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valuestudent

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  • Lululemon Is A Sell And The Insiders Know It [View article]
    I agree with the conclusion that being Short LULU is a better investment risk reward than being long LULU. I am confused on your use of growth expectations in relationship to stock price. So, I will give you my feedback for what it is worth (since you say you are learning)

    I think by framing your argument around growth expectations (28%) in terms of the stock price isn't the best analysis. The growth rate should be used to grow revenues. Then you could hold or change the profitability of the company in future years. This would get you some number. You could then do a DCF model. The most important step would be what do you think a reasonable multiple should be for those earnings. At the current 40+ p/e multiple the market is saying that LULU can continue to grow very fast. However, over time that likely hood should decrease. My argument would be that you shouldn't focus on price appreciation, but rather determine what the value of the business is and then, is your valuation saying that the price is too high.

    Hope that helps.
    Jan 6 08:14 PM | 2 Likes Like |Link to Comment
  • Fishing for Value in Retail - Two Especially Good Picks [View article]
    My problem with retail which isn't addressed in your article, and I would love feedback on has to do with gross margins. You commented that your wife went to the one day sale. Shoppers may only be coming back when companies are offering significant discounts. Are you worried about decreases to gross margins? Thanks.
    Sep 24 10:50 PM | Likes Like |Link to Comment
  • Pounding the Table on U.S. Large Caps [View article]
    The best time to invest is when there is blood in the streets. Warren Buffett just increased his holding in JNJ by 73%. Most managers and retail investors are worried about what is going to happen in the next 6 months, but investing should be about the next 5-10 years.
    Aug 31 11:50 PM | 2 Likes Like |Link to Comment
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