The Bear Who Cried Wolf: Everything Is Fine Until It Isn't [View article]
Great article. I enjoy reading your work. You posed the conundrum about a rising stock market in 2012 in the face of outflows from equity mutual funds and ETFs with the implication that the culprit is repo-funded security purchases by large financial institutions. This may be part of the explanation but you are ignoring another key factor which is share repurchases by corporations. Companies have funded large buyback programs not only from current cash flows, but also from taking on debt at record low rates. To a much lesser extent, private equity purchases of public companies is another mechanism for fund flows into equities that is not captured by the sources you cited. Corporations are notoriously bad at timing share repurchases with the most recent evidence found in the massive levered recaps that were occurring in 2006-7 so perhaps they are erring again now, which would support your bearish stance, which I happen to share.
The War Over Amarin: Feuerstein Battles Heisenberg And How I'd Invest It [View article]
Regarding the F-R "Rule", the market cap of a company is simply a reflection of how the sum of all market participants view its value. While I am not a proponent of the efficient market theory in the broader sense, the F-R "rule" may have identified a small pocket of the market (oncology focused biotech companies) to which it applies. That is to say that the market is particularly skilled at handicapping the likelihood of approval and it is already priced into the stocks. I'm not sure why this would be the case for cancer drugs and not other diseases though. In any case, the company that breaks the "rule" will most likely be one where their drug candidate is addressing either a very small indication or is entering a crowded marketplace with a well entrenched standard of care such that expected market share is small. I would imagine that the recent trend of leniency by the FDA in their approval process will contribute to an increasing number of exceptions to the "rule".
Why Venture Capital And Insiders Are Buying Glu Mobile [View article]
Interestingly, Francisco Partners, a $7 Billion San Francisco based technology focused private equity fund filed a 600,000 share stake in GLUU today. Things are starting to become a lot more clear...
Why Venture Capital And Insiders Are Buying Glu Mobile [View article]
Listen to the earnings call (or read the transcript) and I think you will come away with the thought that their 2013 guidance is hyper-conservative. I think you have a string of earnings beats and number raises to look forward to. That in addition to whatever it is that Hany Nada is hatching, and I think GLUU is probably a reasonable bet here.
Why Venture Capital And Insiders Are Buying Glu Mobile [View article]
Your math is off in that first table. The share total is 3,338,127 not 3,297,717. Also, rather than calculating a simple average of the prices, it makes more sense to do a weighted average which yields $3.03 rather than $2.65. Both of these corrections actually make your overall argument (which I agree with) more compelling.
Thanks for your analysis. It is interesting to note that following the last earnings blowup in November, 5 different officers/directors bought a combined $674,000 of stock at a weighted average price of $12.56. No insider has sold below $17.52, which more or less dovetails with your valuation. One way to play this would be to sell the Feb $13 puts for $0.35. If it goes below $13, you own the stock at $12.65, close to where the insiders bought. If it rallies, then you make 2.7% (25% annualized).
Tilly's: Retailer With A Broken IPO Is A Double [View article]
Heissej80, I assume you are aware of the irony when you call into question the qualifications of the individuals making comments here and then add nothing of value yourself. As far I as I can see, your only point (aside from generally agreeing with the author's analysis), is that the company "has to" put up strong results to win back investor confidence. Wow, what an insight!!! Oh, I forgot you also mentioned that they are presenting at ICR, something easily gleaned from a cursory look at the current headlines on yahoo finance. If you are going to take the time to descend from on high to cast some pearls of wisdom before us lowly commenters, why not say something of value? Interesting that you don't provide anything about your own background in your profile...
Tilly's: Retailer With A Broken IPO Is A Double [View article]
Thanks for the detailed analysis. I agree that the risk/reward is compelling, especially if you pair the stock against a broader retail index to control for the risk of an overall drop in consumer spending this year. Do you have any insight into the selling plans for the 2 founders? They still own very large stakes and appear to be consistent sellers. I certainly don't begrudge them cashing out to some extent but the optics of their selling isn't great, and practically speaking, they can pressure the stock during the selling windows. For example, from 11/29 to 12/5 Tilly Levine sold ~300,000 shares which accounted for over a third of the volume during the time frame. While it is good in some ways to have insiders with a lot of skin in the game, it also acts as a headwind to some extent. Are you aware of any public commentary Levine and Shaked have made about their disposition plans? Thanks.
The Bear Who Cried Wolf: Everything Is Fine Until It Isn't [View article]
The War Over Amarin: Feuerstein Battles Heisenberg And How I'd Invest It [View article]
Why Venture Capital And Insiders Are Buying Glu Mobile [View article]
Why Venture Capital And Insiders Are Buying Glu Mobile [View article]
Why Venture Capital And Insiders Are Buying Glu Mobile [View article]
A New North American Shale Oil Champion [View article]
A New North American Shale Oil Champion [View article]
Thanks
Is Western Union A Value Trap? [View article]
Tilly's: Retailer With A Broken IPO Is A Double [View article]
I assume you are aware of the irony when you call into question the qualifications of the individuals making comments here and then add nothing of value yourself. As far I as I can see, your only point (aside from generally agreeing with the author's analysis), is that the company "has to" put up strong results to win back investor confidence. Wow, what an insight!!! Oh, I forgot you also mentioned that they are presenting at ICR, something easily gleaned from a cursory look at the current headlines on yahoo finance. If you are going to take the time to descend from on high to cast some pearls of wisdom before us lowly commenters, why not say something of value? Interesting that you don't provide anything about your own background in your profile...
Tilly's: Retailer With A Broken IPO Is A Double [View article]