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  • Is Kinder Morgan Stuck With More LNG? [View article]
    geocat, the price of nat gas had to be high to justify building gasification plants in the US so that the US could import it. Hess Oil a few years ago wanted to build a gasification plant in Rhode Island that would receive LNG cargoes from Trinidad, and perhaps the Middle East, and then be gasified here. The economics of that quickly fell apart when nat gas prices collapsed in the US on the back of fracking technology. In fact the Chenier liquefaction plant in Louisiana that will soon be exporting LNG was originally planned as a regasification plant that would receive LNG imports. The low cost of US nat gas ($2.80) makes exports from the US very competitive on a global basis even after liquefaction and shipping costs.
    Jul 24, 2015. 11:02 AM | 2 Likes Like |Link to Comment
  • Is Kinder Morgan Stuck With More LNG? [View article]
    Casey, I think you are right that nat gas prices will decouple from oil. In fact, it is already happening. In Europe Gazprom has renegotiated prices and uncoupled them, in part, from oil. In Asia the spot market for LNG cargoes is growing rapidly. In many ways there are similarities with the Iron Ore market. For years the producers ( BHP, RIO, etc,) set prices that had little to do with supply and demand. This fell apart a few years ago and Iron Ore prices collapsed. I expect to see the same with LNG. With Mid East LNG, New Australian production ramping up, and eventually some level of US exports, all fighting for market share in the Pacific Basin, I am not that optimistic on LNG pricing. Yes, nat gas is the fuel of the future, but we may still be oversupplied. Don't know what the economics are of liquifying US nat gas so when along the coast of the Gulf of Mexico and then sending it through the canal to Asia are, but Shell may think they are not that appealing.
    Jul 22, 2015. 06:47 PM | 2 Likes Like |Link to Comment
  • Dunkin' Brands: On The Right Track But Not The Right Time To Buy [View article]
    Liang Yu, they take a cut of the top line. Thus inflation is good for them. Further, the franchise owner pays for advertising and the cost of the central commissary. DNKN is a complete asset light company. Everybody likes to compare them to SBUX, but there are as many differences in the respective business models as there are in the respective consumer experience.
    Jul 15, 2015. 10:14 AM | Likes Like |Link to Comment
  • Dunkin' Brands: On The Right Track But Not The Right Time To Buy [View article]
    The cost of eggs, coffee, etc does not impact DNKN because the franchisees carry that cost. The impact of higher egg prices could impact sales if franchisees raise prices and that results in lower demand, but that's it.
    Jun 19, 2015. 07:21 PM | 1 Like Like |Link to Comment
  • Verizon-AOL: Whither The Huffington Post? [View article]
    Randy B, why do you think it is worth $1 - 1.5 bn? Just trying to figure this out. Not interested in the politics. Thanks
    Jun 11, 2015. 10:35 AM | Likes Like |Link to Comment
  • Verizon-AOL: Whither The Huffington Post? [View article]
    It's worth $1 bn if somebody is willing to pay that. Is there any info about what sort of revenue it generates and whether or not it makes a profit.
    Jun 4, 2015. 09:47 AM | 3 Likes Like |Link to Comment
  • Verizon Unbundling Shows Weakness In Phone Model [View article]
    Your comments are correct. But they do not address the author's contention that telcos are losing the battle with cable to provide broadband internet access. The cable companies also provide unwanted programming and are under pressure from the likes of roku, hulu, Apple tv, Netflix, et al. to unbundle.
    Apr 18, 2015. 08:30 PM | 2 Likes Like |Link to Comment
  • Investing Abroad - Key Is Total Return [View article]
    Mark, a depreciating currency should result in expanding PE ratios as multi nationals benefit from the translation effect on overseas earnings and newly found competitiveness for domesticly produced goods. Over the very long run my 30 years of investing internationally ( starting in your firm's Zurich office) suggests to me that the fx impact is a wash for investors. However, while owning non US stocks in my portfolios I have also added hedged ETFs from Wisdom Tree.

    Your comments about the impact of fx on bonds is interesting. There is nothing that really can offset the fx impact on a non dollar fixed income portfolio. A declining exchange rate will not necessarily lead to lower rates, might just lead to the opposite.
    Feb 14, 2015. 08:50 AM | Likes Like |Link to Comment
  • Bill to ban online gambling floating around Congress again [View news story]
    In the UK and Australia on-line gambling has been around for a few years and the record does not suggests that it creates greater levels of problem gambling. In fact those countries have lower levels of problem gambling than the US.

    I would also suggest that, though existing casino operators have experience and the wherewithal to build their own on-line presence, the existence of nationwide online gambling is a huge threat, and they recognize that. Once on-line becomes a presence in any industry disrupters will enter the market place. There's no guarantee that existing players will be able to respond. Just check in with Barnes & Noble.

    An on-line presence requires much less capital than a physical presence does. Existing owners of real estate based gambling will have to respond by building their own on-line presence and at the same see returns on their legacy capital base deteriorate. This is similar to what is happening to a lot of software companies that are transitioning to the cloud. Short term pain for hoped for long term gain. But the transition creates greater risk. Some will fail to make the transition.

    No doubt Adelson and Wynn recognize this.
    Feb 6, 2015. 11:07 AM | Likes Like |Link to Comment
  • ConocoPhillips' Pragmatic Management Continues To Be Ahead Of The Curve (And Exxon Mobil) [View article]
    Thanks, it was a good article. I've owned CVX for years and usually comped it vs XOM. Was a mistake not to look at COP more closely. XOM's management made some bad acquisitions and they have not done a great job creating value.

    I am also a bit worried about CVX because I do not particularly like their Asian LNG exposure. Capex based on nat gas long term contract prices may be a problem for them. Not sure how good those contracts will be. European gas buyers have renegotiated nat gas contracts to reflect the changed environment. Asian nat gas buyers could do the same. Something similar happened in iron ore a few years ago when the miners went from annual contract to spot.

    Kind of hoping we get another leg down in oil. Will try to use it to increase exposure. Tough to time though. Oil share prices usually bottom before the price of oil and oil before rig count.
    Feb 6, 2015. 10:52 AM | Likes Like |Link to Comment
  • Oil Inventories Continue To Swell [View article]
    thanks for the info Lynn. Suggests that the price of oil may continue to find some support as excess supply goes into storage.
    Feb 6, 2015. 08:20 AM | Likes Like |Link to Comment
  • Bill to ban online gambling floating around Congress again [View news story]
    Ryan, in complete agreement with you. Online gambling is just one of many forms. Systems can be built in to limit bet size, etc. to minimize risk. There is till plenty of illegal gambling taking place and efforts to restrict gambling will only drive people to illegal venues. Vested interests and big campaign donations are behind this. States rights and the free market are at risk.
    Feb 5, 2015. 03:15 PM | Likes Like |Link to Comment
  • ConocoPhillips' Pragmatic Management Continues To Be Ahead Of The Curve (And Exxon Mobil) [View article]
    How about just owning COP alone? How does that strand up to XOM and CVS?

    Yes, PSX has done great following the spinoff, as has its peers. And that definitely was a decision that created value for shareholders.

    But COP's peers, XOM and CVX over the last six months, since before the collapse in the oil price, have actually outperformed COP.
    Feb 5, 2015. 01:37 PM | 1 Like Like |Link to Comment
  • Oil Inventories Continue To Swell [View article]
    Guess I'd like to know how much storage capacity is left. What % of the land based tanks are fully topped up and how many tankers are available for water borne storage. At some point, I would think, when storage capacity is full oil futures go into backwardation and then the price plummets.
    Feb 5, 2015. 12:09 PM | Likes Like |Link to Comment
  • Morgan Stanley Sees Oil Exposure Risk, Lowers La Quinta's Price Target [View article]
    I'm in your camp. Black stone has to sell, it's simply how private equity works. You have to cash out at some point. I also, like you don't disagree with JY's thesis that they have heavy oil exposure and may disappoint with upcoming results. I bought after the IPO and had a decent, though short term gain, but sold partially based on JY's analysis. The hotels in TX are more likely to be fully owned than franchised so the hit to LQ's bottom line is greater. However, longer term this is a good story. They are moving steadily to the full franchise model which means a steady growth in ROIC and free cash flow. The new hotel formats are also attractive and competitive with other hotels in their category. And they have room to expand geographically in the US and in South America. There is a growth story here as well as a free cash flow story. Debt will be paid down quickly. If the shares get hit on upcoming results I may look to get back in.
    Jan 27, 2015. 12:57 PM | Likes Like |Link to Comment