user1010101's Comments

Will Synopsys Rise from the Dead?

Mon, 21 Dec 2009 08:55:02 -0500

SNPS is extreemly cheap. The company has a $3B market cap and $2B enterprise value - meaning that they have $1B in cash!

You need to adjust all your valuation multiples up there (reduce them by 1/3). This stock is crazy cheap for a company with 90% recurring revenue, industry leadership and continued market share gaining position over competitors CDNS and MENT.

This stock represents the ultimate in value investing!

Industry Ranks, Two Looks

Mon, 14 Dec 2009 08:16:34 -0500

not quite sure how much value you can get out of this?

Why I'm Bullish on GameStop

Mon, 30 Nov 2009 12:11:12 -0500

also, your math does not make sense - the person who traded in the game did not add margin.....

Why I'm Bullish on GameStop

Mon, 30 Nov 2009 12:10:34 -0500

Troilus - you are relying on used game sales to continue.

How can you say that this will occur if everyone in the industry believes online distribution is the way to go.

Why I'm Bullish on GameStop

Mon, 23 Nov 2009 09:06:30 -0500

I have two issues with this company: 1) is there a terminal value - i.e. will online distribution slowly steal revenues from the retail outlets and 2) the accounting applied to new vs used game sales.

I don't believe I need to elaborate on the first issue - it has been well discussed and blogged about on seekingalpha.

I do however think there are some issues with the accounting at GME - specifically with regards to gross margins. The company seperates both new and used game gross margins but does not explain how they value used game inventory (other than they have a "proprietary system") or how they account for trade-in's.

For example, if I walk into game stop and trade in a used game (say I get $10) and then go buy a new game (costs $50) I pay a net $40. Assuming game stop gets a 20% margin on the $50 price point, they would net $0 - i.e. no margin ((50*.2) -10 = 0). However, as it currently stands, i believe the company records the used game margin independent of the trade in that occured in the transaction. Instead, the company includes that $10 trade in as an inventory purchase (i.e. dr. inventory cr. cash).

I am concerned that this company is buying its sales and may have a large build up of used inventory. The company refuses to offer up the value of its used inventory - almost every year we have seen inventory levels rise (recently faster than sales). I think this is cause for concern and investors should be cautious on the name.

STEC Revisited: Will It Go from Good to Great?

Tue, 17 Nov 2009 09:03:23 -0500

Sorry GARP - but you have last too much credibility. Anything you say now just sounds like made up stories (i.e. your belief that EMC is pushing SSD's by offering incentives). I think you need to step back and recognized everything you initially thought was incorrect - it is clear SSD adoption is not taking place as rapidly as you thought. HDD storage is cheap and short stroking drives to increase performance is understood by IT departments. It will take time before comapnies decide to switch over to a new device - prices in $/Gb will need to come down in order to convince people.

I am glad you have suggestions for the company but you should have presented all of these risks in your initial reports. Clearly, there were conflicts of interest on the board and management was weak.

You became too attached to STEC and didn't think objectively.

STEC's Promising Future – Part II

Tue, 03 Nov 2009 17:07:17 -0500

I guess we all now know where GARP was getting his borrow from.

Apples to Apples: Will History Repeat Itself as Android Gains on the iPhone?

Tue, 03 Nov 2009 09:45:18 -0500

Bruce,

Nothing more to say other than that this was an excellent post. I love it when people provide the historical perspective!

The commentators above me are clearly consumers of the Apple fad - which shows you how powerful this companies marketing machine has become. Regardless of what happens to Apple, increased competition in this industry will only create better mobile devices for all of us!

On EESAT and Energy Storage Opportunities on the Smart Grid

Tue, 27 Oct 2009 08:31:41 -0400

hey John, was anyone at this conference from EEstor or Zenn Motoros?

Where Is the Gaming Industry Headed?

Wed, 21 Oct 2009 09:37:37 -0400

Eskin,

I agre with you completely. The move to an online distribution platform is still years away for a variety of reasons:

1) carrier networks are already over loaded with data demand coming from smart phones - there is no way they are capable of handling HD game streaming
2) consumer preferences have not changed in such a way that they want to buy/rent a game online. Many games have reply value or, at the very least, resale value.
3) game publishers are not going to turn down a free opportunity to distribute their content but none of them have commited to supporting platforms (like onlive) financially

Online gaming has been around for a long time - mmorpg's have been very popular for years. The fact that we have just seen 1 generation of online gaming (xbox and ps3) shows you how slow the industry is moving.

On Oct 20 10:13 PM Eskin wrote:

> Wow! VERY Cool article. I wonder how accurate that Apple daily revenue
> potential is because seems like a major cash cow right now... esPECIALLY
> as Apple gets deeper and deeper into the remote gaming market.

>
> Also, as a gamer during my entire life, I would find it VERY surprising
> if the OnLive idea actually succeeded. I'm an avid believer that
> the future generation of gaming is online with other players (much
> related to social media today, and is already here with XBox Live),
> but serious gamers really don't care about having, as you mentioned,
> "real estate" in their living room. If the system is worth it, like
> Ps3 or whatever comes out next, the graphics and speed will justify
> having the tower in their living room. Who cares that it's there?
> A majority of controllers nowadays are wireless anyway. The extent
> of problems (slow, huge controller, always need to be online) with
> an always on-line system will definitely not be worth it compared
> to the benefits (just not having the system there).
>
> Check out my blog at www.youngandinvested.com

GameStop Director Leonard Riggio Shows Us the Future of Gaming

Fri, 16 Oct 2009 11:51:00 -0400

Gaucho420,

I am not sure I agree with you that hardcore gamers download games at mid-night since not all games hit XBL before being released at a retail level - this is up to the distributor. As well, with the size of games getting larger, a 60gb HD is worthless. You cannot simply d/l an unlimited amount of games - at some point you run out of space. The idea behind the HDD was not to convert customers to an online distribution model - it is meant for updates, upgrades and game packs.

Finally, if everyone were to jump on to d/l a game (like you do) you would not have the game d/l by the following morning - servers are not capable of handling those loads. So, for now, be happy your are one of the few taking advantage of online distribution.

On Oct 15 04:41 PM Gaucho420 wrote:

> Dedicated gamers will get their games faster by downloading. I have
> XBL and if a game came out at midnight online, I'd have XBL downloaded
> overnight and have it ready for use in the morning. That's much faster
> than waiting for a retail store to open the next day.
>
> I go to store now, such as this week to pick up NBA2k10, because
> I wanted the anniversay edition. But had it been a normal non-anniversary
> year and had the option been there to download it straight to the
> hard-drive from XBL, I probably would've opted for that.
>
> I think a bigger argument agaisnt downloads is 1) the added cost
> of a hard drive to store them (especially when you get to the full
> sized games), 2) the lack of a manual and 3) no trade in value on
> downloads.
>
> I know quite a few dedicated gamers who don't download that many
> games, because they dont' feel like wasting money on a hard-drive.
> And that's the over-riding reason, plus the trade-in value of discs.
>
>
> For the 360, retailers should thank MSFT for making the hard drives
> propriatery and super expensive, as it keeps a large number of gamers
> hooked to retailers, as nobody wants to pay MSFT ridiculous price
> on its 60 gig or 120 gig drives.
>
> I have paid for the 120 gig drive, because I can afford it, but most
> can and most simply don't even trie demos, movies or anything else,
> as the hard-drive on the 360 is cost-prohibitive.
>
> I know the PS3 can use any drive you choose, but even at bottom barrell
> prices, it still cost money.
>
> So in my humble opinion, online gaming will be restricted (for a
> tiny while) by the cost of extra storage. I have seen this to be
> true across my gaming friends and I know a boatload of all ages,
> sex and income types. Gamers want to play...paying for a hard-drive
> is simply an unwanted hassle at the current prices.

GameStop Director Leonard Riggio Shows Us the Future of Gaming

Thu, 15 Oct 2009 08:33:09 -0400

Bruce,

Could you please provide an outlook for the video game industry over the next year?

Although I agree with your general coments regarding "long term" industry direction, I think that your arguements have little application in the short term. Products such as the PSP GO have not been given raving reviews specifically because it is an all digital product (gamers can't easily move there existing games over).

Also, I don't beleive the nintendo would support (and infact resist) moving to a fully online distribution platform. Children still like going to the store and purchasing games. Similarly, "gamers" prefer to purchase the game as soon as it hits the shelf - who wants to wait for delivery. Gamestop allows preordering which targets a particular customer that will likley never move online for distribution.

I would find it very usefull to hear your critisism - since I am bullish on gamestop due to valuation as well as environment. Many major titles are coming out, gamestop is running at depressed sales/sq. ft. and continues to expand their store base. At 9x earnings, >10% FCF yeild - i believe this thing could be a home run.

Thanks

Ryan

Promising Future for STEC

Sat, 10 Oct 2009 11:52:12 -0400

Ickabod,

Sorry to burst your "bear" bubble but I am afraid you are the one who made the mistake.

1. Go to EMC's web site and browse around - you will find a large slide show that explains the benifits of using STEC's drive

2. Go to IBM's website and you will see that they now have the highest performance arrays in the industry (due to STEC drives) and it only accounts for 8% of system costs.

3. You compare regular SSD's to enterprise class SSD's! It would be the same mistake if you compared a regular HDD to enterprise class HDD. Of course the numbers don't add up if you are comparing the wrong things!

4. If it makes so little sense to use SSD technology, where are all companies introducing some type of SSD drive in 2010 that is enterprise class.

5. Do some research on virtualization, bandwidth traffic, telecom backhaul problems etc and you will see that SSD being used in Tier0 of the storage array will become an essential technology.

6. Don't refer to data the is over 1 year old when even STEC's SSD's just recently were qualified with EMC - your data is irrelevant.

Promising Future for STEC

Thu, 08 Oct 2009 16:06:18 -0400

Could you actually provide some links to confirm your comments - where did STEC lose to Intel???

Promising Future for STEC

Thu, 08 Oct 2009 10:26:36 -0400

Do you happen to have any expectations are assumptions regarding margin stability?

Promising Future for STEC

Thu, 08 Oct 2009 08:26:36 -0400

another great article GARP

Dispelling the Samsung NAND worry - Reiterate BUY on STEC

Tue, 06 Oct 2009 16:09:16 -0400

GARP, I completely agree with you and I have done my own work and modeling on the company.

I was curious as to your back ground and how you have such insight into this company/market.

Thanks

-Ryan

New Flyer Industries: Liquidity Issues Not Expected but Possible

Mon, 05 Oct 2009 08:47:37 -0400

there is no corporate restructure..... What are you talking about?

On the Future of Networks and Moving Data Centers

Wed, 30 Sep 2009 13:02:13 -0400

By the way Mark - Your datacenterpulse website is great - love the information you make available here. Thankyou for opening that up to those interested in learning/keep up to date with data center technology!

On the Future of Networks and Moving Data Centers

Wed, 30 Sep 2009 12:48:52 -0400

Thanks Mark, that was helpful.

My understanding of the SSD argument is that $/IOPS is very favorable and the in Tier0 of the array, this is more important than $/Gb. I agree with you that you wont see SSD technology replacing SATA drivers in the 3rd Teir of a storage array but I do believe areas that require high IOPS will need to move to SSD technology.
My logic is that you can't simply run RAID 0 devices and short stroke 15,000 rmp drives any longer. This technology simply doesn't keep up with demand. Given that an SSD can replace multiple HDD's in this part of the array, I believe that we will see further enhancements to EMC's "FAST" (fully automated storage tiering) software.

The drives that are used in these arrays are not your typical MLC NAND memory but instead the SLC (more expensive) NAND. I know intel and I believe micron are close to coming out with a SSD that is 3bits per cell (MLC is 2 bits and SLC is 1) that will drive down cost even further.

Ryan

On Sep 29 08:12 PM mthiele wrote:

> Ryan,
>
> You're absolutely correct, it was a generic answer and don't worry
> you're not rude.
>
> So, I'll attempt to take up the challenge and offer something meaningful.
>
>
> As much as I like SSD there are several things that will keep it
> out of mainstream for the next 3-5 years.
> - Price per GB (while they don't have to be as cheap as regular disk
> they have to be a lot closer. Currently they are about 4X.
> - SSDs tend to deteriorate and lose cells, like other flash media.
> So for traditional environments this would be an unacceptable overhead.
>
> - Best option is for high volume environments where maintaining the
> data isn't the issue, but rather speed is the benefit.
> - I believe that SSD has a place in most storage environments, but
> you should be careful about defining the hierarchy.
> - Lastly, I hope they continue to make progress on MTBF and on price,
> because I really like the potential for power savings. However, right
> now power savings won't be the driver for a purchase.
>
> Regards,
> Mark

On the Future of Networks and Moving Data Centers

Tue, 29 Sep 2009 15:56:11 -0400

Not to be rude to Mark, but that was a very generic response that many are claiming. The SSD technology is already being used in the first Teir IBM and EMC storage arrays. I was curious if people are actually seeing the performance that is expected out of these devices and if the extra $$$ are worth it.

Do you know anyone that what have direct insight into the use of SSD technology in 2009/2010 storage arrays?

Thanks for the fast response!

On Sep 29 03:03 PM Gregory Ness wrote:

> User:
>
> Thanks for the question. I didn't know the answer so I forwarded
> it to Mark Thiele wo did. Here is his answer:
>
> "If we look at available disk technology today we'll see that spinning
> disk is reaching a plateau of capability. Size is great, but performance
> can't keep up. The impact of this trend in disk is that we will have
> enormous capacity, but potentially reduced performance with higher
> overhead. While in the SSD market the technology is still fairly
> new, and we can expect to see continued rapid improvements in size,
> performance and cost. I believe we can expect to see the application
> of Moore's Law to this new branch of technology in the storage family
> of products. Lastly SSD is generally more efficient from a power
> perspective, so we can expect to see a strong drive in this direction
> going forward."
>
> Thanks!
> Greg

On the Future of Networks and Moving Data Centers

Tue, 29 Sep 2009 13:24:26 -0400

Greg:

I was curious if you had any insight into the use of SSD's in the data center - your insight into their application.

Thanks,

Ryan

STEC's LSI Design Win Confirms Momentum: More Upside to Go

Tue, 29 Sep 2009 10:46:14 -0400

could I please get a copy of your model - I am curious what your model assumptions are:

-specifically, how many units do you think they will ship to EMC
-what margins are you assuming given they are running at 50% utilization in asia (I think that 30% op margins are sustainable for maximum 3 quarters).

Great set of articles on this name. Would love to chat more!

Deckers: Will Ugg Sales Be Up for Christmas?

Sat, 26 Sep 2009 13:44:23 -0400

I know that DECK is trading at a discount - I was simply stating that it was justified.

You obviously don't need to be told this but there is always a chance that those comps are overvalued. I look at the comps you provided and can further justify the discount:
(1) DECK doesn't really have a strong brand year round (mostly in the winter) compared to the comps you provided
(2) DECK is more exposed to the "fad" arguement than Nike, Skechers etc
(3) It other businesses (not UGG) have not done that well and were losing money for a long time. The amount of money put in to revive those other segments has not generated a very good return.

Deckers: Will Ugg Sales Be Up for Christmas?

Fri, 25 Sep 2009 14:47:27 -0400

Jeff, I think you have done a great job pationately outlining your analysis. However, there is no reason to believe that DECK should trade at a premium to any other retail company. I would agrue that the discount is fair given that it relies on 1 brand with little safety net from Teva.

Regardless, very compelling arguements - i hope you keep posting!

Notes from Magma Design's 2009 Shareholder Meeting

Wed, 23 Sep 2009 08:34:44 -0400

great post - its always good when someone reports from being on the ground

Busting Yet Another Market Indicator Myth

Mon, 21 Sep 2009 08:15:15 -0400

If you are a chartist - maybe you can make these conclusions. A fundementalist does not believe in technical indicators as the primary market driver.

On Sep 21 06:33 AM aarc wrote:

> In late November 2008 bottom, SnP was more than 40% below the 200-dayMA.
> In early March 2009, it was 37% below. There was a bullish divergence
> in both 200-dayMA %differential and the other usual TA indicators
> such as the weekly fast MACD and 14week RSI that led to this rally.
>
>
> Most of the time, an action begets an approximately equal opposite
> reaction in stocks and indeces.
>
> But based on the still anemic rally we had since March 9 as compared
> to the scorching selloff from September 2008 to March 2009; I am
> not expecting an equal reaction to the upside in the next 3+ months
> assuming this rally is sustained for the rest of the year. That means
> the 18 months of meltdown from Oct 2007 to March 2009 will not be
> met with an equal 18 months meltup rally toward the Oct 2007 high
> of 1576.
>
> This expectation is based on 22 weeks of downside price action since
> Sept 2008 1058 level to 667 bottom vs. 28 weeks of upside price action
> since March 2009 to current level of 1058 - the rally off the 667
> bottom is too slow as compared to the selloff from 1058 to 667 as
> measured in time.
>
> Most people use their accustomed perceptions of price and time rather
> than the hard data which is indellibly written on the daily, weekly,
> and monthly charts.
>
> The 21% rally off the daily 200MA is still not commensurate with
> the last run down toward 667 of 37% and 40% differentials.
>
> Assuming SnP can rally with 30% to 32% differential opposite reaction;
> then SnP can go toward 1200 area by the end of the year just by making
> quick and dirty estimates on the daily chart. More accurate projections
> can be done using differential calculus since the daily 200ma wil
> keep rising in a gradual slope as the rally continues with minor
> corrections along the way.
>
> Using the most optimistic price projection for this rally with Elliott
> Waves Analysis; the rally can possibly reach 1250 before it will
> require a massive pullback that can last 8 to 18 months. The weekly
> 200MA is sitting right into the 1250 area. Possible scenario but
> low probability since I've seen only few cases of such type of run
> with this type of price structure on the weekly chart.
>
> Higher probability for the bulls is a run toward 1221 tops using
> normal price projection method on the current SnP price structure
> on the weekly chart.
>
> Ideally, for the daily chart; a rally toward 1080 to 1100 this coming
> week will be needed in order to provide enought momentum and EW price
> structure that can sustain further rallies; 3 to 5 weeks of correction
> or consolidation will be needed after that rally toward 1080+ in
> order to sustain further rallies on the weekly chart.
>
> Then after that 3-5 weeks correction; another rally toward 1111 to
> 1131 by late November to December will be needed in order for the
> weekly chart to gain additional momentum and complete the 3rd wave.
> The price structure with 1111 to 1131 target is also a potential
> ABC corrective pattern on the weekly chart that the bears can use
> to short the markets.
>
> After the 3rd wave rally; a 4th wave correction will be needed that
> can last 2 to 4 months before the 5th and final rally toward 1150
> to 1221 can follow using the daily and weekly charts price projection
> method of conventional Elliott Waves Analysis.
>
> That is the conservative estimate for the a bull case rally off March
> 2009 without suffering a mini-bear market or a mini-recession.

>
> For the bears; there are no price projections at this stage since
> they have not done any sustainable selloff since March 2009. A wild
> guess using the monthly chart is possible but that will remain a
> wild guess until such time that a significant selloff had actually
> happened in the daily and weekly charts.
>
> Continuing on the bullish case:
>
> After 1150 to 1221 for SnP target range; a prolonged correction or
> consolidation will be needed on the monthly chart to sustain further
> rallies needed and fully recover the last high of SnP 1576.
>
> This major correction can start mid 2010 and possibly last 8 to 18
> months and may result in a mini-bear market or a garden variety recession.
> A mini-bear market by late next year or even the entire 2011 will
> be a very welcome sign that the markets had entered it's normal garden
> variety recessions most seasoned traders and investors had experienced
> in the past as opposed the gut wrenching meltdown of Oct 2007 to
> March 2009.
>
> Full recovery of the 1576 level for SPX is expected to be in the
> years 2013 to 2014 preferably no later than September of 2013 using
> the monthly chart projecting from the start of this secular bear
> market in the year 2000 before the dot.com bust.
>
> Both daily and weekly charts can support that target timeframe for
> the monthly chart with their most current price and time structures.
> But they are still very young in terms of growth off March 2009 and
> are still very susceptible to sudden unpredictable stumbles.
>
> For now, the strong rally last Wednesday enabled the daily chart
> ADX indicator to become trending again for the second time since
> March 9. Momentum indicators such as the fast MACD, the 14-day RSI,
> and the 14-day Stochastics were able to print new momentum highs.
> It means that more than 80% probability a pullback will be a buy
> for most traders using TA on the daily chart.
>
> The weekly ADX is still not bullish nor bearish but can support either
> a rally or a meltdown while the fast MACD, the 14-week RSI, and the
> 14-week stochastics are already in their bullish territories and
> are gliding above their 60% readings. There is no divergence short
> signal except for the weekly fast MACD but since the daily is still
> trending, the weekly MACD divergence short signal can still be "massaged"
> into a new momentum high that can fuel further rallies. For now the
> 14-week RSI is definitely in a momentum run to the upside and will
> require higher highs before it can be shorted using the divergence
> method. While the 14-week Stochastic is already gliding above the
> 80% range and can still provide several higher lows and higher high
> runs on any break below that level that does not go below 40%.

>
> Only the monthly chart is still trending to the downside but the
> fast MACD momentum indicator is now approaching potential new high
> that can blunt or mitigate the bearish ADX reading. It is very encouraging
> to see the fast MACD vigorously following the price runs in this
> case for SPX.
>
> Major resistance using the monthly 20ema and the fibo confluence
> levels using the weekly chart was the 1053 level. Last week's lack
> of trepidation among bulls in mounting this massively strong resistance
> is very encouraging from the technical point of view. If 1053 is
> successfuly mounted toward at least 1080 but preferably above 1110;
> then the next major resistance is the 1145 area using the monthly
> chart or the target run toward 1111 to 1131 range.
>
> There are still a lot more work to do for the weekly chart to start
> trending and start approaching their over-bought readings before
> they can start blunting the over-sold and bearishly strong monthly
> ADX reading. A very strong over-bought reading for the weekly chart
> is needed to finally reverse a strongly bearish and trending over-sold
> condition on the monthly chart. Tit for Tat. We need a trend on the
> weekly chart before we can achieved a trend reversal on the monthly
> chart and possibly start creating an upside trend for the monthly
> chart.
>
> A fresh over-bought condition off the bottom for the weekly chart
> will create a new trend. While a prolonged over-bought or over-sold
> condition can result in a major pullback or a reversal of the trend.
> The monthly chart is already in a prolonged over-sold condition after
> an 18 month of sustained selloff and is susceptible for a major pullback
> or a reversal.
>
> The monthly chart can take several years before it can start trending
> UP again if the bulls can reverse it's downward trend using the daily
> and weekly charts within this year.
>
> But at least, last week's Wednesday's price action suddenly reversed
> both intraday, daily and weekly bearish readings and price patterns.
>
>
> I was gearing up to shorting ES contract with a short-term intraday
> weak rally toward SPX 1053 resistance for several months protective
> hold of my stocks/etfs I bought last Feb/March; when all divergence
> sell signals were reversed by a strong rally last Wednesday on intraday
> and daily charts. Suddenly the bear rally since March has turned
> into a potential bull run in just 1 day of price action.
>
> A very positive development that bodes well for the bulls as long
> as we make a minor 1 or 3 days rally this coming week toward 1080+
> before we go into a 3 to 5 weeks pullback or consolidation range.
> Hopefully, the pullback stays well above 1018 high of July to early
> August rally and not go below that important high.

Busting Yet Another Market Indicator Myth

Sun, 20 Sep 2009 22:26:47 -0400

great article! A few questions:

(1) how did you select your two time periods
(2) if you were to follow fund flows from 1950 to today, how would you have done?

Thanks!

Regency Centers Would Be Lucky Just to Maintain Present Levels

Mon, 14 Sep 2009 08:48:37 -0400

You are leaving out JV share of NOI. Your forecasted EBITDA is $20M different than RBC's but you have a price target of half of his using the same cap rate.

Regency Centers Would Be Lucky Just to Maintain Present Levels

Sun, 13 Sep 2009 18:24:40 -0400

you didn't account for any of the JV share and other NOI items. You need to be careful here - don't assume that your $20M difference could decreases market cap by 70%.