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  • UPS: Take Advantage Of Irrational Pricing [View article]
    WSJ article: "Amazon, in Threat to UPS, Tries Its Own Deliveries
    An Alternative to Shippers Like FedEx and UPS, New Service Could Deliver Goods the Same Day as Purchased"

    Author Comments?
    Apr 28 06:57 AM | 1 Like Like |Link to Comment
  • Potash Corp: Top Contrarian Value With At Least 20% Upside Potential [View article]
    In a commodity market, low cost ultimately production wins. Comment and comparison of cost of production for the companies in the market (including the former cartel members) would be helpful in this analysis.
    Feb 7 04:30 AM | Likes Like |Link to Comment
  • Nordic American Tanker Can't Generate Cash [View article]
    Key question is how long will it take to wash out competition with higher cash costs than current rates? This is what will bring more sustainable spot pricing back to the market. If operators can't foresee an ability to make cash costs + depreciation (to provide for new ship capex) + profit over the medium to long term then we should see a gradual decrease in operators. If they can't even cover their cash costs in the short term then we should see a decrease much sooner depending on the current liquidity situations of the these operators.
    Sep 5 06:48 AM | Likes Like |Link to Comment
  • Why Friedman Industries Is My New Pick To Click [View article]
    Arohan, agree with your comment in general, however, keep in mind that net PP&E is only $11.3mn of $76.6 mn of total assets for FRD. So scrap value of plant would be less significant item in a liquidation due to high amounts of cash, A/R and inventory.
    Aug 15 03:31 AM | Likes Like |Link to Comment
  • Questioning China XD Plastics' SEC Filings [View article]
    Can you update the link in your comment. Thanks.
    Mar 14 10:08 PM | Likes Like |Link to Comment
  • Friedman Industries: An Undiscovered $10 Stock Yielding 5% [View article]
    A few other less apparent items:
    - founder died a few years ago and son resigned from board. This coincided with more substantial return of cash to shareholders including special dividend. No significant majority shareholder if takeover is contemplated.
    - during the depths of the financial crisis, company burned about $1+mn per year due to highly variable costs (a big positive) at the same time that they lost their biggest customer.
    - they commissioned a new coil plant just around the time of the financial crisis so no need to pump further capital into this area as there is still new and excess capacity.
    - at the depth of the crisis, company traded for about the amount of their working capital (which they unwound to cash. Back then there was a significant margin of safety as the w/c paid for your shares and you got the business for free while it was burning minimum cash to keep the lights on.)
    - My earlier research (admittedly a few years ago) came across a statement in one of their filings which basically said they were not interested in investor comments on how to run the business so this mentality is ingrained in the mindset and probably from the founder.
    - I purchased during the downturn (not because I am so smart but because of the substantial margin of safety) and still hold most of my position. I do not see this becoming a large growth company but rather a cash generative company willing to return money to shareholders with management willing to base their compensation on the true performance of the company.
    Mar 9 02:05 AM | Likes Like |Link to Comment
  • Updating Price Targets And Ratings For 5 Companies [View article]
    THI cash is lower because of significant share buyback over the past quarter and year.
    Jan 9 09:13 PM | Likes Like |Link to Comment
  • 6 Stocks With Unusually Aggressive Insider Activity [View article]
    For JEF, (also, coincidentally, a large LUK holding,) CEO Richard Handler and Executive Committee Chairman Brian Friedman did not purchase but were awarded options that would have a value in stock IF EXERCISED of $757,537 and $180,354. They do not appear to have made a purchase on August 15th. You may wish to also check your details for OI as well. ARCP, same issue as MLI.
    Sep 20 06:18 AM | Likes Like |Link to Comment
  • 6 Stocks With Unusually Aggressive Insider Activity [View article]
    Only one total purchase of 10,422,859 shares of MLI done by Leucadia National Corp. (LUK) who have been persistent/consistent buyers of MLI. Cummings is Chairman of LUK and Steinberg is a Director and President of LUK and this is why they needed to file a statement of beneficial ownership for Leucadia's purchases as they are also Directors of MLI. These are not 3 separate purchases.
    Sep 20 05:11 AM | Likes Like |Link to Comment
  • Three Companies That Can Benefit from China's Stimulus Package [View article]
    correction: 3.77 TRILLION Yuan.
    Sep 9 04:23 AM | Likes Like |Link to Comment
  • The Coming Economic Collapse, Part 3 [View article]
    555' 5 1/8"
    Jun 11 02:41 AM | Likes Like |Link to Comment
  • A.M. Castle Teaches a Lesson in Inventory Accounting [View article]
    Saj, True, I should have indicated pretax profit or operating income instead of net. Also, the $23mn Lifo impact was all in Q1 2009 (total Lifo impact for all of 2008 was about $8mn).

    My point was that these "hidden" assets can also create less obvious but significant impacts on the earnings and cash flows of the business that would need to be considered (they are all part and parcel of the same issue.)

    For example, in the A.M. Castle situation the use of the Lifo 'reserve' has caused a significant acceleration of the 'buffering' of earnings in Q1 2009. Reported operating income for Q1 2009 was $2mn ($22mn for Q1 of 2008.) Taking into account the Lifo impact, this would have lowered Q1 2009 operating income by $23mn to a ($21mn) operating loss. Remember, this impact was only $8mn for all of the year 2008. This would also have a big negative cash flow impact if/when this inventory is replaced at current market prices.

    I'm just pointing out the hidden dangers on and beyond the balance sheet for this kind of "hidden" asset. I agree with you that these types of situations can present hidden opportunities, but your original premise in your post above is very relevant: that companies make accounting choices which can drastically alter the meaning of its financial data that require more than just a scan.
    Jun 9 09:14 PM | Likes Like |Link to Comment
  • A.M. Castle Teaches a Lesson in Inventory Accounting [View article]
    Saj, a good find but you also have to keep an eye on a possible hidden downside that allows the company to recognize more earnings simply by dipping into their LIFO inventory "surplus" over the past year, the inventory FMV less LIFO reported inventory (the LIFO "surplus" dropped from $134mn to $111mn from March '08 to '09. This would have increased reported earnings by $23mn just due to "inventory management" rather than increased sales.
    Jun 8 08:29 PM | 1 Like Like |Link to Comment