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  • Nokia (NOK +4.7%) has cracked the $4 barrier today. Possibly helping is a Bloomberg report that HTC has shelved plans for a large-screen Windows Phone due to the fact WP8 doesn't currently support 1080p displays. HTC recently launched the Droid DNA, an Android phone with a 5" 1080p display. [View news story]
    Guys, what do you think about this interpretation of the Nokia situation the next two months going forward.

    At the moment we have lots of rumors and lots of talk about Nokia being very successful. Those who believe have already positioned themselves. What the remainder of people that are still on the sidelines are now waiting for is some kind of official prove that the good news about Nokia are for real. This kind of prove will only come in with the quarterly results towards the end of January.
    (or Jim Cramer recommending the stock?) Some insiders will already know about the results a week before and speculation might start another week before. Until then (January 15th) we will all be in the limbo and bears dominate having an easy game to scare of people and increase insecurity with stories about supply shortages being fabricated, ...

    So my prediction until mid January: stagnant or slightly declining share price. A further reduction of volatility. Then speculation about positive Q4 results should pick up and we may see a similar run-up of the share price like we had it just before the Lumia 920 was presented.

    Your opinion?
    Dec 17, 2012. 04:19 PM | Likes Like |Link to Comment
  • The Bull Case For Hewlett-Packard [View article]
    great synthesis
    Dec 16, 2012. 09:28 AM | Likes Like |Link to Comment
  • The Bull Case For Hewlett-Packard [View article]
    Sure. I am not saying that goodwill has no value. You pay for it, so if you are not overpaying like HP, there are cash-flows associated with it. I am actually saying exactly that. The value of goodwill is reflected in the cash flows. Way before there will be any write-downs. For the savy investor write-downs have no informational value because a good investor will have noticed way before (maybe even at the time of acquisition) if the company is worth the money and producing the estimated cashflows or not.

    The same as with credit ratings. No informational value. They are just rubber-stamping what most people already know before.
    Dec 16, 2012. 09:24 AM | Likes Like |Link to Comment
  • The Bull Case For Hewlett-Packard [View article]
    So what? This is all a thing of the past. And a stock price is about the future. The fact that HP failed with its past acquisitions is actually further reason to believe that HP management will not take the risk to engage in additional M&A activity. Because nobody will understand them making the same mistakes again. Management is pretty aware of that.

    It is the same as with terrorist attacks. If an attack happened at a certain place the risk of another attack at the same place the days or weeks after has actually become lower (more police, more security, there are now easier targets, ...). It is always just subjective(!) risk that has increased.

    Unfortunately most people are too stupid to understand that. They see the 'evidence' and consider themselves clever to repeat the newsreel over and over again. Like they had known it all before.
    Dec 16, 2012. 09:19 AM | Likes Like |Link to Comment
  • Mongolian Cement Company Poised For Liftoff [View instapost]
    Sorry, I forgot to add the link to the Mongolian Stock Exchange
    Dec 14, 2012. 09:17 AM | Likes Like |Link to Comment
  • Cisco: Everything Is Priced In [View article]
    Who is Jimmy Cramer? I am not from the States. Is it a good investor like Warren Buffet of George Soros?
    Dec 14, 2012. 09:16 AM | Likes Like |Link to Comment
  • Cisco: Everything Is Priced In [View article]
    True. But there is a solution to that.
    Take the current discount rate for the first 10 years, then take the historic average for the years going forward.

    You will see that the changes after year 10 are actually not so dramatic in terms of value. At least for a stock that is already profitable right now.

    I guess like of the value of the DCF is within the first 10 years. Maybe 50% or even more?
    Dec 14, 2012. 09:15 AM | Likes Like |Link to Comment
  • The Bull Case For Hewlett-Packard [View article]
    Goodwill and goodwill impairments are not related to the future. They are just sunk costs. If there is an impairment or not does not matter. It only matters if the business related to the goodwill created cash-flow or not. Sorry, for explaining the 101 of stock valuation, but it just annoys me to hear about extraordinaries being extrapolated into the future or looking at goodwill and what happens to book values.
    Dec 14, 2012. 09:10 AM | Likes Like |Link to Comment
  • Mongolian Cement Company Poised For Liftoff [View instapost]
    Where can I get a stock quote and history? If I look here:
    I just get a history back to July :(
    Dec 13, 2012. 05:14 PM | Likes Like |Link to Comment
  • ACTC And The Ghosts Of Christmas [View article]
    What is the reason for the extreme share price increases at the end of 2008 and 2010?
    Dec 13, 2012. 03:15 PM | Likes Like |Link to Comment
  • Cisco: Everything Is Priced In [View article]
    "required rate of return of 14% which is an approximate average of the WACC over the past several years"

    Are you serious? The average WACC for the US stock market or Cisco? Ok, lets assume, that the average risk-free-rate was on average 5%.

    Then you have a market risk premium of 9%. I find this really exagerated.

    Or is it just the avg. WACC of Cisco? Than you are using a really high beta, right? Does not make sense to me, because looking at the charts it seems like since 2003 the correlation to Dow was rather low, and relative volatility as well. So looking forward, the beta should also be low, maybe even below 1
    Dec 13, 2012. 03:03 PM | Likes Like |Link to Comment
  • Why Target Frontier And Emerging Markets? [View article]
    Hi Jon, thanks for your long and enlightening answer.
    Do you still need a deputy? ;) It must be so exciting to work with you.
    Well, I still have to finish my Ph.D. in the next month. And then I have to see if I get back into finance or consulting.

    Did you ever think about writing something like an "adventure investing" type of book? I think Jim Rogers has written one. I am pretty sure you have enough stories to tell as well.
    Dec 12, 2012. 04:41 PM | 2 Likes Like |Link to Comment
  • Why Target Frontier And Emerging Markets? [View article]
    Hi Jon. Your deep-dives on frontier markets are always excellent and you are certainly one of the most sophisticated investors on sa. So, I hope you do not hold it against me, if I raise some criticism against this article, which I find is unfortunately not as deep as all your other articles.

    1. You are drawing an analogy between tech stocks and frontier markets. Fair enough, as it highlights the fact that stock-picking is really crucial. Unfortunately you do not continue to describe how to pick the Apples and not the Alcatel-Lucents of frontier markets
    2. "Try to define the target": Broad MIST or frontier ETFs are BS. Point taken. I agree 100% :)
    3. Qatar. Interesting case. But again in the Gulf region, there are a lot of other countries that did not fare so well. I remember there was a big hype around GCC countries just before the burst of the "oil price"-bubble. I know because I lost some money with an Arabia ETF. Question: What did Qatar do right, and others in the region wrong?
    4. Economic growth. I do not believe in GDP growth as such. What really matters is growth in GDP/capita. In all these countries like Iraq and Egypt you have huge fertility rates, that is lots of "angry young males", which is not good with respect to political stability.
    5. Best performing stock exchanges. True, there is a lot of potential, but also a lot of volatility. Just looking at the chart and seeing Argentina. No thanks ;) Again, I think you should go one step further and compare growth and volatility.
    6. The debt clock. Ok, lets be honest. You know that this chart is misleading. 10000USD/capita in public debt is not a lot for a rich, but a lot for a very poor country. This chart really compares apples and oranges.

    I would really be interested to get to know the screening criteria that you use in order to identify interesting markets. Because honestly, the fact that a country is growing, just because population is growing like hell (so capital accumulation can not work) is not a convincing nvestment story for me.

    If I had to rank countries in terms of attractiveness I would probably look at the following criteria:
    - cheap valuation (obviously)
    - (improving) political stability, or alternatively a catalyst/turnaround i.e. a positive change in government (positive: Cuba, Zimbabwe, Burma; negative: Iraq)
    - exploration of natural resources, foreign aid, trade liberalization, completion of a big infrastructure project or another catalyst that will boost growth

    Countries like Mongolia, Greenland, or Myanmar are interesting. But, again, I cannot see the point to invest in Argentina, Iraq, Egypt or some other country on a downward trend.
    Dec 12, 2012. 07:34 AM | 2 Likes Like |Link to Comment
  • LyondellBasell: Attractive Valuation, 34% Upside [View article]
    Nice, but what makes the chemical industry attractive? Why are earnings increasing? Volume? Prices? Any insight?
    Dec 11, 2012. 10:05 AM | Likes Like |Link to Comment
  • AUD: Long-Term View Requires Caution [View article]
    There are many more aspects to the AUD, arent there?
    The real estate bubble, the carry trade that is going on between Australia and the rest of the world, the Dutch disease. These are just some buzz words, that may play a role.
    Dec 11, 2012. 09:26 AM | Likes Like |Link to Comment
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