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depraved_miscreant

depraved_miscreant
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  • 3 Potential Multi-Baggers For Long-Term Investors [View article]
    I looked at BIP's balance sheet from 3 different sources (AdvFN, MSN, and Morningstar). While the numbers all differ, they all show an explosive growth of LT debt (in the billions). Explanation ? Disagreement ?
    Oct 21, 2011. 05:12 PM | Likes Like |Link to Comment
  • Loans: Currently The Most Viable Choice For Long-Term Fixed-Income Investors [View article]
    I have seen the 'B' word tossed around re Rite-Aid, but these loans are senior to all debt, including secured bonds, are they not ?
    Oct 21, 2011. 04:55 PM | Likes Like |Link to Comment
  • Loans: Currently The Most Viable Choice For Long-Term Fixed-Income Investors [View article]
    I believe these funds and those mentioned by 'birder' are called Participation Loan Funds. Of the 23 'birder' speaks of, I have a watch list of the 10 with the largest portfolios which I have taken my eye off; I will now take another look. Thanks to Mr. Bavaria for the timeliness of his article, since nice discounts currently prevail.

    Essentially, what Participation Loan Funds are is short-term junk (not that there's anything wrong with that). Looking at the top holdings of PPR and EFT, the loans have maturities ranging from 2012 to 2018. There are some recognizable names in the lists, along with obscure companies and a few not-so-stellar firms, e.g., Rite-Aid.

    A negative for me is that most, if not all, of these funds have no track record in a rising rate environment. With holdings having maturities of 1-7 years, I tend to look at these funds as kind of variable-rate short/intermediate term secured bond funds, so they should be OK when interest rates rise, provided the increase is slow and steady and not gap-up.

    Good article.
    Oct 21, 2011. 04:24 PM | 1 Like Like |Link to Comment
  • EasyLink Services: Easy Path To Capital Gains [View article]
    Interesting article, Philip. Once FCF went positive in 2006, it has grown very nicely, as has shareholder equity. Current FCF yield of >15% and Levered FCF Yield >12% tell me ESIC is, at worst, fairly priced.

    The thing that troubles me most when looking at sequential financials is the number of shares. Have there been frequent offerings to raise capital or is management raiding the share cookie jar ? And would you know why the share count doubled, then halved again, between 2007 and 2009 ?

    Other things I like to look at with small caps are the Piotroski Score (3 or 4 -- take your pick) and the Altman Z-Score (1.56). Neither of these scores exactly inspire confidence. Still, I might look into this company.
    Oct 15, 2011. 01:44 PM | Likes Like |Link to Comment
  • Valero Looks Like a Steal At Its Current Price [View article]
    Using my own DCF model with a discount rate of 12% and a conservative growth rate (declining from 4.85% to 3.1% over 10 years), I come up with $47.72. Also noteworthy is the levered FCF yield of 12.5%, as well as strong growth rates in FCF (@11%) and shareholder equity (@15%) over the past decade.

    I've been (kinda) watching VLO for some time, but I've taken my eye off it lately. This article prompts me to take a harder look.
    Oct 12, 2011. 10:58 AM | 1 Like Like |Link to Comment
  • Intel: A High Quality Company, And Fairly Cheap Today [View article]
    My Piotroski F score for INTC agrees with the author's: 7 (down from 9 in 2010). However, I calculate an Altman Z-Score of 6.51, which matches the value I get from another source. The Altman # is used to predict the probability of bankruptcy within 2 years. Since the probability of that is rather low, I don't think it's relevant for INTC, even if the author's number is correct.

    Nice article. Some of my favorite significant metrics are highlighted. I think the author's website might be worth a look.
    Sep 30, 2011. 09:24 AM | Likes Like |Link to Comment
  • The Dumb Dividend Idea [View article]
    "SA pays authors one cent per page view."

    Is that right? I didn't know that. It explains why SA is full of articles like '10 Undervalued Buggywhip Companies to Buy Now' and 'Yogi Berra is Bullish on Nigerian Internet Cafes'.
    Sep 28, 2011. 12:11 PM | 7 Likes Like |Link to Comment
  • The Dumb Dividend Idea [View article]
    Something I would like to see on SA is an 'ignore this author' feature. My SA portfolios generate emails listing articles about the stocks I'm interested in, but some authors' writings on them are just a waste of time. I remember most of those on my 'blacklist', but, frankly, that list is large and growing. Those I follow post rarely, but they're always worth the read.

    I'm not down on David Goldman just yet, but a few more articles like this....
    Sep 28, 2011. 12:01 PM | 3 Likes Like |Link to Comment
  • Investors Should Not Be Complacent About Dividend Champions [View article]
    James, thanks for continually making me consider the risk of an investment. Your treatment of 'The Great Moderation' is another example of how easy it can be to make the mistake of expecting a repeat performance of the 90s.

    BTW, Free Cash Flow Yield is also my #1 metric. Another (related) favorite is Cash Return on Invested Capital.
    Sep 23, 2011. 02:36 PM | 1 Like Like |Link to Comment
  • Market-Timing Should Be A Fundamental Component Of Income Investing: Part 1 - Why [View article]
    There's an old saying about technical analysis: it works just fine, except when it doesn't. That said, I do somewhat agree with the general idea of this article, especially the part about drips. But it takes 'stones' to buy at times like the fall of 2008 to the spring of 2009. You've got to be able to pull the trigger despite the fact that you feel like vomiting, at least in my case. But you can catch some very generous yields.

    I find it easier on my G/I tract to review companies' historical yields. I have developed a spreadsheet which gathers 10-year dividend histories, calculates maximum and minimum yields, and plots the yields against the monthly share prices. 20-year histories are better, but the data are not as easily obtained as are 10-year numbers.
    Sep 15, 2011. 11:14 AM | 3 Likes Like |Link to Comment
  • 6 Of The Highest Yielding Stocks For Very Aggressive Investors [View article]
    Danke, Buck. I should spend more time browsing company web sites....
    Sep 10, 2011. 12:22 PM | Likes Like |Link to Comment
  • 6 Of The Highest Yielding Stocks For Very Aggressive Investors [View article]
    Buck, specifically, what do you mean by "their dividend is more than 50% covered by FCF"? I'm long CTL via the Q merger. Because of CTL's M&A, I'm having a problem figuring exactly what the dividend coverage is. The standard payout ratios I see are 90-110%, although I believe that is vs. earnings, not FCF.

    I bought Q on the cheap. As a result, my yield on cost is a hair under 13%, which I'd hate to give up. But the payout ratios make me nervous. I'm also long CINF.
    Sep 9, 2011. 03:12 PM | Likes Like |Link to Comment
  • Sanderson Farms: Underpriced And Worth A Closer Look [View article]
    I see different numbers for FCF. Total FCF for FY10 was $33.6M (two different sources -- AdvFN and Morningstar). With @22M shares, that's more like $1.50/shr, less than half the amount stated above. And the YOY decrease is larger than that specified: $137.5M => $33.6M.

    Moreover, FCF since 2005 has been positive only twice: 2009 and 2010, but the TTM number is strongly negative: (-$229.4M), due to CapEx, but equally to negative Cash from Operations.

    Based on these results, I find it difficult to believe SAFM is underpriced. Struggling seems more like it.
    Aug 30, 2011. 04:26 PM | Likes Like |Link to Comment
  • Balchem Corp.: Key To Environmentally Friendly Fracking [View article]
    "It's always a bit expensive - the price one pays for quality I suspect."

    I'll say. At current price, BCPC sells for 35-38 times FCF (2.6-2.8% FCF yield). Good company, good story, good article, though.
    Aug 26, 2011. 03:15 PM | Likes Like |Link to Comment
  • 6 Cheap, Unloved Real Estate Stocks With Little Debt [View article]
    How did NLY even make the cut, since debt is their business?

    I am long NLY.
    Aug 25, 2011. 01:12 PM | Likes Like |Link to Comment
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