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Gettin'Long

Gettin'Long
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  • Why Twitter Is Borderline Cheap [View article]
    GOOG at 6x sales and a PEG of 1.5 is no bargain either, especially considering it's a $400B market cap now. I wouldn't dare short GOOG but it could easily drop 30%-40% if the rev growth slows or margins shrink, which I view as real possibilities for a mega cap. Everybody understands cheaply priced stocks right now are almost nonexistent...and the more people try and justify these lofty valuations the more I raise cash. If TWTR executes perfectly over the next five years you could see a double at best, and that's assuming money keeps flowing into US stocks.
    Aug 22 07:59 AM | Likes Like |Link to Comment
  • Why Twitter Is Borderline Cheap [View article]
    Stone Fox,

    If you are going to look at PEG using 100% growth, yes, it could look somewhat cheap.
    But I've always felt that the PEG is more accurate when assessing a long term or terminal growth rate, not a Twitter type curve. It would have to double sales for the next four years to get around a 1.5 P/S and it would have to double earnings the next three years to get to a P/E of 15 approximately with no dilution or appreciation in the stock price. If it can do that we might look back and call it cheap. But if those doubles turn into 50% growth or 20% growth, the valuations become very, very expensive in a hurry. Will be fun to watch.
    Aug 21 12:50 PM | 1 Like Like |Link to Comment
  • Independent Ad Tech Opportunities With Extremely Negative Market Sentiment [View article]
    Or when the market decides undercutting all your competitors' pricing isn't a valid business model forever. That space is becoming increasingly competitive...the only way WDAY doesn't dive is if it captures nearly its entire addressable market and can charge a premium for its product, which I think has a probability of nearly zero.
    Aug 21 08:59 AM | Likes Like |Link to Comment
  • Independent Ad Tech Opportunities With Extremely Negative Market Sentiment [View article]
    You've been pounding the table on YUME now for a while Charles...I think it's time to jump in. Also short WDAY with you, looking for low 90s to add. The complacency is off the charts and WDAY along with Z and TWTR will be the first ones to crumble.
    If the economy were to really stall, I'm assuming you would see companies pull back on internet advertising and YUME would get hurt? Also, it seems there are quite a few companies in the sector, do you think margin compression is behind the company as proven in the recent quarter or do you think this is possible as the space becomes increasingly competitive? Thank you sir, really enjoy your bold contrarianism and expertise.
    Aug 20 05:45 PM | Likes Like |Link to Comment
  • GLD: Bigger Moves Are Coming [View article]
    Thank you for the update. I took the dip down to 123.50 to dump my toxic JDST position. Will be looking at the action around your targets.
    Aug 11 07:53 AM | 2 Likes Like |Link to Comment
  • Why Cheniere Energy's Stock Should Explode Upward [View article]
    The likelihood everybody else's gas goes to $8-$10 is magnitudes greater than our gas going to $8.
    You have to remember, the US is the only country to have a widespread adoption of drilling unconventional wells and completing with frack technology. The world won't sit there and watch us pump $4 gas forever. I'd guess almost every country in the world could have reasonably priced ($6-$8) gas if they embraced new drilling and completion methods.
    Aug 10 11:20 AM | Likes Like |Link to Comment
  • Are Americans Saving Too Little? [View article]
    I wouldn't call it "betrayal by government" as much as a "lack of accounting competency via unrealistic predictions of future growth and return"
    Aug 9 12:17 PM | 3 Likes Like |Link to Comment
  • Are Americans Saving Too Little? [View article]
    Agreed Lucium,

    In this calculation, if you could assign a payout probability for the SS benefits and other "automated" savings programs sponsored by our fine USA government, that might give a more accurate picture. For example, I'm in my twenties and do not count any government assistance into my retirement calculations...there's no guarantee anything will be there especially for a high net worth individual. This may be pessimistic, but something like only realizing 50% of SS tax benefits for the "average" American might be more indicative of the future. So let's call it a 17.5% savings rate. Not good.
    Aug 9 11:44 AM | 1 Like Like |Link to Comment
  • Barron's hangs a "For Sale" sign on Zillow and Trulia [View news story]
    When the market decides again making money is important, 50% downside from here will still be a good exit price. Real estate itself is inherently a fragmented, local business comprised of thousands of individual agents. Sure, there are teams, but it's still a game of commissions. So long as real estate agents remain financially independent, Z's advertising and sales costs will rise almost lock step with revenue.
    Aug 9 10:23 AM | 3 Likes Like |Link to Comment
  • Arcos Dorados Is Too Risky To Be A Worthwhile Investment [View article]
    I always thought it was a nice pick for peer execution outperformance, but now this position requires a little more attention. Long term I believe in LA, just may take a while. I hate the term "out years", but this is my pick based on the out years. Maybe I'm dreaming, but high single digit organic growth and eventually increasing total stores by a few multiples with reinvested dividends could turn $10k into a nice house over the next 40 years. It does look expensive now though, and it could look really expensive in a year or two if the currency issues persist.
    Aug 7 07:37 PM | 2 Likes Like |Link to Comment
  • Merger Provides No Upside For Zillow At Current Valuation [View article]
    I've got to say, reading the CC had me a little scared being short. But there were a few interesting storylines I thought stood out:
    1) 20+% ARPU growth via the PALS program and other initiatives. Unless a handful of realty firms take over the majority of the market via Zillow, I have to believe that growth number will slow down. And when this happens, it will take more sales/advertising to generate revenue via smaller accounts...
    2) The costs rose almost as fast as the revenues. If they can't break the cycle, they will be broke instead. They maintained guidance, so if this company doesn't make money next quarter they lose all credibility.
    3) It seemed they mentioned the $1 million dollars in unforecasted sales bonuses multiple times, but never mentioned the $8 million in stock based compensation.
    4) It was a really good quarter including upped guidance for H2, but the stock went nowhere, which is encouraging for a valuation short thesis.
    Long term prediction is the same, this company will never make enough money to justify half the current valuation.
    Aug 7 12:14 PM | 2 Likes Like |Link to Comment
  • Greed Misguides - I Said Sell Stocks [View article]
    I think this will be the time it's more than a 5% dip, because it feels like this is the most innocent correction in a while. This market is completely irrational, so I'm betting against my first instinct, which right now is to buy. Selling may be overdoing it though just for a 10% correction, 20% is a different story.
    Aug 6 03:54 PM | Likes Like |Link to Comment
  • Tech Bubble 2.0 - Prem Watsa's List Of Social Media Stocks To Avoid Or Short [View article]
    Relative valuations is a loser's game when talking about 25x sales. Pure bubble mentality and thought process. The only time these valuations have been justified is when the company has changed the world...I'm betting a lot Twitter doesn't
    Aug 5 03:51 PM | 5 Likes Like |Link to Comment
  • Tech Bubble 2.0 - Prem Watsa's List Of Social Media Stocks To Avoid Or Short [View article]
    The rule of thumb has been around 25x sales before a stock stagnates and has a tough time going higher. Currently short $Z, $WDAY and $TWTR. Not easy but they're almost surefire 50% drops over the next year if you can cost average into them and continue to sleep at night.
    Aug 5 03:37 PM | Likes Like |Link to Comment
  • Here's Why Investors Are So Excited About Zillow [View article]
    Most people understand the story...the problem is that you're paying full price today for flawless execution over the next decade. You couldn't find the margin of safety with the Hubble Telescope.
    Aug 5 11:21 AM | 5 Likes Like |Link to Comment
COMMENTS STATS
167 Comments
289 Likes