Heads You Win, Tails You Tie With Outdoor Channel [View article]
Thanks for the writeup Chris. I saw this news story yesterday: http://buswk.co/YBUu6C. Can you explain the difference in pricing between TV Guide network and OUTD? Based on CBS's purchase price of half the company it seems to be valued at $3/subscriber. What makes OUTD so much more valuable?
SG&A is relatively inexpensive. Mostly rum, parrot food, and citrus to prevent scurvy. But the business doesn't have much of a moat and a dip in business may result in walking the plank.
"Apple (AAPL) thrived because its CEO was a jack-of-all-trades who stood atop a mountain of experts," writes Bleacher Report founder Bryan Goldberg. "Let's face it -- Was Steve Jobs really an expert in anything? ... Would Tim Cook or Ron Johnson concede that Steve knew supply-chain or retail better than they did?" But Jobs "knew when to listen to each [expert], and when to stop listening to each one." Goldberg sees AOL, which he suspects is "rife with editors, engineers, and salespeople talking past each other," as a company sorely in need of a jack-of-all-trades. [View news story]
Most people I know who had ATT when the iPhone came out would have loved to switch to a different carrier because they weren't happy with the service. I also knew plenty of people who would have gladly bought an iPhone if it were available on their carrier. He did it for the boatload of money ATT gave him for the exclusive, not for the 'experience'. Same reason he refused to license Apple OS like Microsoft did.
"Apple (AAPL) thrived because its CEO was a jack-of-all-trades who stood atop a mountain of experts," writes Bleacher Report founder Bryan Goldberg. "Let's face it -- Was Steve Jobs really an expert in anything? ... Would Tim Cook or Ron Johnson concede that Steve knew supply-chain or retail better than they did?" But Jobs "knew when to listen to each [expert], and when to stop listening to each one." Goldberg sees AOL, which he suspects is "rife with editors, engineers, and salespeople talking past each other," as a company sorely in need of a jack-of-all-trades. [View news story]
Yes Jobs had some great ideas, but he also made some costly mistakes that hurt the company after his death. His decision to be initially exclusive to only AT&T cost Apple millions of subscribers who would have bought an iPhone but bought Android instead. He also insisted that his iPhone was perfect and anyone who wanted a bigger screen or a cheaper phone could could get lost.
Jobs almost destroyed Apple in the 80's by insisting on controlling the hardware and lost out to Microsoft who licensed their software.
Are the other major shareholders insiders as well? According to the article below major shareholders include Kinderhook Partners, James T Martin (Private Investor), Baker Street Capital, and Khrom Investments. Are these entities related to Comvest and/or AUTO executives?
I was using adjusted EPS (which basically takes out the stock compensation) vs. reported EPS, so I guess you have to come to your own conclusion what you want to base it on.
It doesn't make much sense to me to use trailing EPS, especially for a company that's growing so fast. If you had a growing company priced at $1 and the past EPS went from -.20 EPS the prior year to .01 EPS in the current year would you say it's trading at 100X PE so it's just way to expensive? Analyst estimates may not always be right, but they aren't based on nothing (usually). In IMAX's case we know they are rapidly expanding their theatre count, so are you not going to give them any credit for that?
I think the company has reached an inflection point. The joint venture model is doing very well and they are long term (10 years). Backlog remains strong. Free Cash flow is also strong and should be a lot more stable compared to previous years (I've run some discounted cash flow models and it does not look expensive based on my calculations).
In any case I do agree that the company has good long term potential.
I always hate to read and respond to a bad article giving the author his 2 cents or whatever he gets for writing it, but for the benefit of people who are reading your article I thought it prudent to point out many of your misstatements.
1. Yes it's true. Last year management guided to 3.02 - 3.16, above analyst expectations. They then proceeded to crush those estimates and ended up at 3.55 for the year. So I don't think they generally give 'rosier guidance'. In fact they typically give conservative guidance.
2. You twisted what Credit Suisse said from a question into a statement ("Hey, things are going to be a little bit slower that we'll be more conservative for 2013"). BTW - Here is what Credit Suisse says in their new analyst report today "The bottom line after analyzing Q4 results and listening to last night’s conference call is that we believe that PETM is one of the more intriguing growth stories in our space. As we have seen before, sometimes due to misunderstandings or misperceptions, there are good opportunities to own great companies at attractive prices. That seems to be the case with PETM as the market appears to be overreacting (based on last night’s aftermarket sell-off) to guidance that in our view seems reasonable and exceedable." They mantained their $78 price target. They don't seem to pessimistic to me.
3. You also said management spoke of weaker traffic in the quarter. In fact what they said is it started off slow and has picked up every week since then. The analyst even said "Okay, that's helpful. That sounds very familiar to actually a number of retailers. ".
4. In your other article you said Operating Margins might start to decline. They haven't. They were up 120 basis points on the quarter and 100 basis points Y/Y. They are guiding for flat to slightly up for 2013.
For 1st Q they guided their high end above analyst expectations. You might also want to note that with the planned management transition after the next quarter they are likely being extremely cautious in their guidance. They also mentioned that they achieved overall profitability in their Pets Hotels business. Another sign contrary to what you say that their high margin service businesses don't have much room to run. In addition to opening 45-50 full size stores they will also be opening 12 'micro' stores (around 6 - 7.5k sq. ft) which will have less SKU's but have the other services like grooming, pet training, and adoptions.
You also mention in your other article that due to the payroll tax reversion people are probably trading down to stores like Walmart, Target, etc. I doubt that's true, but it certainly wouldn't explain why people continue to trade up to Premium and Super Premium foods at Petsmart. Also if anyone believes that the economy is in a recovery phase and not heading back to recession, Petsmart is a great way to play a job and housing recovery (management even alluded to being helped by higher housing sales).
So anyway, this will be my first and last post on this article, but I just thought I'd give those reading it the other side of the story (also the story that doesn't contain statement taken out of context by the author).
Domino's Pizza (DPZ) says it opened its first store in Thailand as growth in Asia remains a focus. The company is an under-the-rader global growth bet with half of its sales and a third of its profits now generate outside of the U.S. [View news story]
I don't think it's "under-the-rader" or even under-the-radar for that matter.
Verizon (VZ +0.9%) is bent on taking full control of Verizon Wireless this year, and has even discussed merging with Vodafone (VOD +3.9%) to achieve this goal, Bloomberg reports. Merger talks are said to have stalled over "disagreements on leadership and headquarters location," thus making a buyout or partial sale of Vodafone's 45% stake (estimated to be worth $115B) more likely. One source claims Vodafone is open to using the proceeds to make European acquisitions. (previous) [View news story]
I'd love a merger. That said anything to unlock some value in VOD would be nice. As much as it's up today I'm still down 1% from where I bought it. I still think it is trading at a 20 - 25% discount from where it should be.
How To Pick REIT Stocks Like Trump And Think Like Graham [View article]
Heads You Win, Tails You Tie With Outdoor Channel [View article]
Gregg
Safe At Sea, Legal In Port [View instapost]
"Apple (AAPL) thrived because its CEO was a jack-of-all-trades who stood atop a mountain of experts," writes Bleacher Report founder Bryan Goldberg. "Let's face it -- Was Steve Jobs really an expert in anything? ... Would Tim Cook or Ron Johnson concede that Steve knew supply-chain or retail better than they did?" But Jobs "knew when to listen to each [expert], and when to stop listening to each one." Goldberg sees AOL, which he suspects is "rife with editors, engineers, and salespeople talking past each other," as a company sorely in need of a jack-of-all-trades. [View news story]
2013: Long And Short Of It [View instapost]
"Apple (AAPL) thrived because its CEO was a jack-of-all-trades who stood atop a mountain of experts," writes Bleacher Report founder Bryan Goldberg. "Let's face it -- Was Steve Jobs really an expert in anything? ... Would Tim Cook or Ron Johnson concede that Steve knew supply-chain or retail better than they did?" But Jobs "knew when to listen to each [expert], and when to stop listening to each one." Goldberg sees AOL, which he suspects is "rife with editors, engineers, and salespeople talking past each other," as a company sorely in need of a jack-of-all-trades. [View news story]
Jobs almost destroyed Apple in the 80's by insisting on controlling the hardware and lost out to Microsoft who licensed their software.
AUTO: $0.01 Down Versus $1.00 Up [View instapost]
http://seekingalpha.co...
AUTO: $0.01 Down Versus $1.00 Up [View instapost]
Rangeley Capital Q&A [View instapost]
Do you ever invest on foreign exchanges?
Thanks,
Gregg
IMAX: Can It Rise Further? [View article]
It doesn't make much sense to me to use trailing EPS, especially for a company that's growing so fast. If you had a growing company priced at $1 and the past EPS went from -.20 EPS the prior year to .01 EPS in the current year would you say it's trading at 100X PE so it's just way to expensive? Analyst estimates may not always be right, but they aren't based on nothing (usually). In IMAX's case we know they are rapidly expanding their theatre count, so are you not going to give them any credit for that?
I think the company has reached an inflection point. The joint venture model is doing very well and they are long term (10 years). Backlog remains strong. Free Cash flow is also strong and should be a lot more stable compared to previous years (I've run some discounted cash flow models and it does not look expensive based on my calculations).
In any case I do agree that the company has good long term potential.
IMAX: Can It Rise Further? [View article]
IMAX: Can It Rise Further? [View article]
PetSmart's Earnings: Oops [View article]
1. Yes it's true. Last year management guided to 3.02 - 3.16, above analyst expectations. They then proceeded to crush those estimates and ended up at 3.55 for the year. So I don't think they generally give 'rosier guidance'. In fact they typically give conservative guidance.
2. You twisted what Credit Suisse said from a question into a statement ("Hey, things are going to be a little bit slower that we'll be more conservative for 2013"). BTW - Here is what Credit Suisse says in their new analyst report today "The bottom line after analyzing Q4 results and listening to last night’s conference call is that we believe that PETM is one of the more intriguing growth stories in our space. As we have seen before, sometimes due to misunderstandings or misperceptions, there are good opportunities to own great companies at attractive prices. That seems to be the case with PETM as the market appears to be overreacting (based on last night’s aftermarket sell-off) to guidance that in our
view seems reasonable and exceedable." They mantained their $78 price target. They don't seem to pessimistic to me.
3. You also said management spoke of weaker traffic in the quarter. In fact what they said is it started off slow and has picked up every week since then. The analyst even said "Okay, that's helpful. That sounds very familiar to actually a number of retailers. ".
4. In your other article you said Operating Margins might start to decline. They haven't. They were up 120 basis points on the quarter and 100 basis points Y/Y. They are guiding for flat to slightly up for 2013.
For 1st Q they guided their high end above analyst expectations. You might also want to note that with the planned management transition after the next quarter they are likely being extremely cautious in their guidance. They also mentioned that they achieved overall profitability in their Pets Hotels business. Another sign contrary to what you say that their high margin service businesses don't have much room to run. In addition to opening 45-50 full size stores they will also be opening 12 'micro' stores (around 6 - 7.5k sq. ft) which will have less SKU's but have the other services like grooming, pet training, and adoptions.
You also mention in your other article that due to the payroll tax reversion people are probably trading down to stores like Walmart, Target, etc. I doubt that's true, but it certainly wouldn't explain why people continue to trade up to Premium and Super Premium foods at Petsmart. Also if anyone believes that the economy is in a recovery phase and not heading back to recession, Petsmart is a great way to play a job and housing recovery (management even alluded to being helped by higher housing sales).
So anyway, this will be my first and last post on this article, but I just thought I'd give those reading it the other side of the story (also the story that doesn't contain statement taken out of context by the author).
Domino's Pizza (DPZ) says it opened its first store in Thailand as growth in Asia remains a focus. The company is an under-the-rader global growth bet with half of its sales and a third of its profits now generate outside of the U.S. [View news story]
Verizon (VZ +0.9%) is bent on taking full control of Verizon Wireless this year, and has even discussed merging with Vodafone (VOD +3.9%) to achieve this goal, Bloomberg reports. Merger talks are said to have stalled over "disagreements on leadership and headquarters location," thus making a buyout or partial sale of Vodafone's 45% stake (estimated to be worth $115B) more likely. One source claims Vodafone is open to using the proceeds to make European acquisitions. (previous) [View news story]