pelican

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    • Tue Nov 18th 06:53 AM | Rating: 0 0
      Commented on:
      Philip Morris Continues to Smoke On
      You forgot to mention the strong dollar. This is what has been keeping the stock below $40/share in my view. That said, even if forward earnings projections are coming down a little, it still looks cheap. Plus, the company can buy back more stock which will help offset the affects of the weak euro. PM will continue to raise their dividend at least 10% annually and that means in five years the dividend will be about $3.50. Will PM stock remain flat over this time and eventually yield over 9%? I think not. This company is a license to print money and investors with a 5 year time horizon will be nicely rewarded.
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    • Thu Nov 13th 12:33 PM | Rating: 0 0
      Commented on:
      Citi's Desperate Straits
      "Citi closed on Wednesday at $9.64 a share -- a level which prices in a very high probability that the stock will go all the way to zero."

      Why? Are you saying that any stock that trades under $10/share has a "very high probability of going to zero"? Or is there another reason that the current price level is such a good indication that zero is in the offing? Please enlighten.
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    • Sun Oct 26th 10:15 AM | Rating: 0 0
      Commented on:
      Stocks Are Not Too Cheap
      I would have liked to see some metrics to back up your opinion. What is the foward p/e on the S&P 500? At what level do you think the p/e is reasonable?
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    • Sun Oct 26th 10:12 AM | Rating: 0 0
      Commented on:
      Don't Buy Into Share Buybacks
      I can't agree with you completely. You could have given examples of companies that have done relatively well and actively buy back shares, such as Philip Morris. Your PFE example is a good one, however, and in the long run the benefits of buybacks are at best mixed. I think it comes down to what the opportunities are. For some companies, buying back shares is better than overpaying for another company. Frankly, I'd like to see cash rich companies raise their dividends more. IMO that's a better way to return shareholder value.
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    • Wed Oct 8th 07:58 AM | Rating: 0 0
      Commented on:
      What Is the Fed Waiting For?
      "We have been calling for coordinated easing by central banks around the world..."

      Nice call Kathy. :-)
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    • Mon Oct 6th 07:16 AM | Rating: 0 0
      Commented on:
      GE Looks Very Attractive Here
      For the first time in 33 years GE did not raise its dividend this year. Over 40% of profits have come from their finance division. While I agree that GE is looking attractive, I also believe this bear market cannot be compared to the more recent bear markets. With earnings growth in 2009 expected to be zero to single digit, and maybe into 2010, I wonder if we are seeing another PFE; high dividend, good balance sheet, little growth. I see $18 as an entry point.
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    • Sun Oct 5th 12:29 PM | Rating: 0 0
      Commented on:
      S&P 500 Price Growth: 1927-Aug 2008
      SB-tiger,

      The S&P 500 has risen 11 fold since 1980 so I don't agree with you that equity investing has been "a complete scam". I read somewhere that over 80% of all five year periods dating back to the Great Depression has seen the market ahead; over 95% for ten year periods. We are experiencing a second major bear market in just the past eight years, something not too common, so the last ten year period is unusually terrible. I see further downside too, perhaps below 1000 on the S&P, but I plan to go shopping again at some point.
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    • Sat Sep 20th 10:48 AM | Rating: 0 0
      Commented on:
      If You Think the Dow Did Well Today, You're Wrong
      Thanks for pointing how wrong I was. My portfolio gained 4% today and I thought I should be happy!

      For ALL the reasons others have posted, this article shows you cannot be objective. You've lost credibility.
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    • Fri Sep 12th 17:42 PM | Rating: 0 0
      Commented on:
      The Lehman Situation: Brutally Logical, or Patently Illogical?
      Your article is one of only a few I've read that actually looks at LEH's situation rationally. Absolutely, with the Fed backstopping the investment banks there is no counterparty risk. My only guess is that investors, caught up in the hysteria, forget that.

      As to your points why LEH is trading below $4, I think its true many do not believe Lehman has correctly priced the value of its assets. But at the same time, they probably cannot tell you what the true value is, so it seems more of a nervous reaction along with the assumption that current book value is much lower. Hard to believe though that with all of LEH's writedowns, many quite aggressive, that the true value is that much askew from reality. In addition, even the rating agencies are not concerned about liquidity; rather, they see this as a problem of confidence, which sort of annoys me because they are basically making things worse. Finally, I think Lehman's 2009 EPS forecast is too high but as little to do with what's going on here. Most of the housing companies will lose money next year, for example, but most aren't selling below $4 a share (although their balance sheets are probably in worse shape).

      If more people looked at this logically like your article did, we would not be seeing the level of panic that we are, in my opinion. One article today reported the Koreans were willling to pay $26/share for 25% of the company just last month. But hysteria trumps reason in the short term and so LEH is in a pickle. I think Fuld has handled this situation horribly but its possible that he thought it would be patently illogical for the market to react the way that it has, so he didn't react quickly enough.

      And possibly a combination of all three. That’s where the brutal logic of the recent Lehman trading comes into play.


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    • Fri Sep 12th 17:16 PM | Rating: 0 0
      Commented on:
      Alternative Buyers for Lehman (and Not Just the Usual Suspects)
      Drivel.
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    • Sun Sep 7th 07:55 AM | Rating: 0 0
      Commented on:
      Forget the Moral Outrage: Just Restore the Mortgage Markets
      "For those who think that the common equity holders should be "wiped out", I question that sentiment."

      Its just my opinion but I don't think - and never did - it was a question of "should" or not. I always looked at it as a consequence of what needs to be done. Like a lion hunting its prey; there is no malice involved or moral judgement, the lion does what it needs to survive. As you wrote, "We need to get them capital in the least costly and quickest fashion that we can, reestablish a normal mortgage market and then deal with a longer-term vision." If they can do that w/o wiping out current shareholder, they will. If they can't....

      I can see a scenario, for example, where a reverse split is done (1:20) and then the government kicks in $5 billion and raises another $5 billion with the issuance of new shares at $10/share (an arbitrary figure but based on the number of shares outstanding, the new capital structure, etc.). Current shareholders would lose a lot - though not everything - but FNM and FRE would be in better shape and I think confidence would improve.

      I agree that shareholders are not to blame for this mess. I didn't blame them for Enron or Worldcom either. But they are suffering like any investor would when the company invested in turns out to be a disaster. Of course, until we know the details of the plan, its just speculation how current shareholders will fare. Still, I'm betting not very well based on statements Paulson as made in the past, what media sources have been reporting, as well as some legislators. In other words, in spite of the lack of details, multiple sources are saying it doesn't look good for current shareholders and so that's what I believe at this moment.



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    • Sat Sep 6th 02:34 AM | Rating: 0 0
      Commented on:
      Bill Gross: Politicking for His Own Bailout
      Thanks for the article. I lost some respect for Gross this year as he continued to make self-serving comments. Its so transparent that he sounds almost desperate.
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    • Mon Aug 11th 07:36 AM | Rating: 0 0
      Commented on:
      Financials: Bottoms Happen When Everyone's Convinced They Won't
      And don't forget FMD. What a disaster. To be sure, TB usually does the kind of forensic analysis that most don't. But does he know when to respect the counter-argument to his position? In my view, he's too quick to mock others if they disagree with his own analysis. To be fair, he's often right from a factual standpoint. No question. But knowing a company well is different from being correct with the buy/hold/sell recommendation. He made what I believe were great points regarding FMD; yet, the stock dived from $40 to $3. So what did he miss? And is he missing something now? Time will tell.


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    • Sun Aug 10th 09:49 AM | Rating: 0 0
      Commented on:
      Financials: Bottoms Happen When Everyone's Convinced They Won't
      Dang. How many articles are you going to write reminding us you strongly believe the bottom in financials is in? If true, I'll be the first to congratulate you, at least for identifying it, if not calling it prior to it happening. I know investments are an ego-driven business but I think we all get it...you're convinced July 15 was probably the bottom. Great. But contrary to what you wrote, you aren't the only one who thinks so. Barron's does (their second bottom call) among others; plus one or two who wrote articles that were posted on this blog. There's no question you're an intelligent guy and you may be right in your thinking. However, a lot of smart guys have been sucking pond water since last year, in part because they seem too cocksure of their position. When that happens, a disconnect between analysis and great stockpicking can occur. I think everyone agrees- and forgive the Yogi Berra-ism - that the unexpected happens when people least expect it. Witness the 40-50% jump in the major regional banks the last part of July. But many of the bears aren't just saying they want to see improving fundamentals before they invest. They are saying drawing parallels to the early 1990s, for example, is too easy and potentially unwise. I recall people comparing the '87 crash to the '29 crash, and many opted out of the market, some for good. Anyway, I'm not sure the financials have hit THE bottom last month, maybe they have. But seeing how the group rebounded so strongly after dropping 70%+ or so, is it really going out on a limb to say they have?
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    • Tue Jul 22nd 08:30 AM | Rating: 0 0
      Commented on:
      Steve Jobs' Health: A Red Herring
      I can't say I disagree with anything you say. But be careful blaming hedge funds for attemtped price manipulation - those paragons of morality - because you may be accused of being on a witch hunt. I think that's how it works these days. Anyway, I think the real question is why Apple lowballs its earnings forecast so much. If investors take it to heart, they they get screwed in the short-term; if they take it with a grain of salt, then what's the point because if Apple does come up a bit short on the "real" expected number, then the stock tanks anyway. After a while, investors get wind of the pattern and its probably better not to give projections at all.
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