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  • Lowering Our Fair Value Estimate Of Procter & Gamble [View article]
    Really? One could have purchased PG for $60 several times during 2010-2012, at 15x earnings (I know because I did). Incidentally, earnings during that period were more than they are now. I still own some, but not much more than a placeholder until it is more sensibly valued.

    Hint: buy low sell high. If your philosophy is never sell, I don't know why you would be looking at Seeking Alpha in the first place.
    Mar 20, 2015. 06:51 PM | Likes Like |Link to Comment
  • Offshore Drillers Are Now At Risk From Contract Cancellations [View article]
    You're most welcome my friend. Some added thoughts:

    We saw most oil sector stocks bottom in the mid December to mid January time frame, and the price of WTI crude hit a low at the end of January and bounced ( Over the past few days that low was taken out but the oil sector stocks did not make new lows (for the most part). See (

    My conclusion is that a certain level is priced in and we really haven't hit it yet. The real question is what is that price? For my part I would not be surprised to see WTI with a price below $40 before it's all over. I would be a bit surprised if the bottom is already in since I haven't seen extremes of volume that usually happen around those price extremes.

    We're both early, but I'm not done buying or haven't yet bought NOV, HP, EMES, DNR, DMLP. My spec positions are set already and include mostly options on PWE, BXE and NADL and good sized bets on CPE (common and preferred) and PACD. Good luck to us.
    Mar 20, 2015. 04:30 PM | Likes Like |Link to Comment
  • Pacific Drilling Is Well-Positioned To Weather The Industry Downturn [View article]
    Bravo NQP.

    Eeulo, it sounds like you shouldn't buy PACD, and maybe even short it.

    I actually think that the chances are pretty good that PACD reaches a deal with Chevron for Meltem (at least) which may involve reduced dayrates for Santa Ana and/or Sharav. Just a hunch, but I like potential win/win stuff like that.
    Mar 20, 2015. 12:17 PM | 3 Likes Like |Link to Comment
  • Spectra Energy: A Solid Dividend Growth Candidate [View article]
    Re: DCP Midstream - partner PSX has made noises about wishing to inject capital, which SE has declined to entertain. There is a possibility that they might want to buy out SE's interest, since DCP assets can provide cost advantaged feed to PSX refineries.

    Also, given the long haul transport from Marcellus/Utica to GoM, it's entirely possible that this will be a better capital appreciation play than income holding. The dividend doesn't hurt, but I discount it over a five year period where rising rates are expected.
    Mar 19, 2015. 09:22 PM | Likes Like |Link to Comment
  • Lowering Our Fair Value Estimate Of Procter & Gamble [View article]
    I'm a buyer below $60 (below 18x earnings). At $60, it's not that great a bargain.
    Mar 19, 2015. 08:29 PM | 1 Like Like |Link to Comment
  • To Make The Costco Pain Go Away, American Express Goes After Capitol One [View article]
    Not to mention incomparable ROA and ROE. But probably the biggest difference is the customer profile (Viking hats wouldn't work to attract them). That is what has had enduring value despite competitive pressures.
    Mar 19, 2015. 08:25 PM | Likes Like |Link to Comment
  • Should Dividend Growth Investors Fear Interest Rate Volatility? [View article]
    Actually, I question the use of the term. Why would it be irrational to re-price a 4.5% yield if the risk free rate were (to pick an exaggerated number) 10%? Surely that is the opposite of irrational. Maybe you think it's irrational because it is only the likelihood of it happening that changed? Is it irrational to believe interest rates will rise? Is an expected time frame for a rate increase rational or irrational?

    On the other hand, is your expectation of growth prospects rational or irrational? If O were currently priced at $75, would buying it be rational? What about at $15? I think it is at least unwise and complacent (I won't say irrational) to dismiss the messages that stock prices can send, however noisy they are.

    Please, someone chime in and tell me it depends on what your investment goals are....
    Mar 19, 2015. 08:04 PM | Likes Like |Link to Comment
  • Kinder Morgan: A $6.4 Billion Backlog Growth Opportunity Nears Fruition [View article]
    Non-issue until it isn't. Complacency is ill advised in inverse proportion to risk.
    Mar 19, 2015. 06:54 PM | Likes Like |Link to Comment
  • Potash -4% on Saskatchewan tax changes, soft China-Belarus deal [View news story]
    SQM is listed in the related tickers, but the effect of POT 30%+ ownership in the company isn't. Whoops.
    Mar 19, 2015. 06:50 PM | Likes Like |Link to Comment
  • Pacific Drilling Is Well-Positioned To Weather The Industry Downturn [View article]
    Thanks for he article PH.

    43231, I avoid TA terms like that. After all, one side's accumulation is the other's distribution. What I see is that PACD share price seems to have been pretty resilient even on ugly days for the rest of the sector.
    Mar 19, 2015. 06:26 PM | 1 Like Like |Link to Comment
  • Offshore Drillers Are Now At Risk From Contract Cancellations [View article]
    Sure, I think a price recovery at least into the $70s within 12 months is extremely likely (is that rapid?). BUT, there are a bunch of companies that are insolvent in the meantime if lenders don't play along. A bunch more are insolvent at $70 oil (the more marginal tight oil E&Ps). I see June as the earliest we'll be able to see supply/demand balance. It's a pretty risky sector right now.
    Mar 19, 2015. 05:15 PM | Likes Like |Link to Comment
  • DGI Investing: It's Riskier Than You Probably Think [View article]
    "Do you think Mr. Buffett sits in his Omaha office worrying about the stock prices of the equity portion of his portfolio?"

    conkjc, why do you think he sold out of Exxon? Why did he consider not selling KO (in 2000) a huge mistake? Do you think that he considered a duration less than eternity?

    The questions are rhetorical. I'm unchecking the article follow box because I consider the claim that anyone pays no attention to stock price to be disingenuous or worse - in any event not amenable to profitable discussion. If nothing else, stock price is a strong signal about company prospects.
    Mar 19, 2015. 05:00 PM | 1 Like Like |Link to Comment
  • Bakken Data Plus The EIA Versus The EIA [View article]
    BTW, hiberty, Berman has some interesting talks out there. While it's true he sees a potential for price recovery into the $70s by year end, he also sees some unknown number of shale E&Ps in BK. I don't agree or disagree with this - just that it's not necessarily a rosy picture even if accurate.

    He also thinks that Exxon is actually in liquidation mode.
    Mar 19, 2015. 04:53 PM | Likes Like |Link to Comment
  • Kinder Morgan: A $6.4 Billion Backlog Growth Opportunity Nears Fruition [View article]
    Thanks for the article. I think some mention of competition would be warranted. Investors looking at companies who bring supply to markets northeast from the Marcellus and Utica and long haul south to the GoM include WMB, SE, and probably the NI gas spinco (scheduled for later this year). Are there others?

    I think WMB and SE are better bargains right now than KMI or NI (which is hard to value absent a real pro forma).
    Mar 19, 2015. 01:17 AM | 3 Likes Like |Link to Comment
  • Offshore Drillers Are Now At Risk From Contract Cancellations [View article]
    They can't reject (i.e. keep working and somehow force payment). They would sue and win any stipulated payment. The risk would be counterparty ability to pay, since the contract will almost certainly provide termination payment requirements.

    While it mostly addresses onshore data, if you look at the HP 3/12/15 update here (, slide 5 shows early terminations, and a footnote to slide 25 shows compensation for terminations received to date. Standard procedure in these contracts.
    Mar 18, 2015. 06:19 PM | Likes Like |Link to Comment