Is The Board Asleep At Edgewater Technology? [View article]
It has 20+ million of NOL asset which does not yet reflect on the balance sheet. It is retaining the cash for acquisitions to increase earnings to utilize the NOL.
What Warren Buffett's Investment In Bank Of America Doesn't Tell Us [View article]
IMHO Buffett examines the bank both qualitatively and quantitatively. He saw that the new management is doing the right think and voiced his support. For banks, management is absolutely critical.
He looks at the bank in terms of its earning power. (What would pay for a Harvard educated doctor who took huge debts but can clear those in next 5 years and thereafter as long he doesn't repeat the same mistakes, his future is extremely bright?)
It is cheap, as long as BOA doesn't burn thru its equity (it did not last year and if next 2-3 years are not worse than the previous year it should do OK). Yes you will not see decent dividends and earnings will be eaten away by continuing losses but 3-4 years from now, it should be back on solid footing and ready to grow domestically and internationally. IMHO that is what Buffet sees in the company ...its future is bright and on that basis it is cheap.
It has assets worth 2 trillion which are expected to grow. A bank like that in normal times can easily earn 1% or more on its assets which works out to be 20 billion. The bank is selling at roughly 80 billion now...so at current price, it is at a P/E of 4 expected 2016 earnings. Now if in 2016 the P/E normalizes to 10 or above, the stock would be worth 2.5 times today's price ($20) plus of course the dividends would be higher. That is approx 30% rate of return at today's purchase price.
Why I'd Avoid Buying Berkshire Hathaway Now [View article]
The problem I have with you or others writing such articles without complete knowledge is that it may mislead other new comers to investing world. The title of your article as well as the mention of PE are also very misleading....unless that was your intent, you should not suggest (you can ask or seek an opinion or clarify doubts) an investing opinion ....enough people are doing that deliberately. Your purpose for writing did not seem a deliberate attempt to mislead but still ended up misinforming the readers.
Why I'd Avoid Buying Berkshire Hathaway Now [View article]
Doesn't matter when you started investing. How much time have you spent acquiring investing/business knowledge...without which experience in market has limited value. I don't write an essay because it has already been written in the Annual Report by Mr. Buffett...he has clearly explained on how to evaluate his company. He also said two different people will come up with two different valuations but the point is not the precise valuation but to arrive at a conservative value. The operating businesses (excluding stock holdings) are earning 11 billion a year and has grown at 20% in recent past..including dividends the company gets a cash of 1 billion per month which can be used to buy more operating businesses or stock purchases...again to reiterate this 12 billion per year doesn't account for operating earnings of WFC,KO, AMX, etc....so if you subtract all the holdings from the market value then your PE for operating businesses is approx 3 (Tilson has explained this well in his presentation).
Other things you may want to consider - 1)Are operating earnings likely to increase when the housing related businesses (Acme, Mitek, Shaw, Benjamin Moore, etc) turn around? 2)Since Buffet is not paying out the 12 Billion excess cash every year, would he be able to create more than 12 Billion value from reinvesting that money
Why I'd Avoid Buying Berkshire Hathaway Now [View article]
You are obviously new to investing. Just because you can write an article doesn't mean you should. PE is immaterial here unless you account for earnings of the portfolio companies. When Berkshire reports earnings, it doesn't include earnings of Wells Fargo, Coke, etc. So best way to evaluate is to account for holdings part as a mutual fund. All holdings (including cash) account for approx 100K of each A group share. So you are paying 20K (of each A group share) for earnings of rest of the 70+ businesses including Burlington, Mid-American, etc...those earnings are approximately 6K per share and likely to be 7K per share next year. So in effect you are paying a P/E of 3 for rest of the business.
One Of The Best Banks In Latin America Selling At A Great Discount [View article]
Isn't the inflation rate in Argentina almost 20%? So how is a 20% return on equity a good performance?
Also you say "U.S. dollar has been loosing ground against the Argentinian peso over the past 5 years." ...it is the opposite...the peso has lost ground to USD.
Also a comment on your other investment choice - IMAX --the company has been selling its own shares so they don't see any value in the current price. Also based on all metrics, IMAX is expensive.
Why Buying These European Stock Bargains Suddenly Makes Sense [View article]
Re Telfonica:
Well how much of their business is from outside Europe? The company has significant debt...even so it is cheap.
Their European revenue are sure to be hit hard as Europe reduces leverage. Many businesses (small/big) will be out-of-business in next several months and company is bound to lose that revenue which will hit the bottom line. Current (cash flow-capital expenditure) is about 12 billion of which 8+ billion goes to pay dividends.
The stock is cheap but not cheap-enough. You could find better bargains in US. Sanofi looks very cheap based on free cash flow and they have been buying back stock.
Finding the Silver Lining in Research in Motion's Earnings [View article]
Utter nonsense. Microsoft is a software company...period. XBox is as far as they would go in hardware because Gaming consoles is a good business. Smartphone is becoming a commodity. Microsoft would gain nothing by buying RIMM when it is loosing market share. In near future you would see tons of very cheap smartphones.
Tejon Ranch: Like St. Joe's With Berkowitz Upside at Einhorn Prices [View article]
I had taken some interest in this stock couple of years ago but decided for the dust to settle on real estate decline. Finally happened to drive through this area. The ranch area is miles from any major city and except for the road sign, nothing about this region looked any different from miles of barren land along I5.
Is there a good economic reason for any significant development so far away from major cities?...California is not running out of land space.
Market value of iGo is approx 100 million (at around $3 per share). What impact does 2.5 million of revenue have on the stock? Mr. Heil has off-loaded 15-20% of his stock holdings at prices of $2.8 and lower....he doesn't seem as optimistic as you. Agreed the company would have increased revenue in the holiday time period but then that is already priced in the stock....don't see how even a 10 million increase in revenue should have any significant impact to the bottom line.
Also in your article, when you say 2.5 million of deferred revenue....but that doesn't tell you what component of it is profit....even at 20%, it would add only 0.5 million to the earnings in the peak season...which is relatively insignificant given the market cap of 100 million.
3 Undiscovered Value Stocks: Update [View article]
MHH is still a great value. They added 1 million to book value in 2009 inspite of making an 1.2 m acquisition. Cash+Recv-AllLiabilities is approx 3m....so you get to buy a 80m revenue company for 3m.
Is The Board Asleep At Edgewater Technology? [View article]
What Warren Buffett's Investment In Bank Of America Doesn't Tell Us [View article]
He looks at the bank in terms of its earning power.
(What would pay for a Harvard educated doctor who took huge debts but can clear those in next 5 years and thereafter as long he doesn't repeat the same mistakes, his future is extremely bright?)
It is cheap, as long as BOA doesn't burn thru its equity (it did not last year and if next 2-3 years are not worse than the previous year it should do OK). Yes you will not see decent dividends and earnings will be eaten away by continuing losses but 3-4 years from now, it should be back on solid footing and ready to grow domestically and internationally. IMHO that is what Buffet sees in the company ...its future is bright and on that basis it is cheap.
It has assets worth 2 trillion which are expected to grow. A bank like that in normal times can easily earn 1% or more on its assets which works out to be 20 billion. The bank is selling at roughly 80 billion now...so at current price, it is at a P/E of 4 expected 2016 earnings. Now if in 2016 the P/E normalizes to 10 or above, the stock would be worth 2.5 times today's price ($20) plus of course the dividends would be higher. That is approx 30% rate of return at today's purchase price.
Will iGo's Chip Be In The Next iPhone? [View article]
Why I'd Avoid Buying Berkshire Hathaway Now [View article]
Why I'd Avoid Buying Berkshire Hathaway Now [View article]
Other things you may want to consider -
1)Are operating earnings likely to increase when the housing related businesses (Acme, Mitek, Shaw, Benjamin Moore, etc) turn around?
2)Since Buffet is not paying out the 12 Billion excess cash every year, would he be able to create more than 12 Billion value from reinvesting that money
Why I'd Avoid Buying Berkshire Hathaway Now [View article]
Evidence That Warren Buffett Manipulated The Silver Market In Late 1990s [View article]
One Of The Best Banks In Latin America Selling At A Great Discount [View article]
Also you say "U.S. dollar has been loosing ground against the Argentinian peso over the past 5 years." ...it is the opposite...the peso has lost ground to USD.
Also a comment on your other investment choice - IMAX --the company has been selling its own shares so they don't see any value in the current price. Also based on all metrics, IMAX is expensive.
Why Buying These European Stock Bargains Suddenly Makes Sense [View article]
Well how much of their business is from outside Europe? The company has significant debt...even so it is cheap.
Their European revenue are sure to be hit hard as Europe reduces leverage. Many businesses (small/big) will be out-of-business in next several months and company is bound to lose that revenue which will hit the bottom line. Current (cash flow-capital expenditure) is about 12 billion of which 8+ billion goes to pay dividends.
The stock is cheap but not cheap-enough. You could find better bargains in US. Sanofi looks very cheap based on free cash flow and they have been buying back stock.
Edgewater Boasts Attractive Free Cash Flow [View article]
MHH and RCMT (both IT serv) are similarly value at almost (cash + recv = liabilities).
Finding the Silver Lining in Research in Motion's Earnings [View article]
Tejon Ranch: Like St. Joe's With Berkowitz Upside at Einhorn Prices [View article]
Is there a good economic reason for any significant development so far away from major cities?...California is not running out of land space.
Here Goes iGo [View article]
Also in your article, when you say 2.5 million of deferred revenue....but that doesn't tell you what component of it is profit....even at 20%, it would add only 0.5 million to the earnings in the peak season...which is relatively insignificant given the market cap of 100 million.
3 Undiscovered Value Stocks: Update [View article]
When Good Will Turns Bad [View article]