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  • Frannie investors find a friend in Sen. Toomey [View news story]
    the gov is perfectly within its rights to take away the guarantee. Lets see what the stock is worth without the gov guarantee. Who would want their mortgages insured by FNMA and Freddie Mac without the gov guarantee. I love it how supposed free-marketers like Toomey are saying how shareholders are getting screwed. The shareholders are banking on making money off the gov guarantee and know full well that if the guarantee goes away the companies are worth nothing.
    Mar 11 11:11 PM | 2 Likes Like |Link to Comment
  • Fundamentally And Technically, Fresenius Wins Big Over DaVita [View article]
    The author shows a real lack of understanding of this industry. Assuming that 21% of DVA's patients are non US citizens is quite ridiculous. If he understood the way the ESRD program works it might help him understand the industry better. Medicare only kicks in after 30 months of commercial insurance are used up. So the other 21% of patients are more than likely US citizens who have private insurance and have recently started a dialysis program and are not yet using medicare/medicaid.
    Dec 5 02:50 PM | 4 Likes Like |Link to Comment
  • Potash Corp CEO Has To Go [View article]
    Its not just this though. Doyle has been way too optimistic for the past few years and has been wrong on demand picking up for a while. He always points to india eventually needing to buy more and other reasons for demand too pick up, but it just doesn't. If a CEO can't give it to you straight or is just consistently wrong it does erode confidence.
    Oct 11 12:19 PM | 1 Like Like |Link to Comment
  • Pershing Square's Pressure On Air Products Will Bring Valuation In Line With Peers [View article]
    APD has always traded at a discount to its peers because it has historically had lower margins and returns. I bought this stock a little over a year ago around 77 basically on the assumption that they were taking steps to improve margins which should close the multiple gap between them and their peers. In the little over 4 quarters I owned it there was no material improvement in operating performance, but the mulitple gap did close and i sold in the mid 90s. Then the stock popped on the ackman news. I hope he helps them make changes because so far they haven't been able to make them on their own. We'll see if he can help in that regard since his changes aren't always good i.e JCP.
    Sep 16 05:34 PM | 2 Likes Like |Link to Comment
  • Daktronics Displays Shareholder Friendly Practices And Operating Leverage [View article]
    FCF has also been considerably higher than earnings the past few years, which is a metric i like to focus on and which has been the driver for those special dividends
    Aug 19 01:59 PM | Likes Like |Link to Comment
  • Uralkali Stuns The Potash Market: The New Era Begins [View article]
    While this move by Uralakali is negative in the short term it does make all these other players like BHP who were planning on bringing more capacity to the market think twice. It will also likely kill off smaller to medium size players bringing further consolidation over time. This might be a pre-emptive move to kill off planned capacity increases that could end up working in the long run, though it could also just put a ceiling on the price of Potash to ensure other entrants don't come in.
    Jul 31 03:15 PM | 1 Like Like |Link to Comment
  • AIG Is Still At A 35% Discount To Book Value [View article]
    AIG is not a reinsurer they are a primary insurer. Also, a lot of the P&C insurance companies are no longer trading below book. ALL, TRB, CB, and PRG are all above book value. Granted these guys are all doing very well right now and have a higher ROE then AIG. If AIG can get its ROE above 10% there is no reason it shouldn't have a 1x BV. If you look at P&C companies they are around 1.25x book and Life are about .8x book. Given AIG is exposed to both they should command a 1x BV if they keep showing improvement in their P&C business which has been the laggard.
    Jun 28 01:23 PM | 3 Likes Like |Link to Comment
  • Daktronics: Looking Out For Shareholders [View article]
    I assume you are calculating the payout ratio as div/earnings. For DAKT earnings are a little deceptive as they have been artificially depressed due to significant capex that they did in 2007 and 2008 when they were growing like gangbusters. Since the financial crisis they have had to spend significantly less on capex since they had excess capacity. If you look at their free cash flow numbers which I calculate as operating cash flow - capex instead of earnings you will see that over the past 3.5 years they have paid out about $85mm in dividends including special dividends, but have generated about $93mm in FCF, so despite the lower earnings they have genereated more than enough FCF to pay the dividends over the past few years without depleting their significant cash position on the balance sheet
    Jan 11 04:21 PM | Likes Like |Link to Comment
  • Daktronics: Looking Out For Shareholders [View article]
    I love this company as well and its volatility. I have owned on and off since 2010 and the ability to generate significant amounts of FCF is why I was attracted to the company and that has not changed. As long as management focuses on keeping a lid on manufacturing and operating costs in order to meet their margin goals, which they have done the past couple quarters these guys can generate lots of cash and keep paying those juicy special dividends.
    Jan 9 12:03 PM | Likes Like |Link to Comment
  • Bank Of America: Destined To Double In 2013? [View article]
    Book Value for BAC is not the right number to be looking at. With banks you should look at Tangible Book Value and BACs TBV is 13.5 ot .85x well below its BV of 20. Also, why would BAC with all its issues and regulatory oversight go back to 2x TBV anytime soon. Citi is trading at .75x TBV and JPM is only about 1.2x TBV. Only really solid banks that aren't sifis like USB are trading north of 2x TBV
    Dec 18 05:03 PM | 1 Like Like |Link to Comment
  • Buffett Eyes DaVita As A Long-Term Investment [View article]
    They don't pay a dividend. Most of their considerable FCF goes to fund growth either through capex that builds new dialysis centers or towards acquisitions of dialysis centers and most recently the purchase of healthcare partners which is going to allow them to branch out into non-dialysis patient healthcare management. Anything left over generally goes towards share repurchases of which they have been aggressive when they have excess cash.
    Dec 17 11:18 AM | Likes Like |Link to Comment
  • More on H-P: The company is taking an $8.8B charge related to Autonomy just a year after buying it for $10.2B. Some thought a write-down was possible, but few expected one this large. FQ1 guidance is for EPS of $0.68-$0.71, below an $0.85 consensus. Prior FY13 EPS guidance of $3.40-$3.60 is maintained, but there's probably a lot of skepticism. PC sales -14% Y/Y (-10% in FQ3), printing -5% (-3% prior), services -6% (-3% prior), enterprise hardware -9% (-4% prior), software +14% (boosted by Autonomy), financial services +1%. HPQ -10%. CC at 8AM ET (webcast). (PR[View news story]
    They still have 35b of goodwill on their balance sheet, down from 55b and shareholders equity of 22b. Given the track record of bad purchases over the years would anyone be surprised if they took more writedowns in the future of their goodwill. Their D/E is now over 100% and their net debt/equity is close to 80%, not so great.
    Nov 20 03:34 PM | Likes Like |Link to Comment
  • Assurant: Analyzed Using James Montier's Three Risks [View article]
    I have owned assurant for almost 3 years now. The stock is trading at about 60% of TBV and for the past 3 years has returned almost 600mm a year to shareholders via div and buyback, with most of it being buybacks. As mentioned before the lender placed biz has crushed it the past few years. Because of this the regulators have started to say they are overcharging and forcing rate reductions. CA just put through 30% premium reductions on some of their lender placed products and the fear is that this will spread to the other states especially FL which is their largest single state. Everyone knows this biz is going to decrease eventually, but the date of when keeps getting pushed back. While the premiums will go down because of the rate decrease they are still increasing the number of homes they track and placement rates are still pretty high, so instead of normalizing by 2015 as they expected it could be a couple years later and all these extra profits are being used to buy back shares. Currently they are doing about 375-400mm in NOI for the specialty property unit. Based on my calculations the other 3 units should generate about 300mm in NOI and corp expenses are about 60mm. This leaves about 240mm of NOI or about 3/share. Even if you see the specialty biz flat line at half of what it is now that is about 200mm/ year and you are looking at 440mm in NOI or 5.5 of operating EPS per share. With the reduced uncertainty around the specialty biz you should get closer to a 10x multiple and get at least 55. Even if I am wrong a bit on my earnings projections you should still be able to get to 5 EPS and 50 for the stock. Each way you slice it it is super cheap to me and the management team has been good in adapting to new realities in the past.
    Oct 28 05:58 PM | 2 Likes Like |Link to Comment
  • Top 10 Things You Should Know About Iran's Hyperinflation [View article]
    an interesting take on the impact from the devaluation of the rial and how it is not as broad based as other cases of devaluation.
    Oct 9 05:44 PM | Likes Like |Link to Comment
  • Mariano's Is A Breath Of Fresh Air For Roundy's [View article]
    i used to like shopping at Jewel, but most of the stores I have been too since I moved back to Chicago a little over a year ago are just diliapidated. There are still some nice stores, but marianos is a lot nicer shopping experience for someone who wants quality without paying whole foods type prices. It should serve the costco segment of the market pretty well i.e middle upper class. I don't know enough about the pik-n-save business to have a good handle on the stock, but Mariano's so far seems to be a good concept with plenty of room to grow.
    Sep 28 03:28 PM | 1 Like Like |Link to Comment