jwaydog

Harley-Davidson in the Mire and Likely to Stay There

Wow! Just plowed through all the comments. Great job David and Punter! GS went neutral at a significantly lower price than hog currently trades.
Later,
Jwaydog

Harley-Davidson in the Mire and Likely to Stay There

David,
Great article...couldn't have written it better myself. I started getting short hog the day before 2nd quarter earnings and have been adding to this position since (even bought some $20 january 2011 puts) though so far this is not working . Please allow me a few points:
1) The story can easily be shortened to this: hog most likely isn't going to make it. Why? Jobs, jobs,jobs! I always hear people talk about doctors and lawyers who ride harleys. While it is true some do ride (actually not that many doctors would ever ride), an overwhelming majority of owners are pure blue collar. Working people love their harleys but they also love their homes and eating. Hog cannot survive in an 10% unemployment economy.
2) How Harley gained market share is beyond me. Perhaps it is a testament to the amazing brand panache or maybe the numbers are just wrong. New heavyweight metric bikes are selling with huge factory incentives. Are we to say that Harley does not compete against a very interesting lineup of their own clones. I think not. Hog faces a colossal delimma: how to discount and actually sell bikes without damaging the brand (most people are willing to pay more for a Harley because they believe value will be better retained) and further eroding the value of HDFS's portfolio.
Said it a thousand times "love the bikes, hate the company".
Later,
jwaydog
Word to the wise: just remove the gas guzzler comment. Harleys get outstanding mileage by any measure. I have owned them all.

Selling Premium on the Uncertainty in Oil

Love it! Love it! Love it! Yes, I should get out more but it is not as much fun as reading articles such as this. Very niiiice!

Tesoro: An Aggressive Way to Play a Short Term Oil Pullback

Everyone keeps wishfully hoping that decreasing oil prices will fix profitability issues for the likes of TSO. Most likely a short term pullback in oil means $115 to $125 per barrel. When you consider the relative weakness of gasoline demand, the crack spread is still not that great. One must factor in the increase in operating costs for the refineries in 2008 (which negates a couple of dollars of improved crack spread). Furthermore, TSO has yet to earn a profit on their forays into the retail segment. Debt to equity ratio of .702 in a low margin business with rising input and operating costs and waning demand for the finished product do not indicate a buy. As if this was not enough, we are entering hurricane season (just a hint of a big storm will send oil prices spewing higher). TSO's best hope is a takeover. Tuesday I bought July 22.50 puts on TSO for a song. So far so good.

The Relationship between Oil, Drillers and Refiners

With regard to the refiners, we know the crack spread has not been favorable. Additionally (however often overlooked) the operating cost per barrel has risen significantly. For example Valero's 1st quarter operating cost per barrel was $4.69 as compared to $3.93 for year 2007 and $3.53 for 2006. I want to own the refiners but cannot bring myself to reenter.

The Relationship between Oil, Drillers and Refiners

It seems to me that conversely drillers are much,much more sensitive to a decline in oil than refiners. At this point the research on a decline may be in order. I have owned OIH for a long time but am out now due to this belief (though I like the drillers long term) just not at this level. Lost my a-- this year on the refiners waiting for the dollar to strengthen and oil to wane. Now I would like to get back into vlo,tso but am worried about gasoline demand. Ok, it feels better to talk about it.

The Relationship between Oil, Drillers and Refiners

Actually, the summary that oil drillers greater upside relative to the price of oil vs refiners downside is very interesting and therefore I retract my previous statement. Nice work.

The Relationship between Oil, Drillers and Refiners

duh

Chantix Side-Effects May Halt Rare Pfizer Success Story

Let's face it....smoking kills people. Therefore, if you are taking this drug you were already crazy for being a smoker.
It is amazing that people are trashing a drug which has been extremely effective at weaning smokers. By the way, have I mentioned that SMOKING WILL KILL YOU. Bad dreams, odd behavior, so what!