Nearly 30% Upside Potential [View article]
    Anyone who thinks that interest rates will not rise in the next 5 years has not been paying attention.
    When they do, and they are already trending up, if you haven't noticed, the price of this debt security will fall farther and it will be a long, long time before you can sell it for what you paid for it.
    Don't expect GEK to be called early. No one calls in debt in a rising interest rate environment. Besides, once it is spun off from GE, GEK will have to stand on it's own creditworthiness, so it's borrowing costs will only go up.
    Your 28% capital gain at maturity is 0.6% annually over 40 years, so forget about that.
    If you like a 6% return on your investment for the next 40 years, go for GEK. It's a lot better than you will get from your bank, for now.
    If you are aspiring to something better, look for a solid growth stock. Even a mature mega-industrial like GE has a chance of doing better in that time frame. Take a look back at the 1973 price of GE for perspective. A $100 investment grew to over $7,500 today.
    Dec 6, 2013. 04:05 PM | 3 Likes Like |Link to Comment
  • Will 2014 Be The Year Of General Electric? [View article]
    That's a long way to go to get to your conclusion, "I don't see why it should be anywhere near expensive. If the company can execute on its plans and continue to return cash to its investors, 2014 can easily be the year of GE." which sounds so positive and warm and fuzzy, but is meaningless. Your well-reasoned price target would be so much more satisfying.

    It seems like you conclude that the stock price will remain about the same as it is now, so as not to get "anywhere near expensive" with a P/E in the low teens. Don't all of the positive developments that you foresee argue for a higher P/E rather than lower?

    As a GE owner, I would prefer to think it will be way more than "anywhere near expensive" at the end of 2014. I also care more about the P than the E, though, of course, they are loosely related.

    So, I still don't know if you believe GE is a good investment or even a better choice than any other investment I might make. So what was your point?

    I just love these fluffy analyses on this site. Where is your conviction? Maybe next year will easily be your year? Or mine? Who knows? Happy New Year!
    Dec 3, 2013. 07:51 PM | 4 Likes Like |Link to Comment
  • Beaten-down American Capital Mortgage (MTGE) sees a big buy, with Pine River Capital (they run TWO Harbors) reporting the addition of nearly 4.4M shares to its previous 1M share stake. The stock's off nearly 40% since an ugly Q1 earnings report in early May (along with sister-company AGNC) was compounded by the fast rise in interest rates since. [View news story]
    Live by leverage, die by leverage. The Fed's action was not unexpected and the vaunted Mr, Kain supposedly hedged, but the stock price action leads me to believe that it was not very effective. Does Pine River know something that the rest of us do not?
    Jul 9, 2013. 01:38 PM | Likes Like |Link to Comment
  • Cashed Up Biotech Vanda Could Keep On Falling [View article]
    If you want to see where Vanda is going, take a look at the history of Titan Pharmaceuticals (TTNP, formerly TTP), the previous in-licensee of Fanapt (then Iloperidone). Steady march downward, then delisted, now OTC-BB. I speak from experience. I've seen this show before.
    Nov 6, 2012. 11:56 AM | Likes Like |Link to Comment
  • A Chinese Commerce Ministry spokesman warns a House committee report urging U.S. companies not to use Huawei and ZTE's gear will "undermine cooperation and development" between the U.S. and China. Arik Hesseldahl notes Cisco (CSCO), which derives 16% of its sales from the Asia-Pac region and just ended its partnership with ZTE, has plenty to lose if a "telecom trade war" breaks out. An EU anti-dumping case against Huawei and ZTE has been delayed[View news story]
    On the other hand, we can't ignore the fact that China holds $1.15T of US debt and we will want them to loan us even more in the future, on favorable terms. Every action has an equal and opposite reaction, I'm told.
    Oct 11, 2012. 10:56 AM | Likes Like |Link to Comment
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