gmwright's Comments

When Will Transocean Rebound?

Wed, 03 Oct 2012 11:57:24 -0400

I own a decent amount of RIG but got hammered with the share dilution like most others. I still believe it will start a march upwards over the next couple of years but I am hesitant to buy more, mostly due to disagreeing with the managements decisions the last few years. Instead I bought SDRL. I might take a small position in PACD but it's a little too risky for me when you have other solid choices in the sector.

Transocean Vs. Noble: Battle Of The Deepwater Rigs

Wed, 04 Apr 2012 15:20:30 -0400

The Brazil prosecutor is just on a witch hunt/publicity stunt. $11B fine for a 3000 barrel spill? If that goes through drilling companies would have to be crazy to work in Brazilian waters.

Buy Transocean At The Bottom

Thu, 08 Dec 2011 09:12:27 -0500

RIG may be booked but they seriously underestimated their RIG downtime this past year. If they do the same in 2012 then their revenues will come in low again. Rigs can't make money if they are in dock for repairs, upgrades or modifications.

Again, I think RIG is a great company with a nice moat for deep sea drilling, but their management has dropped the ball the past couple of years in my opinion. I think the success of RIG will be despite the management, not because of it. But I do see the price going up, maybe not in the next few months but on the 12-18 month timescale.

Buy Transocean At The Bottom

Thu, 08 Dec 2011 09:06:18 -0500

Jim,

That's true but my understanding was that was only until the $1B special dividend was spent which I think is two more distributions. After that I don't believe there is any guarantee of a dividend. My suspicion is they will go either to no dividend or a very low dividend (<1%) after that.

Buy Transocean At The Bottom

Wed, 07 Dec 2011 16:22:55 -0500

You think the dividend will increase? That shows a pretty big lack of due diligence. Also are you aware of the major dilution they just underwent after issuing shares to pay for the Aker acquisition... after jumping through hoops to declare their $1B special dividend? That shows a serious lack of foresight by management. Also, issuing shares right now doesn't show management has much confidence that the stock price will go higher in the near future. I have a position in RIG and considered bailing but I am sticking around until the full $1B dividend is paid out. But investing in a company with questionable management is always a risky proposition.

Looking For Income And Safety? Check Out Canada's Big 5 Banks

Wed, 23 Nov 2011 10:22:28 -0500

The income is nice but I don't think you can claim any financial stock is "stable" with the situation in the EU and US. I am seriously considering dumping my RY stock at a loss since I think there will be a better entry point in 6-12 months. The Canadian banks do have good cash flow which makes the dividend quite safe (RY did not cut dividend in 2008 despite going down to $25) so if you can get in at a dividend yield of 6.5-7.0% (stock price of 30-32.5 for RY) I would go for it. If more countries in the EU start defaulting I think that is a reasonable price target for RY

A Basic Retirement Plan, And 9 Dividend Income Stocks to Help Get You There

Thu, 20 Jan 2011 13:17:37 -0500

Don't forget to enjoy your 20's and 30's! It's all well and good to plan for the future, but I wouldn't sacrifice the present (at least not too much). I get sad when I think about people in their 20's using all their disposable income to max out a Roth and/or 401k. Would you rather take a trip to Africa or Australia in your 20's or in your 60's?

Try to save something each month and invest and plan wisely (I am a fan of dividend investing) but be sure to live your life to the fullest you possibly can in the mean time. I would aim to have $500 of disposable "fun" money every month (assuming a single person here) and save anything on top of that. If you get to the point of saving $500 and $500 fun money I would increase them both equally from that point onwards. It's all approximate and I personally save slightly more than my fun money each month but I try not to have a large discrepancy.

I'm 32 by the way.

BP's Eventual Bankruptcy Is Certain

Fri, 25 Jun 2010 14:41:30 -0400

It still might be. Don't think they are abandoning this field.

The Housing Collapse Intensifies

Fri, 25 Jun 2010 14:31:44 -0400

Uhhh....2006?

With such low rates it's not a terrible time to buy, you just have to be cautious about what sort of home you are buying. I'm not sure I would buy a home in a new development or in an area of high speculation, but real-estate with great location and limited supply (i.e. in a major city....uhhh other than Detroit) won't tank too far from these points. Mainly because who would want to buy a place out in a development when real-estate prices have dropped such that you can afford a place in the city now. No doubt the tax credit propped up the prices a bit but I expect RE prices to flat-line for several years, but not go down too much from here. Of course they will effectively go down with inflation but so will your mortgage.

BP's Eventual Bankruptcy Is Certain

Fri, 25 Jun 2010 13:43:25 -0400

A lot of these lawsuits will get thrown out. A key point is whether they can be proven to be criminally negligent. Since the regulations were so lax, it comes down to a judgement call and a balance between cost and precaution. BP was definitely leaning towards the side of saving costs but to show that it was to such an extreme as to be criminally negligent and this wasn't just an extremely unfortunate chain of events leading to a disaster is no simple task.

Too many of us have no context on the decisions BP made and the working conditions and the types of decisions that are made everyday on an oil rig. We get most of our information from the media who is definitely going to play to the masses, villify the corporation and sensationalize the story. Is BP responsible? Yes. Were they criminally negligent? I don't know. Are they the epitomy of evil? No.

BP and the Rule of Law

Thu, 10 Jun 2010 12:09:22 -0400

A very good article echoing many of my own thoughts from the perspective as an investor. What I fear most is that the laws will be bent an broken by the politicians to quench the public's and media's thirst for corporate blood. There is a lot of potential here for VERY dangerous legal precedents to be set for incidents in the future.

A Way to Turn BP Around

Wed, 09 Jun 2010 21:34:53 -0400

Taking responsibility is NOT the same thing as admitting negligence.

BP Spill Size Estimates Keep Growing - Along With Potential Costs

Wed, 09 Jun 2010 21:31:54 -0400

Sorry Mark, you need a refresher course on your physics. Relief well will absolutely relieve the pressure because it gives the oil a path of lesser resistance. Flow is dictated not just by pressure but also by conductance or resistance to the flow. Allow the relief well to flow freely then conduct top kill on the broken well head and the heavy mud will greatly decrease the conductance of the broken well head and the flow will be diverted to the relief well, allowing more mud to flow into the broken head, rinse and repeat until the flow is overcome. That's my understanding on how the relief well works.

BP Spill Size Estimates Keep Growing - Along With Potential Costs

Wed, 09 Jun 2010 14:09:04 -0400

Everyone trying to guess the flow, short of specialists in this area are just spewing nonsense. How do you know how much 15k bpd removed from the flow would make the visible flow change? All that's happening is they are taking out the "core" of the leak and letting the "edges" leak out through the vents in the cap. There would be no siginificant change in oil velocity since there has been no change in pressure, and since the outer edges are still flowing it would look unaffected to an untrained eye.

Another point is that Exxon spill took place at the shore (more or less) so a large fraction of that oil hit the coast. Here it is more dispersed, which brings additional costs in terms of shoreline affected, but the impact (when compared to Exxon spill) will not be so severe at these coastlines. Plus clean-up is actively happening immediately after the leak and on a scale far beyond what happened in Alaska. So I agree that a linear relationship is not likely, I think the inflation adjusted-$270 is more likely a top estimate than a bottom.

Plus the idea that total liabilities is greater than a year of cash flow for BP could lead to their bankruptcy is an extremely far reach. These costs are not going to be dumped onto the CEOs desk as one lump sum. This will be stretched out over many years. The fact that BP can almost cover the costs with cash from one year of operation should be a huge testament as to what an impressive cash flow this company has. The US government should be careful at how hard they push BP and how much they attack. Otherwise BP may just decide to spin off BP america, have it go bankrupt and then guess who is left footing the bill?

A Way to Turn BP Around

Wed, 09 Jun 2010 13:46:38 -0400

I think it will be quite difficult to prove BP was negligent. Sure the public will be wanting them to be proven negligent so they can throw the big, bad corporation under the bus, but the courts shouldn't cave to that pressure in any way. If it is the lack of regulation and safety standards that are at fault then BP is free and clear of any negligence. The problem is that there is so much one-sided lynching of BP in the media I have no way of knowing if their procedures were standard for an oil rig or if there was reasonable cause for them to foresee this disaster or if this was a borderline call that turned against them in a catastrophic and unforeseeable way.

Apple Unveils the iPad, At Last

Thu, 28 Jan 2010 00:04:20 -0500

To me it is a device that is kinda useful for everything but doesn't excel at anything. I guess websurfing is the best aspect of the iPad. But I can tell you that emailing will be a pain because you are either typing with one hand and holding with one hand ore typing with both hands while this thing sits flat on a table. And the keyboard dock kills the whole portability aspect of it. But if you want portability than an iPhone is the better option and there is no way this thing is a better e-reader than a kindle or any other e-reader that uses e-ink. Backlit display and glossy screen does not make a good e-reader. Plus who would want to always be sucking limited battery life to use something as your main book reader? I can't see it making a big dent in the e-book market in the longterm.

I was hoping for some revolutionary technology or feature that would seperate it from the bounty of other portable devices out there. But there is no new revolutionary technology. There are no surprises (other than price) and given the hype behind this I was expecting something with a bit more impact.

I don't think it will totally flop like Apple TV but it is not a revolutionary product like the iPhone or iPod. I would guess it will have similar impact on the AAPL bottomline as the Macbook Air, in other words, nothing. Just my honest opinion. Proceed to call me ignorant and misinformed if you wish.

Wall Street Breakfast: Must-Know News

Fri, 22 Jan 2010 10:03:11 -0500

Curious how most are beating earnings again but market is tanking, when last quarter everyone beating earnings sky-rocketed the market. It truly does feel like Vegas out there.

Wall Street Breakfast: Must-Know News

Tue, 12 Jan 2010 09:31:38 -0500

The Banks can't make up $120 billion in customer fees. The banks barely make any money off their typical deposit/withdrawl banking clients. If I remember correctly, ~80 % of their profit comes from trading.

Dividend Progress Report: October 2009

Tue, 10 Nov 2009 09:05:39 -0500

I believe D4L dividend stocks are mostly in 401K and IRA accounts so I would guess the surcharge tax would not affect those. If you are speaking more generally, since this also applies to capital gains I would think it would affect growth and dividend stocks equally.

If Goldman Is Selling, Are You Buying?

Mon, 02 Nov 2009 08:20:24 -0500

This makes me feel ill. Of course I could invest in GS stock and probably make lots of money. After all, they seem to hold all the cards and make all the rules (or at least have free reign to ignore them).

But when I read stories about how they are duping pension funds and sifting money and transactions through off-shore accounts why would I want to invest? Pension funds are for the retirement of hard working americans. If I invest in GS to make money, I might as well just go and beat up an old lady and take her purse. Sure GS does it in a much less personal way, but they are essentially doing the same thing.

This is why I will never invest any of my money in GS (or PM, MO, LO for obviously different reasons).

Ten Stocks for the Next Ten Years

Wed, 28 Oct 2009 06:07:14 -0400

It was a Korean national oil company that agreed to purchase Harvest Energy Trust, not a Chinese company.

Wall Street Breakfast: Must-Know News

Mon, 26 Oct 2009 08:31:57 -0400

73 % of panelists see GDP growing 1-3% in 2010. To me that isn't very encouraging. A spread between 1-3% GDP growth is very big gap to me since I would consider 3% to be significant growth and 1% to be more or less stagnant economy. Plus this also means more than 1 in 4 of the panelists thought the economy would grow <1% or even shrink I suppose, which would definitely be a harsh reality for US equity to handle.

How Apple's Market Share Will Propel Stock to $500, Part 1

Mon, 26 Oct 2009 06:58:01 -0400

In terms of corporation sales another thing to consider is that more or less all IT staff are trained in Windows and not the MacOS. At my work I requested they buy me a Mac instead of a PC, which they said they would but I receive no support from the IT department. I appreciate that the MacOS is more or less straight forward, but if I do get stuck somewhere it is my own hours to get it sorted (and pray I don't make it worse) rather than just having an IT guy come and fix it in 30 minutes or less.

So you can imagine that the MS dominance in corporate america is driven by a lack of MacOS IT staff. And surely corporations are more concerned about software than hardware, and has been previously mentioned and acknowledged by Apple, MS has won the OS war.

All that being said, I think AAPL has a bright future as it fills in the cell phone market and perhaps finds another niche with the rumoured tablet (but I personally have doubts about the tablet). Still a $500/share price target is a bit much. $300/share I could see in the next 2-3 years given the iphones growth globally and potential from the itablet. But someone mentioned dropping margins on the iphone already and that is another good point that could limit earnings growth.

Wall Street Breakfast: Must-Know News

Fri, 23 Oct 2009 07:58:42 -0400

I'm not surprised to see AMZN and AAPL doing so well. I have constantly been scared off by high p/e ratios and price/book values for these two companies in particular. When in reality I should've listened to Peter Lynch and just gone ahead and invested in these companies because they are clearly the best at what they do. I can understand how they work and why they work, and I personally enjoy both their products/services. I will probably start acquiring some AMZN in the near future as I think they will do well this holiday season compared to other retailers. I may wait for AAPL for more details of the tablet to come out.

8 Dividend Stocks with Wide Moats

Fri, 23 Oct 2009 06:13:09 -0400

I think one of the points is that a dividend investor is not so concerned about his capital losses as long as the dividend remains the solid and ever-growing.

Losses don't count until you cash out and dividend investors definitely take a much more long view on things. In the meantime if the dividend remains the same and stock price decreases than your yield has gone up, and if the fundamentals remain strong it is a good time to buy more.

On Oct 22 09:43 PM JSW wrote:

> What unadulterated crap some of this is. "the good ones not only
> survive, they thrive." Well if you had been stupid enough to buy
> Eli Lilly 10 years ago and hold it, you would have had a 63% decline
> in price and if you only held it for the last 5 years, you would
> only have lost 50% of your investment. Good dividends don't make
> up for losing most of your capital.

Wall Street Breakfast: Must-Know News

Thu, 22 Oct 2009 10:45:34 -0400

Already some predictions from companies that holiday shopping could be way down this year. We seem to have navigated through Q3 okay but maybe it will be Q4 that gets us back to reality with a hefty and over-due correction.

Wall Street Breakfast: Must-Know News

Wed, 21 Oct 2009 09:44:34 -0400

Sadly for me, investing in GS is like investing in PM or MO. It just doesn't sit that well with me since I can't seperate my moral views from my financial views. But my moral views have lost me a lot of money haha! Investing in GS is like betting that a casino will make money off of gamblers. All the odds are in their favor. But that is exactly the reason why it doesn't sit well with me. I feel too much like the schmuck gambler that GS is sticking it to.

Dividend Aristocrats: 3 to Watch

Wed, 21 Oct 2009 05:25:20 -0400

Personally I like BP more than XOM for a dividend play in oil. Somewhat similar to WMT, XOM is so huge, further growth on a meaningful scale becomes difficult. No doubt they are a cash cow, but so are most oil companies. BP is not much different, has increased its dividend every year since 1999 and sports a 6% yield.

The only concern is the margins are lower than some of the other oil plays like CVX or XOM, but I am encouraged with BPs recent success in Africa.

Is Saving Really for Suckers?

Tue, 20 Oct 2009 08:37:47 -0400

I would say you make the banks even more money by putting your money into equities. Just look at how much of their income came from FICC and how much came from trading.

Plus I would argue a "savings account" is not equivalent to saving, which is somewhat insinuated in this article. What I mean is that "Saving is for suckers" is definitely not the same statement as "Savings accounts are for suckers". Overall his comments come across as reckless to me. As you quite accurately mention at the end, one can't just ignore the risk factors in owning equity. You would think people would've learned this lesson now, but still there are those who preach to just put it all in stocks and let the historical trend take over.

Jobless Recovery: Few Winners, Many Losers

Tue, 20 Oct 2009 05:02:49 -0400

It's tough. I share many of the same views in terms of the unsustainability of the recovery but there is no clear indication that anybody has learned the lesson. I thought banks/financials and the large caps could drive the recovery from gov. stimulus and a recovering stock market (trading profits) but now AAPL is reporting monster numbers.

Who is buying these luxury AAPL items if things are so rough? These are numbers you can't make up (I hope) which show that there is still a lot of money willing to be spent by the consumer. Is it money they have to spend? I don't know, but this is the problem with trying to apply logic to the consumer or to the stock market. Sure you may be proven right in the end... but the end could be a long way away.

These times are truly a test of your convictions in your investing strategies and opinions. Just remember that a good investor is always open to changing their opinion.