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  • Reviewing Today's Affordable Electric Cars: And The Winner Is ... Not Tesla [View article]
    ? for Herb Newman.
    Is there, why should there be, an active used market for Teslas?
    People here say they would keep it forever, or they bought something else in the final analysis.
    Just asking....
    Apr 18, 2015. 10:40 AM | 1 Like Like |Link to Comment
  • What Is Tesla Really Worth? [View article]
    OK a lot to ponder in this chain of commentary. First off: Enterprise Value is the sum of debt plus equity including preferred shares and minority interests (in other words the creditors' and owners' capital) minus cash and cash equivalents. I think the concept mentioned was: what would it take to buy this enterprise with other than its own cash? This is useful as a relative guide only -- relative to what? Actual (historical) 2014 Revenues (EV = 8 X Rev's) or EBITDA (EV = 818 X EBITDA) and either of the foregoing relative to other comparable companies -- what comparable companies? Nor is there any way to lever a transaction done at 818 times EBITDA; so taking that line of reasoning off the table.
    The only way to assess this opportunity is future cash flows -- which is essentially back to the "do you believe, or don't you" school of financial analysis.
    This is a trade with a base around 180 (not much room to maneuver below) and a high wherever you want to peg it. So much for financial analysis.
    Feb 16, 2015. 03:24 PM | Likes Like |Link to Comment
  • Tesla: Real Competition Ahead? [View article]
    Thanks for your article -- very readable and well illustrated. Had no idea the spoiler BEV's would not have compatible plugs with Tesla Supercharger sites -- seems like a problem one side or the other or an innovator could fix? Wouldn't informed consumers demand the option of the manufacturers?
    Preoccupied about the subsidy and the Gigafactory as both are statistically significant to the outcome. At the moment there is no cushion for "unforeseen consequences". Unless Apple? And I am pretty sure Tata and Volkswagen and probably Chrysler top end would like to see these guys out of the way or buy them for a song -- but you don't want that as your fallback as a shareholder....
    Feb 14, 2015. 10:04 AM | 1 Like Like |Link to Comment
  • Apple: Pride Comes Before A Fall [View article]
    Still carrying around my pre-MSFT Nokia to remind me how different things could be without an ecosystem. Post MSFT, I still cant get a decent golf yardage guide, talk to my FitBit, find a decent portfolio monitor, or pay for anything......
    I tried to make the MSFT case work, and the Surface, and slowly, inexorably Apple brought along the iPad ecosystem to where it functionally matches MSFT Office and excels everywhere else.
    Here's the problem with the bear case? When does Apple stumble and on what front? I believe I read iOS has surpassed Android in new app's introduced. We're waiting on iPhone within 60 days, iPads are slipping, but here comes an enterprise tie in with IBM, and ApplePay looks like it is gaining traction.
    The only real question is statistical significance of wins and losses at this stage except for one vulnerability external to Apple's control -- imposition of US taxes on un-repatriated foreign earnings could change the calculus for the worse. Probability and percent unknown?
    Feb 14, 2015. 09:24 AM | 1 Like Like |Link to Comment
  • LyondellBasell's Dividend Is A Head-Turner [View article]
    Well done!!!
    Feb 3, 2015. 04:51 PM | Likes Like |Link to Comment
  • Apple Analysis: Free Versus Levered Free Cash Flow [View article]
    Well done for perspective Mycroft. I'm still trying to pull apart Operating Cash Flow for my own info. Does anyone know the nature of the $7.3 B and $5.4 B of "Other Working Capital" items in the Morningstar cash flow numbers (and Balance Sheets)? That was a really big positive additive to Oper. CF in 2013 and 2014 that stands out. Also the Balance Sheet shows a $23 B increase in Common Stock and a decrease in Paid in Cap. by $19.7 B to zero an a decrease in Retained Earnings by about $17 B -- looks like a stock issue and recapitalization entries -- just askin?
    Dec 21, 2014. 03:26 PM | Likes Like |Link to Comment
  • CSX's 2015 Looks Encouraging [View article]
    Thanks for an interesting analysis. CSX seem to be underruning CapEx a little bit so I would add about 100 m to your FCF. At 1.266 m FCF your EV to FCF ratio is a somewhat daunting 36.8. Q3 2014 LT Deb is $9.6 B so on a current basis my EV would be 1.1 B higher for a ratio of (47.7/1.266) 37.7. Debt to EBITDA is 2 x so there is some room to do a levered financing of something, but not an LBO for sure. A piggy bank to turn over is the stock buy back at about $400 m this year, that would not change FCF as computed but does have practical effects. So would an eventual wind down of CapEx in the same vein. Let's say you could find $500 m of CapEx savings so we're talking $1.7 B of FCF with a ratio of (47.7/1.7) 28. And in EV to EBITDA terms it looks like 10 x not exactly bargain basement. The pop from $30 gracias a Bill Ackman made this rich unless they were to find a way to utilize the deferred taxes which appear to be running off in the opposite direction. I'm still not getting it I guess.
    Dec 20, 2014. 06:07 PM | Likes Like |Link to Comment
  • CP: A Dividend Growth Model Exposes The Over Valuation [View article]
    Michael you need to look at the leap puts, not short in these volatile times and in this stock. As usual a thoughtful analysis -- made the more so by the fact that CP just reported revenue growth in the 9-10% area. Given probable steady conversions from highway to rail transport and CP's newfound emphasis on domestic intermodal, CP could probably maintain or better a 9% growth in volumes but one should take note that domestic intermodal fetches less than their average revenue per unit of work. So, more work for less revenue unless you can push down operating expense ratio to revenues into the +/- 60% area as per CNR 58.8% yesterday, although their engineering makes a 1 for 1 duplication improbable. All in all an interesting contrarian speculation, see you in put land.
    Oct 23, 2014. 09:54 AM | Likes Like |Link to Comment
  • Occidental's California unit sees profit tumble amid rising production costs [View news story]
    We are all anxiously awaiting a detailed breakout accounting of California. Uncanny symmetry between CA being 20% of output and profits in CA being down 20% = does that mean OXY profits will be down 4%? (20% x 20%)
    Oct 22, 2014. 08:31 PM | Likes Like |Link to Comment
  • Apple Or Microsoft For Dividend Growth? [View article]
    Interesting analysis but three comments.
    First, Unfortunately I believe the legend colors are reversed on your charts -- graphics are everything, esp. for right brained AAPL devotees. (Which is why AAPL has been phenomenally successful and MSFT has been "present".)
    Second, there are lots of expectations about AAPL products and market leadership -- it's an exciting company even now in the summer/fall of its existence.
    Third, MSFT has to prove it has the products, even though I agree with you it has proven it has the financial ability to grow returns. Why? Because products instill excitement and excitement produces expanding P/E's and excitement has been woefully scarce during the long MSFT winter.
    I think MSFT could be a productive investment if they can instill excitement.
    I like the Surface and OneDrive, they need to push them.

    Sep 11, 2014. 10:04 PM | 6 Likes Like |Link to Comment
  • Gold Fields Has Big Potential As South Deep Matures [View article]
    Good summary and perspective. Management obviously committed to South Deep. But we just this morning heard Goldman say they thought gold prices would decline to US$1100 per ounce in 2014-5 -- at some point you have to start asking how you can minimize interim losses at South Deep. Perhaps a sensitivity analysis of GFI lines of business / mines versus gold price would focus the analysis? Assuming management listening. Long GFI.
    Sep 4, 2014. 10:47 AM | Likes Like |Link to Comment
  • Why Stratasys Will Outperform 3D Systems In The Long Run [View article]
    I notice you completely skirt the XONE issue in this analysis. Fair based on your premise, but if XONE ever learns to manage its administrative affairs and investor relations (promises) their technology inroads in some areas e.g. metals are very impressive. Could XONE be a disruptor for your thesis?
    Jul 4, 2014. 11:42 AM | Likes Like |Link to Comment
  • Dorian LPG: Big Revenue Bump-Up To Trigger Stock Upside [View article]
    Thanks for provocative article. For me it raises a larger set of issues:
    Who are their "peers" against whom they are under-performing?
    How many ships have the peers got in the water / on order to haul a relatively limited (but growing) amount of LPG?
    How many newbuilds are under contract by peers?
    This must be maybe half a dozen companies at most and some around for years. Some start-ups.
    Jun 14, 2014. 10:17 AM | Likes Like |Link to Comment
  • Apple: Yes To The iBuild 3-D Printer [View article]
    Interesting reading -- AAPL never fails to stir strong convictions. Here's where I can see this going: I wonder if AAPL isn't a little bit frustrated/threatened by GOOG's strong franchise in fun software that you can use to do stuff? GOOG brought Earth in house but have farmed out Sketch-up to Trimble (or perhaps Trimble developed it in the first place) and they focus hard on extending its reach. Sketch-up Pro is now probably as good as any for (strongly 2D oriented) architectural concept design and moving fast on detail design but a bit (no very) clunky for product (3D shape oriented) design. If product's the next frontier then that's what AAPL has to intercept with their own or someone's software to prevent erosion of their core markets. If you were to buy DDD today (less so SSYS?) for this purpose you would have to throw half of it away to get to the core synergistic business. Dassault Systems comes to mind. Disclosure: I have no positions in 3D printing but have closed profitable positions in 2013. I am watching the space.
    May 25, 2014. 11:57 AM | Likes Like |Link to Comment
  • Apple: Yes To The iBuild 3-D Printer [View article]
    An interesting article that spurred thought. There are a couple things that don't "feel" right about the thesis however. I have been interested in 3D from a modeler's point of view and to test out my investing and hobby thesis I learned to create 3D models in Sketch-up, make them watertight and transform them into 3D printing instructions. There are drawbacks that will probably be solved on parallel tracks by DOS and OS advocates. The process is not yet seamless although it is easy to see how Google could make it so (Sketch-up Pro gets closer that the free version). I didn't buy a printer: there are custom printers who impose their own "watertight" protocols and print items for you on a pricing scheme that factors in machine time (slow process compared to mass manufacturing) and materials cost (very expensive compared to mass manufacturing). To these reservations add surface quality, which, unless polished, is lower than mass manufacturing.
    Don't get me wrong this is a dynamic new field and is growing, particularly for one-off items, prototyping, and mold masters. There are increasingly more accurate and sophisticated machines coming to market -- at prices formerly charged for high performance PC's -- for now. Maker-Bot comes to mind and was acquired by Stratasys last June. Both DDD and SYSS are in the process of rolling up the machine builders. So yes, if you are GOOG or AAPL you probably buy one of them.
    But I am still having trouble on two points: Why would AAPL or GOOG want to get into the hardware business? How would AAPL get ahead of GOOG with its very strong Sketch-up franchise? Just asking: Steve Jobs I am not.

    May 22, 2014. 09:37 AM | 2 Likes Like |Link to Comment