Why I Had To Get Short Lululemon Today [View article]
The one who fails critical reading skills here is you. Bret's article is dated September 27, 2012. On that date LULU was already trading above $72. Between the date of his article and the date of his comment above the stock did go down more than 15%.
If you look at the sector in which LULU resides, that sector - like about 85% of all market sectors - was up strongly in the same period.
You reference the Dow. Symbol $INDU on Sept 27, 2012 was around 13.5K yes. And the value on the date of Bret's comment above Mar 20, 2013 was around 14.5K.
You aren't doing even the most basic homework. Why even post.
ServiceNow: Beating Revenues By $4m Does Not Negate Overvaluation Concerns [View article]
You have a strong point that they are near saturation of the market opportunity and growth will flatten quickly. The key is to know when is the quarter that sales growth slowdown will show up in reported numbers. If you could time that it would be a strong short.
Why I Had To Get Short Lululemon Today [View article]
In what parallel universe has the market gone down a) at all and b) more than LULU since his call in September? Your statement is flat wrong. Do a sector by sector analysis and they are nearly all up, except for commodities.
Specific to apparels, look at the sector symbol $GSPLP. But that ascending market is typical of what you will see in about 85% of the market sectors now.
ServiceNow: Beating Revenues By $4m Does Not Negate Overvaluation Concerns [View article]
Do you have a guess about when sales growth might slow for NOW?
The market tends to give very irrational valuations to any stock that grows its top line, seemingly giving a pass on earnings or cash flow. Look at CRM, N, or AMZN, all stories that continue to assign completely insane 1990s style valuations based on unprofitable top line growth.
What J.C. Penney Sellers Are Missing [View article]
ConservativeOutperformer, you don't believe the Net Tangible Assets number on the balance sheet? What about all of the real estate they own, which is probably on the books at much lower than current market values?
J.C. Penney Brings Back Discounting; Was The Fourth Quarter Horrible? [View article]
Do you have an estimate for what JCP might sell for in liquidation? I'm wondering how much of that net tangible asset number on the balance sheet is real. This might be a tough question since it involves properly valuing old real estate. But my guess is that the liquidation values of the real estate probably exceed the book values, and therefore liquidation value might well exceed the NTA on the balance sheet.
These Are The Beneficiaries From The Pipeline Revolution In North America (Part II) [View article]
BRY.TO is interesting but what is your theory about why the net income never seems to show up as free cash flow? In 2010 and 2011 they have negative operating cash flow even with decent positive net income. We can't blame any of this on their capex spend.
I Told You So: These 5 Stocks Have More Downside Than Upside [View article]
I agree with most of these, but Capstone I fail to see a Catalyst there for failing. This company is clearly showing continuous operating improvements and is getting very close to breakeven.
They could well run out of cash before hitting breakeven, but I think you wait for that capital raising and raising enough money to finish executing the business plan to breakeven would be a buy signal.
Investors Ignore What's Happening In Retail At Their Peril [View article]
What's right about RAD: strong and persistent free cash flow.
What's wrong about RAD: 1) negative equity 2) negative tangible equity 3) enormous amounts of debt
Why not use some of that free cash flow to pay down the debt balance?
By any chance is there a private equity firm involved with these guys? Their balance sheet looks like private equity did a number on them to load up with debt.
Investors Ignore What's Happening In Retail At Their Peril [View article]
Assuming forward earnings are wrong and current earnings for FDO around 15 become forward earnings, that isn't much of a revaluation. It wouldn't be a high return short.
Seems more like a sector destined to underperform than to radically reprice.
Investors Ignore What's Happening In Retail At Their Peril [View article]
Thanks for timely sector analysis. I would love to see you do more of those kinds of articles in future, particularly when a trend is in its infancy.
Let's say that companies like Dardens and Family Dollar go flat-growth for the next few years. What is an appropriate valuation in a no growth environment? These are high return on equity companies. I think it is unlikely that even in a no growth environment that they would trade down to book value. So what is a reasonable target valuation?
Amerco: Move And Store Your Cash In This Stock [View article]
You are teaching me something here. Where on the cash flow are they showing the net cash from asset sales? If it is not disclosed there, how do they get away with that? Asset sales should certainly affect cash balances?
In terms of overall thesis, this is a great company, but wouldn't you want to buy this in a recession since it is a cyclical? It would have been great to have seen this article in May 2012 with the stock threatening to break $90 support rather than today as the stock is making new highs and seeking out its full valuation.
The flaw in this analysis is that in a competitive marketplace competitors will take net margins down to 2% to 5%, and growth will come down to under 15% because of declining margins under competition. Only a company with a true monopoly - such as Microsoft or eBay - can sustain both the growth rate and the margin.
For a company that will certainly see competition going forward you are today getting around $20M of free cash flow at a cost of $980M enterprise value. Not a great yield, and certainly not a riskless yield.
StorageGuy, iSCSI over 1 gigabit ethernet gives you around 75 MB/sec of throughput. That isn't very fast. Compared to locally attached RAID of SAS/SATA (which is a commodity) or locally attached flash drives, iSCSI isn't going to compare well.
But iSCSI over 10 Gigabit ethernet would deliver the potential for up to 750 MB/sec of throughput, well in excess of what most locally attached storage systems can deliver. So the storage protocol would no longer become the bottleneck.
For 99% of all end user or computer server applications, my guess is that a potential pipe of 750 MB/sec is more than sufficient. And iSCSI over 10 Gbe lets you put the storage outside the server, and onto the ethernet infrastructure.
It's worth mentioning that Google and NASDAQ computer based traders are freaks of nature with the problems of scale and speed that don't represent more than a small fraction of users. I'm not sure that a successful storage protocol should be held hostage to the problems of such users.
Out of curiosity, how are Google and Amazon handling the issue of storage?
Why I Had To Get Short Lululemon Today [View article]
If you look at the sector in which LULU resides, that sector - like about 85% of all market sectors - was up strongly in the same period.
You reference the Dow. Symbol $INDU on Sept 27, 2012 was around 13.5K yes. And the value on the date of Bret's comment above Mar 20, 2013 was around 14.5K.
You aren't doing even the most basic homework. Why even post.
ServiceNow: Beating Revenues By $4m Does Not Negate Overvaluation Concerns [View article]
Short The Lemon [View article]
Why I Had To Get Short Lululemon Today [View article]
Specific to apparels, look at the sector symbol $GSPLP. But that ascending market is typical of what you will see in about 85% of the market sectors now.
ServiceNow: Beating Revenues By $4m Does Not Negate Overvaluation Concerns [View article]
The market tends to give very irrational valuations to any stock that grows its top line, seemingly giving a pass on earnings or cash flow. Look at CRM, N, or AMZN, all stories that continue to assign completely insane 1990s style valuations based on unprofitable top line growth.
What J.C. Penney Sellers Are Missing [View article]
J.C. Penney Brings Back Discounting; Was The Fourth Quarter Horrible? [View article]
These Are The Beneficiaries From The Pipeline Revolution In North America (Part II) [View article]
I Told You So: These 5 Stocks Have More Downside Than Upside [View article]
They could well run out of cash before hitting breakeven, but I think you wait for that capital raising and raising enough money to finish executing the business plan to breakeven would be a buy signal.
Investors Ignore What's Happening In Retail At Their Peril [View article]
What's wrong about RAD:
1) negative equity
2) negative tangible equity
3) enormous amounts of debt
Why not use some of that free cash flow to pay down the debt balance?
By any chance is there a private equity firm involved with these guys? Their balance sheet looks like private equity did a number on them to load up with debt.
One very bad recession and these guys are cooked.
Investors Ignore What's Happening In Retail At Their Peril [View article]
Seems more like a sector destined to underperform than to radically reprice.
Investors Ignore What's Happening In Retail At Their Peril [View article]
Let's say that companies like Dardens and Family Dollar go flat-growth for the next few years. What is an appropriate valuation in a no growth environment? These are high return on equity companies. I think it is unlikely that even in a no growth environment that they would trade down to book value. So what is a reasonable target valuation?
Amerco: Move And Store Your Cash In This Stock [View article]
In terms of overall thesis, this is a great company, but wouldn't you want to buy this in a recession since it is a cyclical? It would have been great to have seen this article in May 2012 with the stock threatening to break $90 support rather than today as the stock is making new highs and seeking out its full valuation.
A Simple Valuation Of Zillow [View article]
For a company that will certainly see competition going forward you are today getting around $20M of free cash flow at a cost of $980M enterprise value. Not a great yield, and certainly not a riskless yield.
Mellanox: Between Perfect Storms [View article]
But iSCSI over 10 Gigabit ethernet would deliver the potential for up to 750 MB/sec of throughput, well in excess of what most locally attached storage systems can deliver. So the storage protocol would no longer become the bottleneck.
For 99% of all end user or computer server applications, my guess is that a potential pipe of 750 MB/sec is more than sufficient. And iSCSI over 10 Gbe lets you put the storage outside the server, and onto the ethernet infrastructure.
It's worth mentioning that Google and NASDAQ computer based traders are freaks of nature with the problems of scale and speed that don't represent more than a small fraction of users. I'm not sure that a successful storage protocol should be held hostage to the problems of such users.
Out of curiosity, how are Google and Amazon handling the issue of storage?