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  • Volkswagen AG: Expect A Dividend Cut, Dilution, And Lower Profits Going Forward [View article]
    dear Author, any thoughts on this ?

    if we skip the present negative momentum , mostly driven by sentiment and look at some ballpark numbers

    at the beginning of the year the stock quoted as high as 250 euro, it than moved in a solid downtrend as there was growing fear of slow down in the upcoming markets, especially China, that took the stock down to 135/150 euro level.

    ever since Diesel-Gate the stock took a beating moving down to the 90/100 euro region, so it dropped abt 40 bio in market cap , since the cheating became knowledge to share holders.

    Credit Suisse came with an update on VW and estimated that the cost could be 20/25 bio lower end and 70/80 bio upper end as a worse case scenario.
    I understand VW took a 6,5 bio provision on call-backs as for the engine fix-it cost and another 7 bio provision on ' what is to come ' ( first provision for claims, i assume)
    now one cannot exactly compare like to like, but say the 40 bio drop in market cap , number wise should at least provide for a somewhat mid-scenario.

    now in case we go to the worse case scenario, i take it VW has to be moved out of the holding, so at least the other brands are safe such as Porsche, Seat, Skoda, Audi , Man Trucks and the exclusive brands Bentley and Lamborghini, that does not mean that the holding will not be accountable for whatever the loss may end up being at VW, but at least they protect the brands.

    Now how realistic is worse case scenario, 15% and can the VW as a group survive ?

    I think they can, I think that if we translate the loss to market cap, VW may tumble to 75 euro, they may well have to sell the exclusive brands such as Bentley and Lamborgini, TATA from India may well be interested in a brand which would be above Jaguar and Range Rover, they have shown willingness to invest in selective brands.

    we may well conclude that Porsche which took as much  a beating as VW on the exchange may well be worth scale down dipping into, be it one has to take a 3 year horizon and it is a risky bet, but it may pay off handsomely

    Sentiment apart, the stock is already taking the equivalent of a 40 bio beating in it's share price, on an overshoot from here for risk takers it's worth to invest some money, imho, this thing ending near 25 bio as a total cost package, the stock will zoom back to 125 VW basis or 55 Porsche basis and that is not impossible ?
    Oct 3, 2015. 06:08 AM | 2 Likes Like |Link to Comment
  • Apple In The Enterprise: Investors Shouldn't Get Excited Yet [View article]
    sorry typo ... if Apple were ... instead of where
    Oct 2, 2015. 03:03 AM | 1 Like Like |Link to Comment
  • Apple In The Enterprise: Investors Shouldn't Get Excited Yet [View article]
    @ toneguru

    sorry for the somewhat late reply, i am in a different time zone

    you are correct, but that reads a bit like they would have to start trading their own stock and that cannot be the purpose of the Management, they are there to run the business , not the direction of the share price.
    their goal is to grow the company, maximize profits and look at the best possible way to reward share holders.
    2 out of 3 they outperform the world by far, the last one imho could be better.

    I believe Icahn has been an enormous support to Apple's stock, but he is a trader, so it's OK for Apple to hear him out, but now I have the feeling they are following his lead and ultimately Icahn's objective may well be very different than that of the regular shareholder, maybe he is better off with market share improvement than dividends.
    also remember if ever he wants to exit the stock with the amount he is holding, he needs Apple to buy their own stock to be able to get out.

    if Apple where to up the dividend to 4,5 % all Long Term investment Funds would pile in the stock for buy and hold, there is no other security on the exchange which is as safe as Apple, safer than the Bank of England or Government Bonds.
    the investment funds would take over the role of the buy backs, hence the dividend take the cash out of the company, the LT investment funds support the stock and the result is we have money in our pockets and the multiple improves by 5.

    anyway none of us are complaining, we are just debating whether we as share holders would be better served by higher dividends and less buy backs and as such our favorite stock for risk/reward gets a better multiple.

    and as far as financing the money, as Apple's main surplus cash is off-shore, it makes no difference whether you borrow to do buy backs or if you pay out dividends, in both cases the off-shore cash is the collateral.

    now i do appreciate that key Management are rewarded stock options which mature over time at certain strike prices and as such the higher the stock price the more rewarding the bonus, that's clear, but it should not be too difficult to change that into linking the bonus to the amount of profits Apple makes and give them the cash or allow those option shares from day one to collect dividends, even if the employee is not yet the owner, so he/she does not come short.
    I am all for rewarding the employees handsomely for their good work.
    Oct 2, 2015. 02:05 AM | 5 Likes Like |Link to Comment
  • Apple In The Enterprise: Investors Shouldn't Get Excited Yet [View article]

    yes, but sorry to say management is partly to blame, they are excellent people at running the business and excellent at selling their products, unchallenged for raking in profits, but they are poor money managers.
    Apple should have paid out large sums in dividend rather than do all these stock buy backs, they should have handed that surplus cash to the share holders, that would have lowered their market cap and the ridiculous low multiple which now stand at 9 X without the cash would have been at 15 X where it deserves to be. we would all have plenty of cash in our pockets , now they are spending a 100 bio on buy backs and the whole world is front loading on that to sell it into their buying, what a waste. 
    nevertheless here at 107 Apple is a steal and once we cleared that 115 barrier we should be back on our way to 125 where unfortunately one has to let the stock go again, because it will start all over again.
    Oct 1, 2015. 12:12 PM | 8 Likes Like |Link to Comment
  • Apple Sold 13 Million iPhones On Launch Weekend - That Should Frighten Investors [View article]

    the Author is short the name and has been from 450$ pre-split ( 65 $ present value), but as a sensible investor he is hedged by being Long BBRY at 15 $

    now in all fairness to him, he is short through being long puts on Apple and he has been Long BBRY by being long calls, so it's a kind of damage control that the losses are contained to wasted premium rather than getting killed on the stocks, but from a trading perspective these have been horrendous calls.
    Oct 1, 2015. 11:43 AM | 4 Likes Like |Link to Comment
  • Apple In The Enterprise: Investors Shouldn't Get Excited Yet [View article]

    oeps , the author is slightly changing his tune, must be the share price
    actually now is the time to buy Apple for the coming 3 to 6 months, once we cleared the 115, 125 should be possible.
    Oct 1, 2015. 11:26 AM | 7 Likes Like |Link to Comment
  • Apple Is Building Its Largest Startup Ever [View article]

    maybe it's major strategic player like Icahn hedging out through market makers , whilst position wise he is still perceived to be a committed Long
    overall Icahn is so unbelievably bearish on the market in general and someone is just keeping a lid on Apple , feels like there is a concrete roof above the stock between 110 and 115
    strange there is someone out there selling as much as Apple is now doing for fresh buy backs, that can only be a major Long hedging or many people are abandoning the stock, not even holding off for a rally, just letting go.
    Oct 1, 2015. 02:34 AM | 2 Likes Like |Link to Comment
  • Apple: Mapping-Focused Acquisitions, iBeacon And Kylie Jenner [View article]

    Hi Glen

    that's a very good question, I am afraid there is no yes or no answer, but more like what else can they do ? the car industry is about to get overhauled and High Tech is becoming increasingly important for the car industry

    Apple needs to find something which can give growth for the next 10 years , Highly Automated Driving and self driving will be an enormous growth market and that does not work without real time mapping, that's why the German car industry made that move for Here from Nokia.

    traditional car industries must be very worried about High Tech moving in, Tesla has shown the world how fast things can change and although still without profits, everybody fears the potential or wants in on the game.

    I believe Apple has to, but I agree with you GooGle is an amazing company, they are difficult to read, they are now also an investment vehicle , they give the impression to provide services for free, yet at the same time they take away your privacy, know exactly what you are doing and bombard you with advertising.

    Apple is a bit lost, the most successful company the world has ever known, seems to be now so dependent on those phones it's almost scary, however you can't blame them for milking it all the way.
    Sep 30, 2015. 09:53 AM | Likes Like |Link to Comment
  • Apple: Mapping-Focused Acquisitions, iBeacon And Kylie Jenner [View article]

    if Apple are serious about getting involved in self driving cars and we all assume they are and if they are upgrading their mapping

    why are they not making a move for TomTom's mapping unit, TT is very well established, they are ahead of the competition as far as real time maps are concerned, the stock is quoted on the Amsterdam stock exchange and they are not expensive, especially considering the German car makers bought Here from Nokia for slightly under 3 bio euro.
    Sep 30, 2015. 09:22 AM | Likes Like |Link to Comment
  • BlackBerry: Where Is The Bottom? [View article]
    unless he wants to go back to Bombay and leave his beloved Canada where he is apparently known as the Buffett from the North, i think he at least should have the decency to pay a reasonable premium over present shitty  price for this institute called BBRY, i remember him being quoted some years ago stating " BBRY's fair value is at least 40$ ", well if that's still valid, than at 9$ it's a mere snip for the old money manager.
    Sep 29, 2015. 01:48 PM | Likes Like |Link to Comment
  • Volkswagen AG: Expect A Dividend Cut, Dilution, And Lower Profits Going Forward [View article]
    thank you for yr interesting paper, I fear this is far from over for VW, they cheated customers, governments, share holders and competitors

    there will be court cases everywhere, I live in Belgium and the Minister here is looking at legal actions against VW as a polluter, Belgium has been fined several times because of exceeding limits on pollution and for a small country we have 0,5 mio of infected cars, where the software has been deliberately fixed to give wrong readings at control.
    also other car makers are complaining that VX cheated on them and that they have lost market opportunity with Potential customers.
    VW has been deliberately cheating for 7 years and in many of their models.

    it is impossible to put a number on this, VW may well be taken out of the holding as to save other brands such as Porsche, Bentley, Lamborgini, Audi and so on .. the fixed software was in engine EA 189 and that's a VW concept, they may try to ring fence it around this VW owned engine so all blame is on VW and not so much on Audi and Seat or Skoda where the same concept engine is to be found.
    this will become a legal play and VW may well end up being the dumping ground for the Group.

    I think it looks horrible, also people say German Politics won't let VW go down and save the company if need be, but this is different than BP, that was a catastrophe where gross negligence and bad actions are to blame, but VW cheated, which Government is going to back a multinational which deliberately was out to cheat.
    I do not believe this will take VW down, but i think for now it is a no-touch company, no matter how cheap the stock looks there is no saying what this will end up costing.
    you want to take advantage of this overkill on the stock , better buy Porsche they are separately quoted on the exchange, risky as they own 52% of VW, but possibly safer from a legal point of view and they also dropped 65% in value since the beginning of the year.
    Sep 29, 2015. 02:35 AM | 1 Like Like |Link to Comment
  • BlackBerry: Where Is The Bottom? [View article]
    the bottom is the moment that Prem has had enough and takes the stock off the exchange, but than you are too late
    the only thing one can go by is that just prior to Chen joining Prem wanted to take the stock private and was willing to pay 9$ a share, the conditions were not attractive enough as the company was still bleeding heavily, so Prem wanted all kind of guarantees and that did not fly.
    now the company is at least clean, there is no further hemorrhage , there is surplus cash, but there also is much uncertainty about BBRY's future, so now it's a numbers game to Prem and his mates, assuming he has to pay a reasonable solid premium over the share value, the 9 $ may well fly this time around, so if you buy in the low 6 , maybe even upper 5 there is possible 50% to be made, from the guy who is hurting most

    now if it does not happen what's the downside, as long as the cash is there not too much it may hit 5 , it will look very ugly , but there will be a bounce at some stage and you can always get out near break-even, so for a punt to me it's a buy scale down.

    other than that there is little to say abt BBRY, the news is forever the same, next quarter should be better, but it won't.
    Sep 29, 2015. 01:34 AM | 3 Likes Like |Link to Comment
  • BlackBerry confirms launch of Android-based phone, boosts buyback [View news story]
    I am no longer counting on Chen, his work is done, there is only so much one can do for a turnaround and that turnaround was mainly to stop the bleeding, now it's up to Prem to save his fund biz, not BBRY, his reputation as a fund Manager is so much entangled with BBRY, he must be suffering, what a horrible investment, he can but take it private, than he is away from Wall Street and away from the public eye, this is killing his fund Biz, BBRY is a huge investment to Fairfax and that's his biz, i cannot see any alternative but to take it away from the exchange, than he can also more easily play with the numbers , split the company, cash on the patents, plunder the cash and close the bad and sell the good, and he can only achieve this by owning the company in full, that will command a premium over today's value, I am scale down in from 6,50 down to 6,00 and will see how much gets filled.
    If Prem now takes it private at 9 , no one will object , that's 30% premium and at that price he has got a fair change for some damage control and he can play with the numbers and take the cash, that's now BBRY's only asset.
    what else can they do ? the biz is evaporating, they are not even a niche player, there is no niche for BBRY, it's done, it's fading away.
    anyway I am taking a punt on it.
    Sep 25, 2015. 01:32 PM | 4 Likes Like |Link to Comment
  • BlackBerry confirms launch of Android-based phone, boosts buyback [View news story]

    I have no idea what BBRY's future looks like, but if the stock slides below 6,50 , i will start buying it, because i do believe that future will no longer be as a public quoted company, they will look to delist and that should be good for 30% premium

    so let's hope Wall Street will sell the stock and take it down to 6

    9 $ is what Prem was trying to pull last time and now with the company at least cleaned and no longer bleeding and still cash rich , that should be his way out.

    50% to be made on a punt, i'll take the risk.
    Sep 25, 2015. 11:09 AM | 3 Likes Like |Link to Comment
  • Apple reportedly buys mapping visualization firm; S&P upgrades to Strong Buy [View news story]

    Apple as an enterprise is doing great, they are milking the Phones to the max and in the meantime use those earnings to diversify
    the problem is Apple today is very dependent on the Phones and the Chinese are catching up on quality, eventually they will narrow that gap and than it's down to price/quality and that's the problem, either the Chinese have to move up their prices or Apple has to come down or invent something else to keep those Phones selling

    as for the share price, i feel Apple trades in a range 105 - 125 and I don't see it breaking out of this range anytime soon, besides a short term overshoot, so buy scale down from 110 and sell scale up from 120, but trade the stock from the Long side, shorting Apple  is too late , with hindsight it was a fantastic sell at 135 and buy below a 100, but that's over, the markets as well as Apple had their correction.
    Sep 17, 2015. 02:14 AM | 6 Likes Like |Link to Comment