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  • Apple's Shareholders Expect Too Much [View article]
    You're right. We Apple bulls have pushed AAPL to the astronimically high valuation of 16 TTM P/E. The horror.

    There has been a rash of articles exactly like this one, all with the same premise that Apple has risen too far and must come back down. Their assumption is that AAPL is overvalued right now and must return to fair value. Instead, AAPL was undervalued before and is now at fair value. This is supported by the current TTM P/E of 16, with a forward P/E close to single digits. The earnings outran the price, and the price is playing catchup.

    This is completely different from Microsoft and Cisco during the tech boom when they had outrageous valuations. Apple has a very, very conservative valuation supported by monster earnings. That's why AAPL is different and will continue to show strength.
    Mar 13, 2012. 03:19 PM | 2 Likes Like |Link to Comment
  • Can Babcock Wilcox Change The Game With The Modular Nuclear Reactor? [View article]
    "SMRs construction is not cheaper on the per megawatt basis, but it is at fraction of price for the total cost. We're talking like $XXXM vs $XXB."

    I'm really struggling to believe this. Many of the things that you cite to increase cost savings for SMR's - passive safety, modular construction, COLA licensing process - are currently being deployed by Westinghouse for the AP1000. But they both still have to employ seismic design, separation requirements, 2 over 1, etc. B&W plans to get all this constructed and installed for under $1B? If true, then the company is really on to something. However, I simply don't believe it.

    I'm not threatened by SMR's, as I work for an AE firm. We actually did design work for a competing SMR. If they're cost effective, I have no problem welcoming them to the current fleet. However, I've seen the new AP1000 construction at Vogtle and Summer with my own eyes. I am far more excited about that, as I really think it has the ability to kickstart construction again. If we can get these four new units built on time and budget, we could easily construct another 100 units in this country over 20 years. These are high-paying American jobs creating clean electricity.
    Mar 4, 2012. 09:01 AM | Likes Like |Link to Comment
  • Can Babcock Wilcox Change The Game With The Modular Nuclear Reactor? [View article]
    Out of curiosity, what is the advantage of liquid metal or high-temperature gas reactors? Safety? Change that to PERCEIVED safety. Do you know how many people have died as a direct consequence of a light-water reactor having an accident? I count three people from SL-1. Nothing from TMI-2, nothing from Browns Ferry-1, and nothing from Fukushima (which, again, was literally the worst case scenario). So you have three deaths in 60 years of military and commercial use of LWR's, which currently powers 20% of the nation's electricity, as well as its naval fleet.

    We like water. We're comfortable with it because we've been using it in our process designs for centuries, well before nuclear technology came around. We've tried gas cooling in the past, but we can never get the damn thing running for more than a few weeks at a time. Gas has a funny way of finding every little flaw in a weld, gasket, or joint. Before you know it, you've sprung a leak and need to shut down for repairs.

    The economics just aren't there. LWR technology is so mature and safe that there is not enough advantage to throw billions into new reactor technologies. The closest you'll come is when a government is trying to push a technology for political reasons. The Canadians were shut out from American enriched Uranium fuel, so they developed heavy-water reactors using natural Uranium. Fast forward a few decades to the present, and they've conceded the CANDU design to a LWR. Turns out, producing deuterium is more expensive than enriching Uranium. The Indians have large natural deposits of Thorium and have been shut out from several international sources of Uranium since the 70's. So they're pushing fertile Thorium to create fissile U-233. But it's still a LWR.

    Keep your eyes on Westinghouse. They've been on the forefront of nuclear technology since the Manhattan Project, and their designs have been copied for decades. I've been to their new campus and met their people. Their engineers are, by far, the smartest I've come across.

    Everything else is purely academic. Doctoral candidates have to do their dissertation on something.
    Mar 3, 2012. 06:09 PM | 1 Like Like |Link to Comment
  • Can Babcock Wilcox Change The Game With The Modular Nuclear Reactor? [View article]
    If these reactors really were more economical, they would have been built already. Instead, we have 104 light-water reactors in this country, and about 400 total in the world. We have 60 years of LWR operations under our belt. It kills nobody (even under extreme Fukushima accident scenarios), is cost effective, and has the highest capacity factor of all energy sources.

    Anything that proposes sodium cooling, gas cooling, or alternate moderators is purely academic. It's been done already, and it's inferior to light-water reactors. For more information, research Clinch River, Fermi-1, Peach Bottom-1, and Fort St. Vrain.

    Vogtle getting two AP1000's licensed is huge. Westinghouse is back. Buy Toshiba and hope they spin it off.
    Mar 3, 2012. 04:28 PM | Likes Like |Link to Comment
  • Report: Apple To Unveil An 8GB iPad 2 With The iPad 3 [View article]
    And it shows, since RIMM has been way outperforming AAPL.

    Oh wait.

    Go away, LL. You don't know shit.
    Mar 3, 2012. 09:14 AM | 1 Like Like |Link to Comment
  • Can Babcock Wilcox Change The Game With The Modular Nuclear Reactor? [View article]
    I do believe that the NRC has made the claim that it will be cheaper to license a SMR. However, I (and many in the industry) are skeptical, as the nuclear industry has been burned in the past by the regulator.

    Whether the reactor is 50 MW or 1,500 MW, it still needs a core design that can maintain its geometry in accident scenarios. It needs multiple auxiliary cooling systems with independent power sources. You still need diesel generators, battery backup, and steam-driven auxiliary pumps. Basically, so long as the plant needs to be designed to withstand a seismic event, LOCA, loss of offsite power, and station blackout, the NRC will have to evaluate it just like any other reactor.

    And when the NRC is charging $200/hr for each engineer doing a design verification on each safety-related system, those costs are going to add up. And that's not to mention the fact that this is a first-time evolution for an SMR! That's why I'm skeptical of any licensing cost savings, and why utilities want to build monster nuclear units to get the most return on all that invested capital.
    Mar 3, 2012. 08:16 AM | 3 Likes Like |Link to Comment
  • Can Babcock Wilcox Change The Game With The Modular Nuclear Reactor? [View article]
    I work in the nuclear industry, and I attended a conference about two years ago. One of the speakers was a B&W engineer for mPower. While he seemed knowledgeable, it seemed like the company is counting on the same economics that failed in the 70's. They plan to start with a site with one reactor and turbine train. When that reactor goes operational, they'll use the revenue to build a second reactor and turbine train on site. The utility is encouraged to use this method, up to four reactors, if I recall correctly.

    Two problems. First, whether you build one reactor or thirty, the utility is going to have to get an enormous loan. Especially with the cheap cost of financing, it makes more sense to get a loan to cover the cost of two reactors than to get financing for the first reactor, then rely on that plant to produce as advertised in order to pay for each subsequent reactor. It's riskier than just getting a larger loan at the start. Otherwise, you run the risk of half-constructed nuclear plants getting shut down due to funding sources drying up (our country has about 40 half-built nuclear plants because of this very issue).

    Second, modular reactors simply don't make sense. Whether you're creating a reactor in the US with 50 MW or 1,500 MW, the licensing, engineering, and construction costs are almost the same. If you're going to spend upwards of $8B on a nuclear plant, you'd rather have a colossal unit than a puny one. It's simple economies of scale. This is proven by the economics of reactors in the 90's. Westinghouse created the AP600 and saw little interest. They upgraded it to the AP1000, and presto, utilities began ordering. GE had the same issue with the Simplified Boiling Water Reactor (SBWR) until they upgraded it to the Economic Simplified Boiling Water Reactor (ESBWR).

    I understand that these are mostly developed-economy issues. Modular reactors may find success in places like Galena, Alaska, where fuel prices are outrageous due to seclusion. I've heard arguments for third-world countries that can't accommodate a large reactor on their weak grid, but the applications seem limited, and the costs are high compared to coal or gas in developing areas with limited environmental regulations.

    In summary, even if B&W becomes successful with mPower, they won't see orders for years. I'm very bullish on the nuclear industry, but I think there are better opportunities in constructors and utilities. Regardless, I really enjoyed the article and the insight. Thanks.
    Mar 2, 2012. 11:47 PM | 5 Likes Like |Link to Comment
  • Why I Prefer Berkshire Hathaway To Apple [View article]
    Yes, because diversifying into new businesses is always beneficial. Look how well it turned out for GE and Cisco!

    You guys are clueless and have no idea what built this half-trillion dollar company.
    Mar 2, 2012. 10:55 PM | 1 Like Like |Link to Comment
  • Why I Prefer Berkshire Hathaway To Apple [View article]
    If Apple were such a cyclical company, as you claim, how on earth did they grow so fast during a recession that crippled an entire globe?

    They have a stronger moat than you think.
    Mar 2, 2012. 03:37 PM | 2 Likes Like |Link to Comment
  • With Its P/E Ratio Stabilized, Apple Is Looking At $850 Per Share By 2014 [View article]
    Applying a 15 P/E to AAPL, expected to grow over 50% this year, is cheap. Or you could enjoy these more reasonably-priced companies:
    NFLX at 26 P/E
    AMZN at 131 P/E
    LNKD at 789 P/E
    ZNGA at (NEG) P/E

    You're entitled to your opinion. I'm entitled to mock you.
    Mar 1, 2012. 09:48 AM | 7 Likes Like |Link to Comment
  • Apple Should Pay A Dividend And Split Its Stock [View article]
    "In my mind, a 5-1 split would be reasonable, it would appear to be cheap enough to small retail investors wanting to get into the stock, but expensive enough where they do not appear on the "lower end" of the market."

    "However, by offering no dividend, Apple fails to attract yield and value-chasing funds. If Apple could gain a higher percentage of its float to be institutionally held, it would make the stock less volatile, and more appealing to buy and hold investors."

    These two statements contradict themselves. In one, you encourage a stock split because it'll raise the amount of small investors piling into the stock, increasing share price. In the other, you encourage a dividend because it'll increase the institutional ownership, decreasing volatility.

    You can't have both. Which one do you actually prefer?
    Mar 1, 2012. 09:37 AM | 1 Like Like |Link to Comment
  • Greece's Default Gets Messier [View article]
    >>Makes one think of the great tragedy of the Soviet Union. Just too far ahead of its time.

    Go back to school.
    Feb 29, 2012. 03:21 PM | 1 Like Like |Link to Comment
  • Hewlett Packard Has $20 Written All Over It [View article]
    Where in the hell are you getting a 33.2 P/E for AAPL? The stock is at $516.39 and has TTM EPS of $35.14. Trailing P/E is 14.70.

    Meanwhile, HP is priced at $27.05 and a TTM EPS of $3.32. trailing P/E is 8.15.

    However, let's compare YOY EPS growth over the past four quarters:
    AAPL - 115%, 51%, 121%, 91%
    HPQ - (100%), (89%), 24%, 14%

    With numbers like these, you're going to have a hell of a time convincing me that Apple is overvalued with a P/E under 15 and a growth rate that high. You're a total fool.
    Feb 24, 2012. 07:18 AM | 3 Likes Like |Link to Comment
  • Apple Is Very, Very Cheap At Less Than 9 Times Current Earnings [View article]
    Over $500 today. Pretty soon, we'll get to continue the game of, "Laugh at the AAPL Bears" with DVL. Am I allowed to call him a freaking putz yet, especially since he spoke with such condescension on all who espoused the growth opportunities that still remain with an investment in Apple?

    I'm up over 50% in 8 months with AAPL. This growth rate sucks. Definitely no value here.
    Feb 13, 2012. 10:35 PM | Likes Like |Link to Comment
  • Apple Is Very, Very Cheap At Less Than 9 Times Current Earnings [View article]
    "I have no postion in AAPL one way or the other. It could go to $5,000 per share or $0 and it would mean nothing to me so I don't see how I am "angry"."

    I'd be pretty pissed too if I missed out on this growth.
    Jan 26, 2012. 10:04 AM | 1 Like Like |Link to Comment