Seeking Alpha


Send Message
View as an RSS Feed
View markcc's Comments BY TICKER:
Latest  |  Highest rated
  • Tesla: Elon Musk Unveils Secret 2015 Margin Target [View article]
    atonra, just to clear-up some misconceptions about "capital expenditures", capex is not and "expense" as you say. Instead moves cash from the cash line on the balance sheet, as components are paid, into a "construction-in-progr... account. The expenditures show up on the "statement of cash flows". Typically projects that size take more than one year to complete, so the movement happens over a number of years. Once the plant is completed and put into production, the project is moved into assets on the balance sheet and the depreciation shows up on the "income statement", but it is then a non-cash charge since the actual cash was spent in prior year. The important factor for investors is to watch the cash in case they look like they will need more.
    Sep 20 06:24 PM | Likes Like |Link to Comment
  • Update: Tallying Up Model S Sales Up To August And Its Implications [View article]
    Doug, Generally in the US there are several voltages used in different portions of their networks. Each company grew up by itself, so only the plug voltage is standard. I can only generalize, so here it is. Transmission Lines, generally 200-800KV carry the bulk of the energy, "sub-transmission" is usually 50-200KV and then Distribution is 13-50KV. Pole mounted transformers are mounted outside a residence or sometimes are in the back of the house on the ground, depending on overhead or underground distribution. So the line loss issue is typically only the last 50 feet to the house.
    Sep 20 04:25 PM | Likes Like |Link to Comment
  • The Best Pick Among Airline Stocks [View article]
    starcorral, your definitive statement that "Airline prices are down due to uncertainty about the impact of terrorism" seems not supported by fact. Terrorism has been around for a long time and the airlines report that their planes are filled to 85-95%, a record high. While the fall season is softer, there is not any perceptible abandonment for flying at this time. As for your political arguments about oil and the military, they are also the same arguments we, as a society, have been having for a while now and are not likely to lead to investment decision making.

    Factual corrections, Borman was CEO of Eastern Airlines, not Pan Am, so had nothing to do with Lockerbie. And Obama is the ONLY US president to shake Gaddafi's hand (July 9, 2009). And was the President at the time of the release of the Lockerbie bomber (August 20, 2009) hmmm..
    Sep 20 02:50 PM | Likes Like |Link to Comment
  • Update: Tallying Up Model S Sales Up To August And Its Implications [View article]
    Neil_anderson, It is clear that you are a Tesla acolyte and you don't see the realities of making cars from a production manager's perspective.

    Having worked as a consultant to the auto supply industry, may of the constraints you propose simply don't exits. I have been involved with manufacturer, when faced with supplier strikes, can within a few weeks, qualify a replacement supplier in high volume to keep production going.

    There is one phrase said to suppliers that don't deliver on time - You're fired! (and sued for stopping production.) This is the brutal reality of the supply industry.

    Car manufacturing is a no BS industry in this country. What you hypothesize is a 1970's form of thinking that simply does not exist anymore. If Tesla can't compete cost wise with these other guys, they are screwed. Of course, I am used to working with car plants that will make as many cars in three weeks as Tesla makes in a year. I do not know Tesla's complete set up, but it appears to be organized more like an electronic manufacturer that integrates major sub-components made in many locations, and due to high margins this works for that industry, but not for cars.

    Tesla needs the money from more car sales. You suggest that a robot is out makes no sense in the volumes we are talking about. Again, the big guys fire people that can't make the robots work nearly 100 percent of the time.

    About your comment about the airline industry, unlike automotive, the unit production in the aerospace industry are, in most cases, too low to invest in any meaningful automation. Remember that the highest volume Boeing 737 production rate is only 456 planes per year which makes it difficult to amortize investments in automation. When you see a car, say a Ford Fusion has a production rate in excess of 250,000, the equation is different and we see pictures of cars coming down assembly lines with machines making sparks. Model changes and component changes in the industry complicate the automation equation as parts are redesigned and fit into different body styles.

    My favorite conclusion? Whats that? Just the facts. Your comments seem skewed toward downing any criticism and denying any real realities facing Tesla.
    Sep 20 01:27 PM | 3 Likes Like |Link to Comment
  • New JetBlue CEO tipped to raise bag fees [View news story]
    taplinger, I appreciate your protection of th passengers, but there is a bigger picture here. The airline market has become stable and hyper-competitive. To be sure nobody at JetBlue has said anything specific about changes, or whether you will be able to purchase premium service for a price, so your comments seem to criticize before any formal announcement. It is not fair to JetBlue to presume a specific change. Its the Wall Street analysts that have been pushing for key decisions to improve operating margins. JetBlue has the lowest operating margins in the industry and is potentially not sustainable during a big downturn or will make JBLU a buyout target by another airline. All the things you say the flyers of JetBlue are supposed to get will go away if the airline does not act with market realism.

    For discount airfares, you would have highly successful airlines like Spirit, who will move into JetBlues space. Already, with 1/4 the number of planes, Spirit's market cap is 80% higher than JetBlue's, making JBLU a buyout target for Spirit. If margins, profits and the resulting market cap don't increase, JBLU is gone by buyout anyway by Spirit or someone else. If you think that does not happen, look at the Frontier Airlines buyout by Indigo Partners. Frontier's offering was similar to JetBlue with a big hub in Denver, but never could make any money. Indigo is in the process of doing the things you don't like because there is money in it. JetBlue is the next target.

    I see this move as the only way of preserving the independence, relatively low cost and high service levels of JetBlue. I don't think Barger understood that his strategy inevitably would have led to the end of JetBlue in a Wall Street buyout.

    By the way sour grapes by flyers, still getting a deal in 2014 and hoping for a return to the unprofitable industry of the 90's and 2000's makes no sense.
    Sep 20 07:00 AM | Likes Like |Link to Comment
  • Update: Tallying Up Model S Sales Up To August And Its Implications [View article]
    neil_anderson, there are a lot of ways of getting production up, if they had the demand. Not running flat out in the face of lines of customers should raise a red flag. In the auto manufacturing for the big guys, they usually run 4 10's for up to 7 days a week, depending on demand, leaving 4 hours for general cleanup and maintenance. Based on whats here, Tesla is underutilizing their factories.
    Sep 19 02:44 PM | 1 Like Like |Link to Comment
  • New JetBlue CEO tipped to raise bag fees [View news story]
    Don't count your bag fees so fast. There are also additional seats you can still fit comfortably on their planes.

    But if you focus on bag fees, you can count on half the 40,000,000 passengers paying about a $25 bag fee, or about $500,000,000. Take a third out for taxes and you are left with about $330,000,000, or about $1.10 per share on top of 2015 consensus estimates of .69 per share, that brings you to about $1.79 per share. For a stock selling for $11.50, that makes a PE of 6.4X 2015 earnings, a no brainer buy today.

    As for seats, JetBlue does not overbook, so pushes away people on overbooked flights. Adding one row will make their core 150 seat planes 156 seats, at an average seat price of $170, that adds up to $1,000 per flight. At 300,000 departures per year, that would add $300,000,000 per year, or about .67 after tax (if all rows were full). How about adding 2 rows and making JetBlue planes the same as Delta's seats? Another .67 cents per share.

    It all looks like upside from here. The tough analysis is the tradeoff in customer satisfaction which is not quantifiable easily.
    Sep 19 11:49 AM | Likes Like |Link to Comment
  • Update: Tallying Up Model S Sales Up To August And Its Implications [View article]
    Germans will buy a non-Grrman made car, when there is a German made one? I think not. You underestimate the nationalism in Germany. And before you say their car sucks, time will allow them to improve their product.

    To be clear, I think EVs are the future, but the estimates we see with the current performance statistics preclude a mass market for a few decades. Remember that most experts estimate we still have over 300 years of gasoline, way beyond what anyone in our generation is worried about.
    Sep 19 11:20 AM | Likes Like |Link to Comment
  • Tesla: Elon Musk Unveils Secret 2015 Margin Target [View article]
    jerry, the problem is that small investors are just along for the ride. Let him cater to the big boys as long as we have a seat on the bus, if we want it.
    Sep 18 05:38 PM | Likes Like |Link to Comment
  • JetBlue announces CEO change; shares +5.5% AH [View news story]
    Great news with a big pop in the stock as JetBlue suffers from low margins and has not focused on ancillary revenues. Robin Hayes will do the things to squeeze extra operating margin out of the company. Hopefully, they can take their 7% margin performance closer to Delta's at around 12%, but it will be at the sacrifice of some seat space and freebies.
    Sep 18 05:17 PM | Likes Like |Link to Comment
  • Tesla: Elon Musk Unveils Secret 2015 Margin Target [View article]
    Just checking Ford's operating margin and it is 19.1% for the last quarter. The 11% projected by Musk falls below that number and will eventually lead to predatory practices by the bigger companies if a significant market develops for EVs.
    Sep 18 03:35 PM | 2 Likes Like |Link to Comment
  • Tesla: Elon Musk Unveils Secret 2015 Margin Target [View article]
    Is this Enron again? Management that is put in the position of having to give unreasonably optimistic forecasts just to keep the whole company going?
    Sep 18 11:05 AM | 8 Likes Like |Link to Comment
  • Update: Tallying Up Model S Sales Up To August And Its Implications [View article]
    John, I agree with the need for safety. At lower voltages this is less of an issue, but you have to beef up the wiring to transport the amps. It is like AC/DC, an engineering design consideration that someone flipped a coin and went with 120v instead of 240v. Each standard has its own costs and benefits. By the way "pole voltage" in the US is generally 13KV, and it is possible to buy different voltages, generally for industrial use in equipment and refrigerators. Higher voltage is generally sold more cheaply per kWh.
    Sep 18 09:02 AM | Likes Like |Link to Comment
  • Analyzing Tesla's Demand And How It Will Drive The Stock [View article]
    Market last, I agree that it appears that they have little protection in the battery area. Independent researchers are probably already tieing up potential patents for future batteries.
    Sep 18 08:55 AM | Likes Like |Link to Comment
  • Analyzing Tesla's Demand And How It Will Drive The Stock [View article]
    tomfrompv, battery capacity is just a timing issue. If the market develops, then the battery factories will appear. There is nothing static about that 3 factory number for Nissan. Like any major company, I am sure they have plans if the Leaf, and other EVs take off. Don't forget that there are already about 7 companies with electric cars, many with their own plans for battery plants.

    The real question is patent protection. Is there something special about Tesla's batteries. The guy at the Tesla store told me "these batteries are like the one in your laptop, just a lot of them".
    Sep 17 05:02 PM | Likes Like |Link to Comment