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  • Herbalife Responds to Misleading and Inaccurate Information 
    Is 188 complaints over 7 years against a multinational company a statistically significant number? Can someone with more knowledge of how many complaints the FTC typically receive perhaps cast more light on this?
    It does seem that there are a LOT of flighty investors though, given the trading volumes ...

    Am currently long HLF, purely on risk-reward assessment.
    Feb 4, 2013. 02:21 PM | Likes Like
  • Apple: Why Earnings Will Grow Less Than Analysts Expect  [View article]
    Good analytical work. In future, might I suggest you include sensitivities. That helps you gauge the degree of your conviction, and provide readers a way to pick their estimates depending on their assumptions. Not too hard to do once you create the base template, I reckon. What Apple needs is to do more. and do them even better, in a world that is getting more competitive, and growing more slowly. Not easy. But valuations ex cash are in the low-teens. It suggests that most investors (ie not the in-out traders) are not nearly as gung-ho as the 20+% long term growth estimates promoted by analysts.
    Sep 28, 2012. 11:18 PM | Likes Like |Link to Comment
  • The most over-owned stocks at the top 50 mutual funds are GOOG, MSFT, T, AMZN, and HD, according to a Citigroup report. The most under-owned: CSCO and WMT. (h/t tradefast[View news story]
    One way the analysts would measure over/under owned would be to take the total ownership divided by benchmark weight.
    It would probably be technically clearer if the analyst used the word OVERWEIGHT or UNDERWEIGHT.
    But it would not be as "headline grabbing".
    The question that needs asking is whether these 50 mutual funds are the "smart" money or have they been lagging the market anyway?
    Sep 20, 2012. 09:08 AM | 3 Likes Like |Link to Comment
  • Another Look at Euro Area Capital Flight  [View article]
    Perhaps writing down on unsecured debt is legal and appropriate for a FAILED bank, but not a FAILING bank ... yet?
    Jun 12, 2012. 12:12 PM | Likes Like |Link to Comment
  • Another Look at Euro Area Capital Flight  [View article]
    Don't worry about the US. It's too big to fail. ..
    Well, sorta ...
    Jun 12, 2012. 12:08 PM | Likes Like |Link to Comment
  • The Dividend Investors' Guide - Part VII: Beverages, How Much Can The World Swallow?  [View article]
    Just took a quick look at ABV, the stock mentioned.
    Stock is valued as a growth stock (over 7x Book, over 20x Earnings). Justification comes from its high ROE (over 30%) and perceived industry nature.
    Dividends are generous, but due to the high ROE, its Div yield is under 2% now.
    Main caution is that analysts' estimates have been coming off over the last 60 days - a big negative for stocks that are priced off growth.
    Jun 8, 2012. 03:55 AM | 1 Like Like |Link to Comment
  • No To Apple Dividends  [View article]
    Some companies need cash to reinvest in the biz to grow. That's due to the working capital needs. Some companies don't. You fail to see which camp Apple is in.
    May 27, 2012. 04:45 AM | 18 Likes Like |Link to Comment
  • Why I Became A Netflix Bull  [View article]
    I am currently short Netflix shares. However, after reading the flurry of negative rebuttals to this positive spin (which my biased opinion concurs seem based on unverifiable, positively skewed, assumptions and extrapolations), I should perhaps reconsider.

    I was actually hoping there were more optimists actually. Oh well.
    Mar 18, 2012. 04:11 AM | Likes Like |Link to Comment
  • More Data Points on China Real Estate  [View article]
    In the long term, the Chinese real estate market continues to be supported by rising wages. In the short term, the government agenda to withdraw funds from real estate will deflate the bubble. High vacancy rates don't affect investors who have near infinite holding power 'coz they bought with cash and have other income streams.

    Until there is a more compelling alternative investment for China's wealthy to redirect their savings into, real estate prices in the prime locations will continue to be supported. But of course it is in EVERYONE's interest to let the real estate prices deflate a bit first. Even the developers know better than to openly defy Beijing's edicts. Step back and let the real estate indices reflect a mild teens decline so that Beijing saves a bit of face. Then they can nudge it up again.
    Jul 25, 2010. 02:25 PM | Likes Like |Link to Comment
  • Karl Denninger looks at Goldman Sachs' (GS) re-reversal on the euro and says listening to the bank has been a great way to lose money.   [View news story]
    A lot of people got the Euro call wrong. Just ignore them and read the charts yourself. It took me a while ... but I'm finally making some change on the US-Euro trades..
    Jul 15, 2010. 01:24 PM | 3 Likes Like |Link to Comment
  • China Yuchai International - 1st Q Revenues should blow away historical bests  [View instapost]
    from the results transcript, the most worrying issue he mentioned was build-up of inventory in the channels. We will know soon enough I guess. I will add to positions if shares fall further.... Risk-reward favors holding regardless of how terrible the US or Europe does as far as I can tell.
    May 24, 2010. 12:40 PM | Likes Like |Link to Comment
  • Understanding the Bear Case  [View article]
    I too am bearish, but "the market can stay illogical longer than you can stay liquid" ... to paraphrase a famous guru.

    I'd wait till some of the key levels are broken before going short.
    And btw, if you adjust for the financials, the PE levels on the market really doesn't look all that expensive.. But therein lies the problem.

    Markets collapsing will cause earnings to breakdown for the banks. Markets rising will improve earnings for the banks... Its one of those inexplicable self-fulfilling prophecies with that chart at this point.
    May 24, 2010. 10:48 AM | Likes Like |Link to Comment
  • China Yuchai International - 1st Q Revenues should blow away historical bests  [View instapost]
    so why did the share price crash after results?
    I remain puzzled..
    May 13, 2010. 04:12 PM | Likes Like |Link to Comment
  • Barron's Andrew Bary says Wall Street's reaction to the Goldman Sachs (GS) fraud charges is overblown. "Patient buyers of Goldman stock probably will come out ahead, given the company's low valuation and the likelihood that even a defeat at the hands of the SEC probably will be financially tolerable."   [View news story]
    The information coming out does suggest that the SEC has a lot more than just the single email that has been widely quoted. See some news articles (e.g. www.telegraph.co.uk/fi...) which gives more detail behind how Paulson played a key role in selecting the assets that went into the Abacus CDO. If the SEC proves this, and since the Abacus document suggests that the selection was made by an independent committee, then it is a clear case of fraud.
    With GS choosing to defend, the case will just escalate.
    For now, debating the true fundamental valuation for GS seems pointless.
    The newsflow is likely to remain nasty, especially with UK and Germany getting into this and the politicians in US and London needing to show they are doing something substantive.
    We will know if fundamentals can buoy the stock after we see the price action post the upcoming results. I doubt it.
    I can't think of many analysts who would have a BUY rating on GS after results. Why should they when they can use one of a hundred excuses to demurr?

    ... so if news momentum is likely to be negative and momentum players likely to go short on the stock, where is the countervailing BUYing pressure potentially going to come from? Value investors? Hmmm... and when would Warren Buffet add more? [I can't imagine this happening ahead of resolution for the case] Most value investors I know won't consider a stock with pending fraud litigation with unclear repercussions on its core business.
    I must state for the record that I decided to short GS after the announcement while adding to others which were sold off in the downdraft. But unlikely some commentators here, I really don't see GS going anywhere near zero. There are certainly many bright people running strong franchises in this group, and these should be worth something... I guess.
    Apr 18, 2010. 02:37 PM | Likes Like |Link to Comment
  • Feb. ISM Non-Manufacturing Index: 53 vs. 51 expected and 50.5 prior (>50 denotes expansion). Prices index fell to 60.4 from 61.2. Employment rose to 48.6 from 44.6. New orders rose to 55 from 54.7.   [View news story]
    All eyes are focussed on Friday's Employment data release. As highlighted by bbro, the employment section is worrying. 9 industries reported reduction while 2 reported improvement. Of those 9, Educational Services and Health Care etc should be watched since these were where there was actually employment growth in the last year. The big unknowable is manufacturing where a lot of jobs have been lost in this recent downturn. Perhaps Friday's release will see improvement here. Who knows.
    Mar 3, 2010. 10:24 AM | Likes Like |Link to Comment