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scchan.2009

scchan.2009
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  • Uralkali CEO detained in Belarus [View news story]
    And what on Earth is Uralkali's boss doing in Belarus? If he is there to secretly negotiate with Belarus, this further straightens Bill Doyle's view on recent events. Also this is a red flag in investing in any former USSR nation companies - can you even trust the accounting and the rule of law there?
    Aug 26 10:09 AM | 3 Likes Like |Link to Comment
  • Southern Company - A Good Prospect For All [View article]
    SO is a good candidate for long-term dummy dollar-cost-averaging investing strategy especially for IRA accounts. Even there are short term interest rates issues and new power plant development, the company is historically very well managed, cautious in borrowing, have a gold-plate reputation, and defensible moat in the Deep South.

    In the short term, SO does appear somewhat expensive in terms of PE, but this is a problem shared by SO peers and other defensive stocks (PG, KO, etc).
    Aug 24 09:40 AM | Likes Like |Link to Comment
  • J.C. Penney Dying Like A Crazy Headless Chicken [View article]
    Really shareholders should say something about outrageous benefits and pay packages to directors and executives. Show them who play the game by ticking "Against" on the board election on the ballot.

    Earlier this year, Swiss government makes the law that executive pay package votes to hold real power (instead of being advisory vote only). The law has the full backing of Nestle - probably the most famous Swiss company in the world.

    In this site, we talk about stocks, I guess talking about corporate ethics is as important. The punchline is - shareholders own the company, and the executives and the board WORKS FOR the shareholders. Shareholders better make sure those bast***ds don't waste money.
    Aug 20 09:00 AM | 1 Like Like |Link to Comment
  • Potash And The Fertilizer And Agriculture Companies: Don't Panic Is Rule # 1 [View article]
    I don't think POT is the type of company gets really super excited to come in for a buy frenzy - PotashCorp's business is just too "boring". However, selling panic will applies to pretty much all publicly traded company.

    If nothing happens with the Russian trash talk (the case Doyle has presented as the most likely scenario), it will take PotashCorp and its peers a few months to move back to where the pre-panic sell off. In the mean time, anybody who takes on long positions for medium-long term can enjoy the high dividend ratios for a 1-2 quarters.

    Anyway never try to the time the market. PotashCorp was a good business to buy before the sell off, and it is still a good business to buy. No one could have timed the Russian announcement (except the few Uralkalis insiders). There are always unforeseeable risks in investments, but companies with strong balance sheets have much better chance to survive in sudden downside risks.
    Aug 10 12:29 PM | Likes Like |Link to Comment
  • J.C. Penney Dying Like A Crazy Headless Chicken [View article]
    I agree with you that I do not think Ackman understood JCP business model and what had made them competitive for long time.

    Large changes of board and executive members are often a red flag in the future prospects of the company. Of course, there are cases such changes work very well (and necessary just to save a company from collapse), it can also be a major negative as well. I think - "if it ain't broke, don't fix" is a good way to see executive and board member changes. JCP was not broken, a fix lead to a disastrous outcome. Now JCP is broken, and it definitely needs fixing.

    Frequent changes of executives and board members are bad. Many of the stable and successful companies have executives and board members that work with the company or the same business field for over 20 years. A Silicon Valley marketing guru is really an odd mix with a grandma and mom's weekend department store.
    Aug 10 12:12 PM | 2 Likes Like |Link to Comment
  • J.C. Penney Dying Like A Crazy Headless Chicken [View article]
    Bill Ackman's mess with JC Penny and Herbalife indicates he does not deserve much points in investing, managing and humility.

    Ackman shared the same building with Soros. I think the old man Soros should have some wisdom to share with him. It is not just wisdom in Wall Street, but some wisdom for just being a reasonable human.
    Aug 9 08:58 PM | 2 Likes Like |Link to Comment
  • J.C. Penney Dying Like A Crazy Headless Chicken [View article]
    I don't own any JCP shares. However, when things like this happen, the other (institutional and retail) shareholders should step up, and kick Ackman out of the board. It is ridiculous that other shareholders to let this continue. They are losing money for letting this showman to continue his show.

    Nevertheless, I question does Ackman with his big bucks understand what are in the mind of JC Penny shoppers before his intervention or people who have worked in JCP for the whole life. I will feel bad if JCP ever closes door.
    Aug 9 04:39 PM | 5 Likes Like |Link to Comment
  • J.C. Penney Dying Like A Crazy Headless Chicken [View article]
    Bill Ackman may or may not have been wrong of MBIA, Herbalife or JCP (or even P & G and Hong Kong dollar), but he has become a poster-boy in what has gone wrong in high Wall Street finance - out of touch, arrogant, and Alpha-Male attitude.

    He should have just shut up and let the rest of the board members to sort things out. It may or may not save JCP, but his inability to keep his mouth shut is certainly not helping. I feel bad all the job losses that may be coming in the near future, and I am not sure that will be make Ackman feel sorry.
    Aug 9 04:23 PM | 6 Likes Like |Link to Comment
  • Bill Doyle: Potash Savior [View article]
    One thing good about Doyle or POT management is that it is an internal promoters. It is managed by people who are in this business for long time.

    It is hard to imagine Doyle will have another job for his life...
    Aug 9 02:13 PM | 1 Like Like |Link to Comment
  • Bill Doyle: Potash Savior [View article]
    That part with the close relationship between US/Canadian buyers and PotashCorp was yes indeed quite ridiculous. However, it does tell how personal he feels about the company - he worked there for over 30 years anyway. Quite frankly, PotashCorp is his life.

    Other parts of the interview were highly informative. I think I learned something how the business works. He does feel "the other producers" will come out okay.

    I posed my question, but he didn't have time to answer it (i.e. question about 3-4% per year UN and PotashCorp's own growth forecast of consumption of potash). The question was asked that current growth of global potash mining capacity is expected to grow 50% in 10 years (discounting BHP). That is actually in line with the 3-4% per year growth in demand.
    Aug 8 08:22 AM | Likes Like |Link to Comment
  • Potash Corp. CEO sees cartel breakup as short-term [View news story]
    The full replay of the discussion should be on PotashCorp website (I listened it to live). It is only 20 - 30 minutes long.

    Spats happened in the past was one of the first thing he mentioned.
    Aug 8 02:45 AM | Likes Like |Link to Comment
  • Do The Fertilizer Stocks Really Stink As Bad As The Market Thinks? [View article]
    Key things Doyle mentioned:

    1) Bad blood between former-Soviet potash miners is not new. It had occurred before Uralkalis was a public company. Previous fights were not as public as this one.

    2) Cheap potash price war had occurred in the past before PotashCorp was public (and PotashCorp participated in such price war). It was illogical to wage such war as no one makes money.

    3) PotashCorp sells 40% of its product within North America. Former-Soviet miners have their own close customers. It is unlikely price changes will cause either side taking over each businesses.

    3) Canpotex and PotashCorp had close relationship with customers. BHP Billiton does not enjoy that relationship.

    4) It is illogical for Uralkali to reduce its own price, and Doyle does not believe Uralkali has the means to move the price that much. Supply of potash can adjust to price changes, and potash demand is inelastic (cutting price does not make farmers need more potash).

    5) Canpotex is a robust alliance. A breakup is highly unlikely.

    6) Dividend cuts are unlikely, and no change to share repurchase plan. PotashCorp had the balance sheet to back the current dividend and share repurchase.

    7) Current expansion plans will be carried out. PotashCorp is conservative in their expansion plans.
    Aug 7 03:32 PM | 3 Likes Like |Link to Comment
  • Potash Producers Look Expensive Even After Plunge [View article]
    Sorry to be somewhat side track, in about 10 minutes (1500 EST) PotashCorp CEO will have a public online meeting session. Information is available on PotashCorp website.
    Aug 7 02:51 PM | Likes Like |Link to Comment
  • Disappointed By Sony Rejecting Loeb? Don't Be, Activist Investing In Japan Is Tough [View article]
    Back to about Japanese corporate culture, some of the younger companies do try to take the more "American" route such as Rakuten (Rakuten boss thinks he is Jeff Bezos of Japan).

    Since I mentioned Nintendo, the current executives and chief engineers in Nintendo have been pretty much the same for 30 some years.

    I guess different corporate culture has its own strength and weakness. While many Japanese tech companies remain very traditional in office culture, they are not lack of innovation - anybody who are into electronics, automobiles, and video games can tell you that. Japan still produces some of the best engineers in terms of technical skill, but their enclosed corporate culture often makes them lag behind if there is sudden fundamental change in the global business environment. However, a strong workplace unity (like in Japan) is a strength when good long term goals are set.
    Aug 7 11:05 AM | 1 Like Like |Link to Comment
  • Disappointed By Sony Rejecting Loeb? Don't Be, Activist Investing In Japan Is Tough [View article]
    I think in medium term, investing in Nintendo is essentially going short against the mobile-web gaming hype. Most of the Nintendo executives are very adamant against "Zynga-type" gaming. The famous catch phrase "A bad game is forever bad" comes out from the mouth of a Nintendo executive (Miyamoto - one of the most important figures in the rise of video gaming).

    The challenge for Nintendo now is if their propriety quality-over-quantity model be suitable in the future. Can Nintendo defend their economic moat against the rise of mobile-web gaming? That's the million dollar question. (Actually billion, as Nintendo has market cap of about 15 billion USD ;-)
    Aug 6 04:08 PM | Likes Like |Link to Comment
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202 Comments
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