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just sayin'

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  • Barring An Increase In Iron Ore Pricing, Cliffs Is Insolvent In The Medium Term [View article]
    Interesting assessment thanks for the reply.
    Feb 14, 2015. 07:00 PM | Likes Like |Link to Comment
  • Barring An Increase In Iron Ore Pricing, Cliffs Is Insolvent In The Medium Term [View article]
    If the company is in such bad shape - then why does a guy like LG sign on?
    Feb 12, 2015. 11:14 PM | Likes Like |Link to Comment
  • Thoughts On Cliffs' Conference Call [View article]
    I believe we were misled about the dividend in the Q3 call. LG said he was going to recommend that the board keep the dividend. This time he backpedaled and said he recommended they keep it for Q4. What? While technically correct it sure feels like misdirection. Help me out here if you heard that call and I am incorrect.

    Nonetheless it is obvious they should cut the dividend considering the circumstances.

    Even if they are buying debt at a discount they are still using up cash to do it. Eventually they will need more cash. I believe a secondary share offering could be the most cost effective way to do this. Bond yields are not favorable to CLF and credit facilities have interest payments. Stock offering is the cheapest way to acquire $.

    My gut tells me current management is crafty enough and they have enough cards to play to avoid chapter 11. It is a possibility though particularly if they lose key customers or global pricing pressure gets a lot more serious.

    I'm long shares now but looking for a better entry point to expand my position.
    Feb 8, 2015. 07:39 AM | Likes Like |Link to Comment
  • It's Earnings Season---So Here Come The Crooks, Led By Alcoa [View article]
    All of the write-offs are disclosed in the SEC filings. Management is telling you these are one-time items - it's not like they are skipping it entirely. Think of it like the surgeon general warning or the fast talking disclaimers in commercials. They say those words to downplay it. Do you expect a CEO to come out and say "we did a bad job"?

    I fail to understand how AA is significantly different than every other >$1B publicly traded company. A quick check shows me that >67% of AA shares are owned by institutions. Are you telling us they are all sheep and not reading the SEC filings?

    Rather than crucify AA perhaps it is a system that you do not like in which case a more constructive activity would be to get it fixed or learn how to play it.

    In my book you either a) cannot or will not adapt, or b) you want the share price lower.
    Jan 14, 2015. 12:21 PM | 9 Likes Like |Link to Comment
  • Huge showdown brewing in Washington over 40-hour work week bill [View news story]
    Instead of 29 hrs a week now it can be 39 to avoid the healthcare tax. This just means fewer part time employees for a company to deal with. Call it opportunity - now two part time jobs can get a person 78 hours of work per week.
    Jan 9, 2015. 12:54 PM | 1 Like Like |Link to Comment
  • 2015 Outlook: Pain [View article]
    If bullish sentiment is so high why are treasury yields still so low? I really thought those yields would start moving up in 2014. I also can't quite reconcile why gold has not fallen further out of favor. Seems to me that part of capitulation is when all the money is going into stock.
    Unscientifically, the dot-com and pre-great recession highs did not seem as full of doubt as we are now.

    I suppose more digging is in order to reconcile these items.

    At current valuation levels it is hard for me to beat the market. The exit of the next crash is where I am going to make a fortune so bring it now!
    Jan 2, 2015. 07:17 AM | 1 Like Like |Link to Comment
  • 2015 Outlook: Pain [View article]
    I cannot pretend to know all the factors that could drive equity markets up or down, but I do not believe investor sentiment is going to drive them down in 2015 because there are still too many bears. We have not yet had our irrational exuberance moment and the time it takes after that to really get the downtrend started.
    Jan 1, 2015. 07:03 PM | 1 Like Like |Link to Comment
  • Alcoa: Enough Selling Already [View article]
    Not very scientific. In the 12's they have retraced about 50% from recent high near 18 from recent low near 8. They have spent relatively little time below 10 in the past 5 years. Over the past several years we have seen steady change by closing underperforming assets and expanding/building more all the while sticking to improving operating efficiencies and cash flow. The company has to have more potential to generate profits than before. If we get back to oversupply of aluminum it will take longer for me to be right. None of this factors in any changes due to the change in energy prices which I presume is a tail wind.
    Dec 17, 2014. 07:54 PM | 2 Likes Like |Link to Comment
  • Alcoa: Enough Selling Already [View article]
    Price still in no mans land here in my opinion. I am a little sad AA corrected but as a long time shareholder this is not a big surprise. When the shares get cheaper I'll start adding. I would be very interested at $10 but will probably start adding around $12.
    Dec 17, 2014. 07:00 AM | Likes Like |Link to Comment
  • Bank Of America: Are You Ready For The Next Move To The Upside? [View article]
    In this case there might have been some overhang based on bad decisions from the prior management that was not fully baked into the share price. Nothing to see here. Moving right along...
    Dec 14, 2014. 02:49 PM | Likes Like |Link to Comment
  • Freeport's Oil Purchases Seem Like A Mistake [View article]
    While it seems clear FCX overpaid for these assets, the diversification strategy is not that different from what BHP or RIO is doing. In the long term the overpayment will work itself out and the cronies that were on the FCX and McMoran boards will get away with it. I do not believe FCX is not going out of business as a result of this mistake though it will create opportunities for investors as the disdain for this approach gets baked into the share price. Eventually the commodity prices will turn to their favor once again.
    Dec 9, 2014. 07:03 AM | 4 Likes Like |Link to Comment
  • Bank Of America: Are You Ready For The Next Move To The Upside? [View article]
    I am long BAC (about 6% of my portfolio) and I have some calls and put spreads. The shares are up 201% since I bought them. The calls come up in January and it looks like the $17 calls are going to be good. I also have some $20 and $22 calls which are longshots at best right now - I'm hoping you are right and we get a big boost off earnings! The put spread is Jan 2015 15-10 and so that looks like a high probability payoff. Bought all these when they were still leaps. Certainly thought the legal issues would have cleared up and interest rate increases would be priced in by January so the shares would be higher by now. The options are a very small part of my portfolio as I get my "sea legs" in that area.

    My point is that while it seems clear that BAC will return to similar valuation to its peers in the sector it is less clear if something macro economic will negatively impact near term growth and share price (in 2015). Weakness in global economic growth creeping into the US is one possibility. Sometimes the catalysts take longer to arrive than is expected.

    Also I can't really agree that BAC is one of the "most hated" stocks it is up 13% YTD. Try owning FCX or RIG and a host of others sporting significant losses in 2014. Unscientifically the investor hate for BAC is about 80-90% done IMO.
    Dec 7, 2014. 08:50 AM | 2 Likes Like |Link to Comment
  • Rally in utility stocks "getting long in the teeth" [View news story]
    As bond yields start to rise I could see some pressure on this stock but the signal is not strong enough to make me want to sell at this time. When it went under $67 in October I should have added but I was asleep at the switch.
    Dec 6, 2014. 10:53 PM | 1 Like Like |Link to Comment
  • My Bullish Case For Cliffs Natural Resources [View article]
    Looking at BHP and RIO I see diversified businesses not just pure iron ore play. Both produce copper, aluminum, uranium and other things. Hard to compare that apples to apples.
    Dec 6, 2014. 07:33 PM | Likes Like |Link to Comment
  • Expect Cliffs To Terminate The Common Stock Dividend [View article]
    Since LG is being aggressive and making moves I expect that all is not as dire as it seems or the dividend would already be gone. On the call he said he would recommend to the board that the dividend continues. My best guess is they will take damage but survive and eventually return to prosperity. If that damage includes suspending the dividend so be it. At this point who is really here for the dividend?
    Dec 6, 2014. 11:55 AM | 3 Likes Like |Link to Comment
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