American Capital, Ltd.: Too Good To Miss [View article]
Another reason for the drop is that John Paulson has been forced to sell, presumably because of his hedge fund investors redeeming their holdings in his fund. That should be done now.
Cray: Are Super-Computers A Super Business? [View article]
Aside from the lumpy earnings, CRAY has a great balance sheet, and I do think that it's ripe for a company like IBM to come purchase it. Also you do see they win international wins as well, from climate centers and other academic concerns.
Use Today's Sell-Off to Pick Up Freeport-McMoRan, A Beaten-Up Copper and Gold Miner [View article]
Dammit, Bret! Every day you have some tempting picks but there is not enough cash to go around (or buy all and have 'diworsification'). I am still looking into your previous picks such as EMR, AGCO, VOD, etc. How about an article of your top 10 or highest conviction stocks? :)
Annaly Capital Management Looks Even Better as the Economy Crashes [View article]
investor987 - I have "kept my eye" on NLY for a few years now, expecting some sort of huge fallout like what happened to FRO (different industry, but previous high-yield flyer). But this thing is still going strong, and I have missed out on probably $8 in dividends to date! That kills me!
Why Microsoft Should Borrow Heavily to Buy Back Shares [View article]
Funny how this hedge fund used AZO as an exhibit. Eddie Lampert and RBS Partners have absolutely squeezed AZO of all shareholder equity and then some. It amounts to a slow and steady LBO. Not saying Microsoft would come close to turning out like that, but AZO has taken on immense amounts of debt to fund the buybacks -- and they cannot stop or EPS growth will screech to a HALT. One day AZO will have to file for bankrupcy protection, long after Eddie Lampert laughed his way to the bank. AZO's quick ratio is a laughable 0.07. Shareholder equity went from $25 a share in 2001 to -$19 a share in the latest quarter (Morningstar financial health ratios). There is over $3B of debt on the balance sheet with less than $100M cash.
Curious why you prefer the LEAPs. If you owned the underlying, you could pick up the dividend and not have to deal with time decay or premiums to stay in it. Are you buying out-of-the-money calls to bet on a sharp turnaround?
3 Companies Undervalued Based on Cash Flow [View article]
Thanks for the analysis. I own TSRA, but have avoided the teen retail sector due to customer fickleness. I like ARO and BKE but have just watched them until now. What is your take on the skyrocketing of cotton prices? I am wondering if the whole sector will take a hit once that hits the raw inventory costs. Retailers will not be able to pass that cost along to the consumer quickly enough.
Actions Semiconductor: A True Chinese Value [View article]
There are any number of small Chinese stocks trading near or below cash value. I held XING and QXM for a long time, under water, until recently they were able to go up (OK, they went from telcom to molybdenum mining, kind of a dubious switch). I also had NTE (Taiwan) stock when it was trading at cash value. Waiting now for AOB which has not done well for many years (sunk a chunk of cash into real estate instead of their core business). I am not confident on AOB. The key here is to diversify your Chinese holdings.
5 Stocks Due for a Pullback in 2011 [View article]
I'm bearish on Netflix, but to question whether the company will be around in 5 years is quite unrealistic. The company has a very recognizable brand name, is popular with young professionals, has a proven recommendation engine, and has managed to maintain a foothold in the on-demand streaming space (how many people actually know what Vudu is, etc.?). Yes, there are some strong contenders making their way in (the new AppleTV for example).
All fine but the stock has run up way too high. I'm interested in shorting when the death cross occurs.
Overhauling the Numbers With AutoZone [View article]
Chris, great analysis. I've long felt that ESL and his boutique RBS are doing a slow LBO, crushing shorts (myself included). This stock defies technical analysis because of the heavy and very consistent buybacks. The board seems to authorize $500 million buybacks like clockwork.
They also seem to be able to maintain their (barely) investment grade bond rating to keep borrowing at low rates. I would love to see a surprise downgrade of their bond rating as this would pulverize the stock price instantly, but I think the board and CFO are too smart to let that happen.
Autozone’s Price-to-Sales Ratio May Dampen Future Performance [View article]
superpatrol,
Great cash flow but the company is using more than free cash to fund the buybacks. LT balance sheet debt has been going up for the past few years. It's akin to a slow LBO. It's not to say it's a bad strategy if they think they can maintain the free cash and make all the interest payments and maintain their "investment grade" bond ratings (actually one notch above junk so it seems). In a few years when the float is very small, they might be able to do a killer short squeeze like that of Porsche/Volkswagen.
American Capital, Ltd.: Too Good To Miss [View article]
Cray: Are Super-Computers A Super Business? [View article]
Use Today's Sell-Off to Pick Up Freeport-McMoRan, A Beaten-Up Copper and Gold Miner [View article]
Use Today's Sell-Off to Pick Up Freeport-McMoRan, A Beaten-Up Copper and Gold Miner [View article]
Annaly Capital Management Looks Even Better as the Economy Crashes [View article]
Why Microsoft Should Borrow Heavily to Buy Back Shares [View article]
Comtech Telecom: Past or Future [View article]
Odd - the CFO and CEO have been buying shares on the open market recently. Vote of confidence or no? The buys were larger than "nibbles".
finance.yahoo.com/q/it...
SuperValu: What's Not to Love? [View article]
3 Companies Undervalued Based on Cash Flow [View article]
Actions Semiconductor: A True Chinese Value [View article]
5 Stocks Due for a Pullback in 2011 [View article]
All fine but the stock has run up way too high. I'm interested in shorting when the death cross occurs.
Overhauling the Numbers With AutoZone [View article]
They also seem to be able to maintain their (barely) investment grade bond rating to keep borrowing at low rates. I would love to see a surprise downgrade of their bond rating as this would pulverize the stock price instantly, but I think the board and CFO are too smart to let that happen.
Autozone’s Price-to-Sales Ratio May Dampen Future Performance [View article]
Great cash flow but the company is using more than free cash to fund the buybacks. LT balance sheet debt has been going up for the past few years. It's akin to a slow LBO. It's not to say it's a bad strategy if they think they can maintain the free cash and make all the interest payments and maintain their "investment grade" bond ratings (actually one notch above junk so it seems). In a few years when the float is very small, they might be able to do a killer short squeeze like that of Porsche/Volkswagen.
Seeking Yield in BDCs: Why We Chose MVC Over BlackRock Kelso [View article]
14 Undervalued Stocks Approaching 52-Week Highs [View article]