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  • Kinder Morgan investors approve merger [View news story]
    The new KMI shares I received from the KMR conversion already appear in my Schwab account. Contact your broker.
    Dec 2, 2014. 06:55 PM | 1 Like Like |Link to Comment
  • Sell, Sell, Sell... The Central Bank Madmen Are Raging [View article]
    "everyone all making the exact same mistake at the exact same time"

    You are over-generalizing financial bubbles. Even in a vibrant bubble not *everyone* is invested *exactly* the same. Contrarians fade a bubble, some folks ignore it and others thoughtfully avoid it.

    It only suffices for *enough* people to follow the same trend to create a fad or a bubble.

    You are creating scenarios (and definitions) that don't exist in real life. You should not be surprised that others are not swayed by your artificial examples.
    Nov 25, 2014. 04:15 PM | 6 Likes Like |Link to Comment
  • Sell, Sell, Sell... The Central Bank Madmen Are Raging [View article]
    "Only when there is an universal coercing mechanism, like a gov gun compelling people into that trend."

    Hogwash. Trend following is part of human nature. It occurs in fashion, music, behaviors, fame, etc. Remember any of these? Beanie Babies, pet rocks, tie dye, disco, hula hoops, bell bottom jeans.

    Fads are part of human history and finance is no exception.
    Nov 25, 2014. 03:30 PM | 4 Likes Like |Link to Comment
  • Kinder Morgan investors approve merger [View news story]
    KMR Holder, why are votes not cast counted as NO vote?
    Nov 20, 2014. 06:26 PM | Likes Like |Link to Comment
  • Deflation? [View article]
    Adding further to Jason's clarification ... In the S&P 500, the Financial sector makes up about 8% of the total earnings in the last 3 years through 2Q2014 (the most recent full quarter). This sector includes banking of course but also insurance, brokerages, and related.

    The largest sector was Energy at 19% followed by Health Care and Info Tech - both at 14%.

    This data is found on S&P's website in the Index Earnings spreadsheet under the Additional Info tab on this page:
    Nov 17, 2014. 09:07 AM | 2 Likes Like |Link to Comment
  • Dividend Aristocrats In Focus Part 23: Is It Time To Sell Leggett & Platt? [View article]
    Author, your fixation on earnings payout ratios leads you to narrow conclusions about the state of their dividend. If you look at the dividend as a percent of operating cash flow or free cash flow you would see a much different picture. Earnings can have significant non-cash components (and did in this case) which won't tell the whole story on what cash a company has available to allocate.

    For example, the earnings payout ratio made LEG's dividend look in danger during the smash but the cash flow painted a different picture.

    Here is a link of some charts for LEG. Look at the "Mstar Cash Flow Stmt" chart to see how much of OpCash and FreeCash was spent on the dividend.

    Technical footnote on the chart: The dividend/share amount on this chart was derived from the annual report's cash flow statement. It is simply the total cash paid for dividends in that fiscal year divided by the weighted number of shares outstanding. It might be clearer to a wider audience if I showed the total amount of cash paid but I prefer it as per-share. The number varies slightly from the actual amount paid per share due to varying number of outstanding shares during the year. This does not distort the cash payout ratios shown as those are derived directly from the totals.

    Long: LEG
    Oct 25, 2014. 01:50 AM | Likes Like |Link to Comment
  • Reasonably Reliable Leading Indicator [View article]
    Given SPX earnings have been steadily increasing since the start of 2009 the recent drop in your charts must be due to the adjustments for inventory and capital consumption. Could you shed more light on what these adjustments are?

    Also, how much history have you studied in this light (the chart shows part of only one cycle)?
    Oct 5, 2014. 09:23 PM | Likes Like |Link to Comment
  • 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, 2014. 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, 2014. 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, 2014. 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, 2014. 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, 2014. 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, 2014. 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, 2014. 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, 2014. 11:19 PM | 2 Likes Like |Link to Comment