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  • Seeking High-Quality Companies With Sales And Dividend Growth, And A Reasonable Price [View article]
    Um, the split of Baxter into two companies was announced back in March. The only thing recent about it is the actual name of the new part. See their site for the related investor presentation on Mar 27:

    Highly unlikely to be the driver of today's drop. It came on unusually high volume which means probably institutional. They're usually well informed and not likely acting on 6 month old news.

    Here's the link to the article Richard previously noted about the recall on Sep 16. Hard for me to get excited about that with the little that is reported but perhaps others know more or are twitchier.

    Here's all their press releases this year. Small recalls seem to occur regularly. Again, hard for me to see anything unusually worrying but ...

    Sign me,
    Also Curious
    Long: BAX
    Sep 17 09:25 PM | 1 Like Like |Link to Comment
  • Nobel Prize Winner Shiller Is Damaging His Reputation With CAPE Ratio Talk [View article]
    JasonC, that's a bit disingenuous.

    Based on your other comment about equity allocations you would have trimmed down to 50% equity as early as 1992 - well before the 2000 peak with S&P trading at levels around 400.

    You would have then trimmed down to only 25% equity as early as 1995 when the CAPE exceeded 25 (a level similar to now). This elevated CAPE continued through 1996 (and continued to increase into 2000). The S&P was trading around 650 back in 1995-96.

    The buyback after the 2008 smash would have been to go up to 50% equity at about the S&P 950 level in late 2008 and to go to 75% equity after the March reading when the S&P would have been in the 800s (after having recovered rapidly from the early Mar bottom).

    Summarizing: You'd be exiting at 400 and 650 in the early/mid 1990s and buying in at 950 and the 800s in 2008-09. Certainly not the awe-inspiring signals you imply.
    Aug 22 11:47 PM | 1 Like Like |Link to Comment
  • Kinder Morgan Inc. Will Be A C-Corp Managed Like An MLP [View article]
    pablomike, no, KM did not say that - not anywhere I saw anyway. They said the FULL year 2015 would be 2.00 and they have always paid dividends quarterly. They might change to equal payments throughout the year in which case it would be 0.50 each quarter. But, they have always increased each quarter as I previously commented and I don't see where they said this would change. That would give a ramped dividend somewhat along the lines I showed in my earlier comment.

    Here is their presentation which shows 2.00 as the FULL year 2015 dividend:

    See pages 9-11 as just some examples.

    If you have a reference to where they said the 2.00 was a year-END target please provide it.
    Aug 17 02:44 PM | Likes Like |Link to Comment
  • Kinder Morgan Inc. Will Be A C-Corp Managed Like An MLP [View article]
    The $2.00 dividend is the aggregate planned for all of 2015. Based on their prior history we are more likely to see dividends in 2015 something like 0.48, 0.49, 0.51, 0.52 and in 2016 something like 0.53, 0.54, 0.56, 0.57 for a 10% increase over the total paid in 2015.

    See their history on their site here:

    I don't know where pablomike got his idea of the 4th quarter dividend being much higher than the earlier quarters. Perhaps he could explain.
    Aug 17 10:10 AM | Likes Like |Link to Comment
  • Kinder Morgan Inc. Will Be A C-Corp Managed Like An MLP [View article]
    Chancer, you cant have a negative cost basis. ROC distributions that exceed your basis are treated as capital gains (US).

    I don't think any of us knows how much, if any, of the new KMI distributions will be ROC yet. It appears that distributions will exceed GAAP earnings at least for the initial individual years (due to depreciation) but how that translates to the tax E&P (current and past carryover) is another matter (see comments further down). It's a complex consolidation and perhaps KM will give clear guidance on this later.
    Aug 16 03:09 PM | Likes Like |Link to Comment
  • Kinder Morgan Inc. Will Be A C-Corp Managed Like An MLP [View article]
    searcher, true that the source doesn't matter but I saw on another SA thread about the issue of distributions that exceed earnings and profitability (E&P) are classified as ROC for tax purposes. And, I believe that is correct but perhaps someone with more specialized expertise could shed further light.

    I don't have the link for the other SA thread - sorry. Here's a link to the IRS publication on dividends for corporations:

    See page 19, the section on Reporting Dividends and Other Distributions.

    Note that E&P for this purpose is calculated in its own peculiar way (of course) so I have no idea how the large depreciation element for KMI figures in.

    We will just have to see how it all shakes out on our 1099-DIV for 2015.

    PS: I have received ROC distributions from C Corps having to classify their dividend that way. MCHP was one and if I recall correctly that was due to not having enough E&P from US operations compared to their non-US E&P.
    Aug 15 02:25 PM | Likes Like |Link to Comment
  • Kinder Morgan Inc. Will Be A C-Corp Managed Like An MLP [View article]
    Agreed NC but they can just buy some other MLP and roll it up like they just did for the same depreciation benefits. They won't have a need to create one from scratch. That was my point. Kinder said they see many opportunities for acquisition - I have no reason to doubt that.
    Aug 15 11:57 AM | 1 Like Like |Link to Comment
  • Kinder Morgan Inc. Will Be A C-Corp Managed Like An MLP [View article]
    KMI is a C Corp so follows tax law that governs them like any other US C Corp. Normally that means the dividend is qualified - at least for US holders (i.e., a 1099-DIV).

    But, the dividend will be in excess of earnings at least the first several years due to high depreciation expenses (non-cash) so may be reported as Return of Capital. If classified as ROC, that is non-taxable at distribution but reduces your cost basis.
    Aug 14 11:19 PM | 2 Likes Like |Link to Comment
  • Why Procter & Gamble Will Raise Its Dividend 7-9% Next Month [View article]
    Now that the 10K for the most recent fiscal year is out I thought I'd post my updated charts:

    The cash stress on the dividend is clear on page 2. Between the sale of the pet food business earlier and the recent announcement of the sale of more than half its brands (by number, not earnings), it will be up to management to deploy the new cash effectively. No small challenge.

    The charts paint a clear picture of a company with mostly flat sales, flat earnings, and growing cash stress on the dividend. Lafley is certainly making some good moves, let's hope he succeeds.

    I remain long PG
    Aug 14 11:05 PM | 1 Like Like |Link to Comment
  • Kinder Morgan Inc. Will Be A C-Corp Managed Like An MLP [View article]
    metal, I don't think analysts will have a hard time with the new C Corp. It should be a lot cleaner - just backing out the unusually high depreciation mostly. Even Kinder agreed that trying to manage the various entities was getting a bit much. Analysts will handle it better and be more easily educated.

    As to NC's point, I don't see a need to create a new MLP later on. They'll be buying/consolidating other MLPs in the future and get the larger depreciation deductions as a result.
    Aug 14 10:27 PM | 2 Likes Like |Link to Comment
  • High Quality Stocks For Late Stage Bull Market (27 Stocks) [View article]
    Many years ago (15?) ONEOK *was* mostly a regulated utility. Over time the pipeline business grew to become the largest component. This was a key factor that resulted in the company splitting into two pieces in the last year. It became OKS (pipeline) and OGS (utility) with OKE remaining the GP of OKS.

    Before the split-up S&P categorized OKE and OKS as a utility but now have them in Energy.

    I believe other databases may still be reflecting the original, and now doubly stale, categorization of them as utilities.
    Jul 25 04:55 PM | Likes Like |Link to Comment
  • James Turk More Bullish On Silver Than Gold [View article]
    Yeah, it's fun to look back on old articles.

    See the chart for SLV since Feb 2012:

    (Hint: Turns out he called a top rather than a bottom - oops)

    I found this humorous in his article:

    "People are exiting currencies everywhere around the world and moving into the precious metals."

    Well, OK. But, that just describes buyers. About the sellers you could add that they are exiting precious metals and moving into currencies. Hah.
    Jul 24 02:25 PM | 1 Like Like |Link to Comment
  • Weighted Earnings: They Don't Add Up And You May Get Burned [View article]
    I thought the author did a good job explaining their index methodology.

    In your example, changes in price to either holding result in a change to what their combined earnings are. That is not reasonable. As the author explained, earnings attach to a share - not its price.
    Jun 10 01:36 PM | Likes Like |Link to Comment
  • The Disconcerting 'Wealth Effect' Disconnect [View article]
    SS payments are based upon what people contributed to it.

    If your solution is to have some people contribute more and receive nothing for it that is just a straight transfer from those people to others. That is not the mark of an entitlement program but of a welfare program.
    Jun 5 05:12 PM | 2 Likes Like |Link to Comment
  • Kinder Morgan: Be Careful What You Wish For [View article]
    The Barron's article was a rehash of the Hedgeye (Kaiser) attack, er article, the previous Sep which is when the KM group prices started to drop.


    Of course, it is impossible to measure how much of the price volatility was due to this bad press vs. other matters. That is all speculation.
    May 26 02:38 PM | Likes Like |Link to Comment