Hobski

Hobski
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  • Kinross Gold Corporation- The Highest Growth Potential In Industry  [View article]
    Over the last few years (falling prices), they've been trading in the mid to low single digit area. A lot of them traded in the high teens low 20's during the recent advance in gold from 2003 till 2011. My point was that slapping a 20x multiple on a gold mining company just encourages management to make poor capital allocation decisions. So great, gold goes up a lot, but everyone's cost goes up too. We actually have the inverse of that situation now in the industry. Their prior stupidity has forced them to make good capital allocation decisions over the last 2 years. We'll see how long it lasts.
    Feb 6, 2016. 09:00 AM | Likes Like |Link to Comment
  • Kinross Gold Corporation- The Highest Growth Potential In Industry  [View article]
    Hey Chewy. This doesn't answer your question directly, but I do know that this company traded at roughly 24x EV/EBITDA at year end 2005. That valuation boggles the mind. It's a seven bagger from today's close. It also partly explains why management made so many crappy capital allocation decisions as the gold price rose up until 2011. Paying 24x for a commodity company is inviting management to burn your money.
    Feb 5, 2016. 06:17 PM | Likes Like |Link to Comment
  • Kinross Gold Corporation- The Highest Growth Potential In Industry  [View article]
    This management team is the poster child for misallocating capital in a rising gold price environment. If gold ever gets back to $1700, I'll be selling all of my shares long before $16, unless, of course, a competent management team takes over.
    Feb 3, 2016. 02:07 PM | 2 Likes Like |Link to Comment
  • Still A Fan Of China Mobile  [View article]
    Hey Paulo. Great article. My take on CHL's excessive "cheapness" is due to concerns about a Yuan devaluation. Despite the Chinese authorities denying the possibility of a big 1 one time devaluation, the market thinks it's possible. All else being equal a 30-50% 1 time currency devaluation would probably slam the stock, since their revenue is primarily domestic. Just a thought.
    Jan 23, 2016. 03:15 PM | Likes Like |Link to Comment
  • Goldman Sachs Is Pricing In Another Financial Crisis  [View article]
    Financial stocks trading below tangible book value are not rare, especially in a crisis. I'd say 70%-80% of TBV is more like it. That's where this stock traded in 2009 and 2011. That makes better sense for an entry point if you're worried about a financial crisis.
    Jan 21, 2016. 09:15 AM | 1 Like Like |Link to Comment
  • Draghi: ECB will do what it must to raise inflation  [View news story]
    What Draghi should say is "Currency debasement is our only hope for prosperity". There are so many examples in history where that has ended well. Make sure you get your lecture series payments in gold, Mario.
    Nov 20, 2015. 07:49 AM | 4 Likes Like |Link to Comment
  • Gold Stocks' Fundamentally-Absurd Levels Portend Big Mean Reversion Higher  [View article]
    I agree with you on the undervaluation now in the mining sector. I've bought a few miners in the last 6 months. However, the sector was crazy overvalued (relative to the gold price) for gold's levitation from 2006 till 2011. I realize you mention this, but it's a very important point for anyone new to this sector. That period of overvaluation is not coming back soon, and it should not be thought of as a baseline in valuation comparison.
    Nov 15, 2015. 09:24 AM | 1 Like Like |Link to Comment
  • Stocks and gold lower, yields and dollar higher after FOMC  [View news story]
    Watch what they do. What they say is useless balderdash.
    Oct 28, 2015. 03:15 PM | 3 Likes Like |Link to Comment
  • Oil slumps as Goldman says price could drop to $20  [View news story]
    So IEA is saying US production will decline 4%, while non-OPEC production will only decline about .2%? That's really odd considering non-OPEC production isn't massively lower cost than US production. I don't understand why the production cut difference in these two regions would be different by a factor of 20.
    Sep 11, 2015. 09:20 AM | 1 Like Like |Link to Comment
  • Post rebound, Fed speakers lean hawkish  [View news story]
    The Fed has been basing their policies on the stock market for years now. Sad, but true.
    Aug 28, 2015. 08:29 AM | 5 Likes Like |Link to Comment
  • Paragon Offshore beats by $0.36, misses on revenue  [View news story]
    No one (including the company) knows how long the rig market will stay awful. The longevity of the downturn will determine PGN's fate. If it stays bad for another 2 years, I don't think they'll survive. If it improves by next summer or earlier, this could be a multi-bagger. That's the bet you're making. If they do go under, they will be a value trap case study for business schools everywhere.
    Aug 12, 2015. 05:04 PM | 1 Like Like |Link to Comment
  • CEO exit at Iconix Brand Group fires up selling  [View news story]
    Why would anyone buy this stock today? Management has spent close to $1BN buying back stock over the last few years, and the only thing they have to show for it is an additional $950mm in net debt. The reduced share count doesn't even come close to putting a dent in the increased enterprise value. It's not like their results are all that different from 3 or 4 years ago. In fact, their cash flow has been trending down. Stay away until the conference call. Way too much uncertainty to touch this now.
    Aug 7, 2015. 12:26 PM | 1 Like Like |Link to Comment
  • Fischer: Don't assume series of rate hikes  [View news story]
    Truly shocking to see an economist perceive greater productivity growth as a problem that diminishes the medicine of higher inflation. Complete insanity.
    Mar 23, 2015. 02:52 PM | 1 Like Like |Link to Comment
  • Star Bulk Carriers files for $200M public offering  [View news story]
    Why is this a surprise? They admitted last month that they had about a 100mm funding gap for 2015. There were numerous questions on the conference call about it. It's a big reason why the stock got crushed during/after their earnings call.
    Jan 9, 2015. 08:30 AM | Likes Like |Link to Comment
  • Paragon Offshore: Can This 'Bad Bank' Yield Returns?  [View article]
    If their debt continues to trade in the low 90's, they should seriously consider using this year's free cash flow to buy some of that back. It's EPS accretive while delevering the balance sheet. Most importantly, initiating a dividend with so much rate uncertainty beyond mid 2015 is a coin flip. Why take that chance when you have better options available?
    Sep 9, 2014. 12:15 PM | 2 Likes Like |Link to Comment
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