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  • Ford Motor: Thank You, Dear Mr. Market, I'll Gladly Buy More When You Are Scared [View article]
    Now my biggest position. F shares under $15 are a gift. There is no rationale analysis that justifies the price action of the stock. Yes, sales and earnings have taken a breath in recent quarters - but that was right in line with company guidance. The company KNOWS what is actually happening and has it's finger on the business. Dispise extreme misses or beats (from company guidance.) With almost 4% dividend and positve expectations, F should be in the 20's next year.
    Oct 28, 2014. 03:40 PM | 3 Likes Like |Link to Comment
  • Here's Why Investors Are So Excited About Zillow [View article]
    Good article and observations Mr. Drogen. Built a large position while watching naysayers posts seeing negatives (and doom) over the last 18 months - when the stock was $32.50. While they may have some basis in their fundamental analysis (the technicals have remained bullish), I've watched my Schwab rating go to a 98 or 99 negative recommendation (out of 100.)

    What everyone does not take into account is the third leg of investment analysis. I learned this the hard way while in training in the early 1970's at an intense Merrill Lynch training program in New York, along with brilliant graduate financial professors at NYU. That leg is called "emotion" or "sentiment." The rule has been:

    If you act right and the sentiment is right (and with you), you will be right.
    If you act right and the sentiment is wrong (and against you), you will be wrong.
    If you act wrong and the sentiment is right (and against you), you will be wrong.
    If you act wrong (and know it), and the sentiment is wrong (and with you), you will be right.

    Clearly, even with the large outstanding open short position and insider selling, the Institutions see this stock as having great future potential and may be a game changer in the industry. Institutional sentiment - that's what counts - is with Z.

    See my past posts over the last 18 months. See the naysayers posts recommending shorting or selling the stock. Reminds me of Priceline when it was in the 40's. Insiders selling; P/E infinite/future uncertain. The institutions sentiment, however, was with the stock. Now well over 1200.

    This theory actually applies to stock groups as well. It is wise to watch market sentiment during rotation and balancing.
    Aug 5, 2014. 12:16 PM | Likes Like |Link to Comment
  • Zillow Tells The Market Not To Go Crazy Thinking About Valuations On Trulia Deal [View article]
    Good analysis. Very logical. But the float is thin on Z. Institutions are staying put. Shorts are hanging on. (Some squeeze but not the big one yet.) So "the stock market" and "common sense market" is oxymoronic. The expectations and emotions of the small investor will continue to inflate Z.

    I am lucky enough to be in, beginning last year (beginning in the 30's.) I've thinned my position in half to 1,000 shares. And am struggling with buying some puts as insurance. To all shorts, I have in many previous posts and still urge using options as insurance against risk. Learned long ago (sadly, by experience) that the first rule of investing is, AVOID CATASTROPHE!
    Jul 30, 2014. 09:56 AM | Likes Like |Link to Comment
  • General Electric's Game-Changing Fuel Cell May Spark A Revolution [View article]
    Excellent article. Thank you for putting the technology in language a layman can understand.
    Jul 29, 2014. 10:35 AM | Likes Like |Link to Comment
  • The Zillow Short Instruction Manual [View article]
    Yep, we get it Surbiton! Since late 2012, you have only 94 posts - all 94 complaining about Zillow's 17% of their estimates being 25% wrong. And they have violated your 1st Amendment rights under the Constitution, because they refused to "revalue" your home. Your advice over these 18+ months has been to avoid, sell, or short the stock.

    Obsessive? Compulsive? Paid? (The 1st Amendments gives me the right to have an opinion too. I am formally complaining to a Seeking Alpha.)

    I respect all those posts that point out Z's fundamental and technical flaws, their insider selling, unrealistic valuation, and high P/E relative to their peers. That criticism is usually backed up with charts, graphs, and rational commentary and I respect that. SA is a great forum for this kind of debate. But your personal vendetta because you think they undervalued your home two years ago 94 times is over the top. I remain long Z. (May be personally wrong, but am ahead . . . ahem, substantially to date.)
    Jul 26, 2014. 10:53 AM | 1 Like Like |Link to Comment
  • The Zillow Short Instruction Manual [View article]
    There are millions of homes in the US, and it would be almost impossible for one company to provide exact professional estimates for each home. Zillow (and I assume others, Redfin,, Trulia) uses an algorithm that takes into account market square foot cost comparables (sales and listings) in a given radius area. A home may be influenced by being on a neighborhood perimeter. It may not take into account recent remodeling, landscaping, upgraded roofing (such as tile versus asphalt.)

    Not unlike the old MLS systems in certain communities that coded "home equivalent value" numbers in their books, it was impossible to get it 100% right. Z does an admirable job, and have become the go-to resource for many real estate agents. I used to provide sales promotion work for the 5th largest real estate company in the US, based in the Southeast. Many of their top agents alerted me to Zillow early last year, and I began building my position based on their positive feelings.

    Frankly, it amazes me when someone (neither long nor short Z) seems to be irate by their underestimated valuation of their property. Like the old MLS, they have clear disclaimers, and call the values ZESTIMATES - not ESTIMATES. But as Harvard law professor, Alan Dershowitz, used to say, "Anyone can sue a ham sandwich." This moron should take up cross-stitch or weaving, or better still take Xanex or Lithium and cool off. Maybe you are overvaluing your home!

    I'm glad I followed industry professionals advice and built a solid Z long position. I urged others who were promoting shorts to protect themselves with options (see my previous posts.) I wish no one harm - just believe in prudence. Z reminds me of the bulls**t William Shatner had to endure when he took stock enumeration from Priceline when it valued under $10 and not making a profit. These same short soothsayers were laughing and saying it was or would become worthless. It closed today at $1236 per share. That's $1,236.00!
    Jul 24, 2014. 06:38 PM | Likes Like |Link to Comment
  • Bloomberg: Zillow looking to buy Trulia [View news story]
    With the millions of homes in the US, it would be totally impossible for Z to be right on the mark every time. People remodel, landscape, school access, etc. It would be impossible for them to get exact values.

    Zillow uses an algorithm based on market comparables in a given radius. If a home is on a neighborhood perimeter, with higher or lower priced homes in the circle, there will be some distortion. MLS had a similar problem in cities/communities where they used their "estimating equivalent value" tool. Of course, most of these estimates are based on square foot market $ market comparables - not taking into account stucco versus brick, or slate roofs versus asphalt. Their algorithm does factor in number of bedrooms/bathrooms. They just don't have resources for a professional estimate of each home.

    Have seen lots of complaints from one fellow (who is neither long nor short Z) that seems irate. They have offended him with an underestimate. A. What a moron. B. He should take up weaving or cross-stitch to calm down. That's why Z has all kinds of disclaimers and call house values, ZESTIMATES. Of course, according to law professor Alan Dershowitz, "People have the right to sue a ham sandwich."
    Jul 24, 2014. 05:11 PM | 2 Likes Like |Link to Comment
  • Bloomberg: Zillow looking to buy Trulia [View news story]
    Good luck on your short Getting Long. I still have my large position last year (started in the low 30's) and have been reading how shorts would be making a killing since. Read my previous posts - I've counseled these folks to hedge their shorts with options. Sadly, these experts have responded with either derision or vitriol.
    Jul 24, 2014. 02:48 PM | Likes Like |Link to Comment
  • Forget General Electric, Invest In Synchrony Financial Instead [View article]
    Will existing GE stockholders get any preference on subscribing to SYF shares? My broker wasn't sure since the share allocation to other members of the issuing group will be at the discretion of the lead underwriter(s). Anyone have any info on any advantage being provided current shareholders?
    Jul 24, 2014. 01:48 PM | 1 Like Like |Link to Comment
  • The Zillow Short Instruction Manual [View article]
    This AM, Quant Ratings (a service of "The Street") upgraded Z. If you check the analyst recommendations (includes major brokerage and investing banking firms, such as Goldman Sacs, Raymond James, etc.) there are now 4 Strong Buys, and 8 Holds on Z with a high expectation of 164. No "Buy", "Sell", or "Strong Sell" recommendations.

    Individuals speculating with shorts on Z need to hedged their positions with options. This would have been cheap insurance when the stock was in the 30's (last year.) it is certainly a prudent approach now.

    Yesterday morning I suggested people check out GWPH and ZTS. I just added to both of these positions. GWPH is up $4+ since yesterday; ZTS up $.50. Good luck to all of you.
    Jul 22, 2014. 11:23 AM | Likes Like |Link to Comment
  • The Zillow Short Instruction Manual [View article]
    Brian - In the legitimate market (NYSE, NASDAQ) where there is a widely traded security, with institutional participation, the market is the most perfect valuation tool for a security at any given time.

    Yes, the market ALWAYS considers and discount future potential into the current value of a stock. Th legitimate market is an auction made up of diverse buyers and sellers - many, many of which are analysts and professional money managers. I was a beneficiary of a vey intense graduate eduction from Merrill Lynch in New York many years ago. Many brilliant financial professors at NYU, versed not only in fundamental and technical analysis, but in the emotionally actions of "the Street." I am not specifically talking Z here, but all stocks at any given time, are worth exactly "what the buyers are willing to pay, and what sellers are willing to take."

    So yes, I am serious. Since you have a background in engineering, I understand your take on securities. In my career, i had over a dozen structural engineers reporting directly to me. Things are either black or white - depending on the reaction, specific gravity, stoichiometry, etc. Sorry, the market or a security cannot be quantified so precisely at any given time.

    I do not minimize, nor challenge your opinions on this. You are part of the overall universe which give individual securities their value. I sincerely respect your opinions and wish you well in your investing.
    Jul 21, 2014. 01:56 PM | Likes Like |Link to Comment
  • The Zillow Short Instruction Manual [View article]
    Sorry Surbiton, you gave been recommending this stock as a short since it was in it's 40's. Hope you have not acted on your own advice.
    Jul 21, 2014. 11:59 AM | 1 Like Like |Link to Comment
  • The Zillow Short Instruction Manual [View article]
    Bear commentary on "Z" has used these exact arguments over the last 18 months+. During that timeframe I've built my position at $32.50, $45.25, $60, finishing out my position (several thousand shares total) at $89. Each quarter readers have been warned of an imminent crash or correction of this stock by "bear commentary." After reading one compelling argument, I even hedged part of my position with options - what a waste of money! At the same time - read my comment history - I told the short promoter to hedge his downside with options.

    Most of my Z positions are now long term. 1. I am happy that my personal analysis kept me steady. 2. Following the brilliant bear advice, I would have missed the appreciation. 3. The bearish view only considers Zillow's value based on a static model - only future income streams considered/calculated based on current operations.

    From my perspective as a 50 year investor (with some great mentors) I learned that the market ALWAYS considers and discounts future potential income streams into the current valuation of a stock. Zillow has not exploited nor promoted these future prospects (forward guidance statement limitations and prudence by Zillow management) and that is appreciated here.

    Streams not calculated (nor monetized) - but with great potential - include click through income and renumeration from home decor and remodeling materials (lighting, flooring, paint, etc.), architectural ideas and referral, rental referral income, mortgage referral fees, more and better agent promotion tools, and finally commercial, industrial, office space and land sales/rental. I'm sure there are other areas I have not considered. While I have heard or read oblique suggestions about these areas in previous Zillow conference call answers, I think Rascoff is playing these opportunity as close to the vest as possible - not wanting to expose their hand.

    I appreciate your article and analysis. Under stable income stream conditions, it has merit. But Zillow is not a static situation - the market (a perfect valuation mechanism) is discounting something. I plan on selling about 500 shares to reap some capital gain and continue begin building new positions in what I believe could be the next high potential situations (ZTS and GWPH.) However, I will keep at least 1,500 shares. My feeling is that as Zillow begins to roll out and monetize their future, the stock will reach 200. I wish you well, but urge you to buy options to limit your "downside risk" on your short.
    Jul 21, 2014. 11:45 AM | 1 Like Like |Link to Comment
  • GE Earnings Impress, But Is It A Buy Here? [View article]
    Excellent, objective observations. Good article Raven. Also very concise comments by the Seattle Miner on the spinoff - thanks.
    Jul 18, 2014. 09:41 AM | Likes Like |Link to Comment
  • Is General Electric The Perfect Company? [View article]
    You make great points Banker. I'm not saying Welch wasn't a ompassionate individual. His rule #2 was indeed kind. And it is right that people that aren't performing know when the ax is about to fall. I've just read case studies (will try to find links) where some very fine long term GE executives were terminated for a slip (if indeed, they weren't sabotaged) under this system by some ambitious young executives. Sadly, Welch couldn't possibly know each case.

    I worked at Merrill in New York when it moved to One Liberty Plaza. The top financial firms were, at the time, very protective of the industry's self regulation. Most of the better firms operated with the highest ethical standards. My ML rep career was in their Nashville office.

    Thanks for your respectful replies. No disrespect was intended by me to your opinion of Mr. Welch versus Mr. Immelt. Jeffry took the helm of GE on September 7, 2001 (4 days before Twin Towers.) Financial multiples plummeted and stayed sporadically low (except for 2006-2007 bubble) this past decade. I think they are finally coming back (long RF and WFC here), but with GE going to their strengths - not without pain - we will see the stock in the 30's very shortly.
    Jul 16, 2014. 02:37 PM | 1 Like Like |Link to Comment