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  • TIBCO's Return To License Growth Frustratingly Inconsistent [View article]
    As Tibco's customer base works hard to gain analytics capability, open source solutions create enormous challenges to business models. I think this is an area where services execution may be more important than sales execution in the product sense. That said, Spotfire is cool.
    Dec 20, 2013. 11:28 AM | 1 Like Like |Link to Comment
  • At A Decade-Long Low, Annaly Capital Management May Be A Buy [View article]
    Three things happen with rising interest rates. First, spreads increase. That assumes the short rates are relativly fixed, which i think we all agree on. Second, buyers become shy and new mortgages slow. I think that is also self-evident. Lastly, NAVs shrink, which is not directly observable, but is a derivative action of CAPM. I get CAPM in the bond markets, but not here. Excluding opportunity cost, whose effect is understood, why would a rise in the long rates effect a contract (mortgage) with a fixed rate? Aren't most Annaly holdings fixed rate?

    I simply can't reconcile this drop with what seems obvious nor with the behavior of the managers.
    Dec 17, 2013. 09:24 AM | 2 Likes Like |Link to Comment
  • Should Sprint And T-Mobile Join Forces? [View article]
    I still don't see accretive value in Sprint/TMobile, yet it looks like something is indeed happening. Some thoughts.

    1) Maybe there are geographical overlays that offer synergy and the idea of swapping stock, not cash, is attractive. And maybe that balances out the roaming fees paid to Verizon. Verizon is sure touting their better national footprint. Maybe Sprint feels they can't do it on Network Vision alone.

    2) Certainly the rapid rollout of LTE eliminates the network incompatibility issues, which are all in the RAN and have to do with 3G only. Still, my guess is that the bulk of their subs airtime is on 3G service and there are still plenty of 3G only phones in use. It still bothers me that Hesse or Son would pull another Nextel. I think that would be a big, big mistake.

    3) Money is still free. If you're going to do a deal, better hurry!

    4) Pricing is not even close to being competitive yet, but the FCC may be weighing the great good of building out the national infrastructure on the backs of investors and subscribers plus the tax revenues telecom fees generate, against causing the market to say 'uncle' or attracting truly disruptive competition.

    5) #4 notwithstanding, Google and Comcast still scare the %^* out of them all. Imagine a carrier that leveraged all the WiFi access points out there to provide mobile voice, video and data service for the cost of a phone plus a random ad popping up. That kills carrier revenues and taxes. The carriers better have plenty of low freq spectrum to keep their high-margin 'mobility' niche in a bigger broadband market. I wonder if a Sprint/TMob merger delivers on that?

    There are sure a lot of dynamics and probably political drivers we don't even know about. That said, in sum, there still doesn't appear to be a good enough reason for a merger.
    Dec 14, 2013. 10:37 AM | Likes Like |Link to Comment
  • Should Sprint And T-Mobile Join Forces? [View article]
    I guess the guys at CS are either not very good, or simply missed this one.
    Dec 14, 2013. 10:03 AM | 1 Like Like |Link to Comment
  • Inflation Is Dead, Long Live Deflation [View article]
    God bless everybody here. I thought I was the only one in the world that didn't get the 'inflation is good' argument. Those who point to debt rising in value cannot be oblivious to the other side of the seesaw. In fact, any inflation at all erodes the value of savings and therefore discourages saving and encourages consumption. Now there's a philosophical argument a-brewin'.

    As to the fed cooking the inflation numbers - it's not the fed doing the cooking. It's the BLS - your friendly government officials. And if you think about it, when a tax system is based on income, well, inflation is just ducky! Alas, consumption taxation would be little better!

    Inflation is absolutely destructive to any monetary system. Since the US Dollar is the king of the hill right now, Dollar inflation is the worst kind, globally. Of course, debtors will not agree with that! Anyone know any debtors?

    It irks me that my government is willing to erode the value of my savings to diminish the overhang of their (our) debt.
    Nov 21, 2013. 10:41 PM | 4 Likes Like |Link to Comment
  • Should Sprint And T-Mobile Join Forces? [View article]
    Bad idea. TMobile and Sprint use different systems and Sprint doesn't need anything TMobile has, just baggage. The market needs the competition. Google will certainly enter the service provider market and the widespread use of LTE will blur the lines between the Comcasts of the world and the Sprints of the world. With all that competition, Sprint needs to be as strong as possible, and a merger with weak sisters like Dish or TMob is inane. If Sprint wants to 'merge' it should look to Comcast or Charter, or even Google!
    Nov 20, 2013. 12:24 PM | 4 Likes Like |Link to Comment
  • Annaly Capital: How Bulls Can Overcome Cognitive Dissonance [View article]
    It's even more than that. The Fed will exit MBS first, apparently, which seems to be positive for MREITs.
    Nov 16, 2013. 10:52 AM | 1 Like Like |Link to Comment
  • What Hedge Fund Analysts Expect LinkedIn To Report [View article]
    So now the report is out and it's not good. LinkedIn has a problem. They do not offer fair value. Their service is quite useful and worth paying for, but not at the levels they've set, and alternatives are developing. They've got to find a better way to segment the market, or their investor is going to get screwed. Management won't because there are no real COGS. Be wary! Watch how they address this latest earnings report. It should signal what the next will look like.
    Oct 30, 2013. 11:34 AM | Likes Like |Link to Comment
  • Sprint NI of $383M [View news story]
    This seems like a fantastic report. The idea that you can shed a network (expenses) without shedding the revenues is ludicrous. The fact that they made a profit (finally) means that the net of expense loss and revenue loss was positive - all while building out a network.

    The reason I'm so pleased is that they are not navigating this iDen fiasco while prices are collapsing - which is sure to come. They're building out their network, taking their Forsee-induced losses, and making hay while prices are high and stable. In companies of this size, it is very hard to say no to revenues and big customers, even when it is clear that you're riding a losing horse. Sprint made the commitment and did the job. I'm sure it was tougher than any investor really knows.

    I also think that the Clearwire thing was a brilliant move, not only for the spectrum, which is value enough, but for the experience building out and running smaller, more modern equipment.

    Certainly Verizon is a great company, but Sprint has far far more upside for investors as long as Hesse and the team continue to execute as well as they have. Even TMobile is doing all the right things in this space. They'll all be well positioned to do well even if prices do fall, which I believe is inevitable.
    Oct 30, 2013. 10:58 AM | 1 Like Like |Link to Comment
  • The mREITs Face Even Greater Headwinds - Avoid Them [View article]
    RS - I like your comments and enthusiasm, but if you've changed your opinion when the only difference is that people are calling for more oversight - well that just doesn't make sense to me. More oversight is delightfully positive for investors. Just how can you see it differently?

    In fact, the REIT model is dead simple. It's made complicated by the hedging, which is done to minimize the risk. When rates started to rise, the bond-mentality in many investors said that prices should therefore drop. That's overthinking a simpler problem. The rates matter little to how much a REIT earns - it's all about the spread times leverage. The spread has indeed fluctuated, but within a range. When the yield curves invert, that's when REITs are in danger. That rarely happens, but it does happen. Risk reward. It would take a very poorly managed fund indeed to not be able to survive a short rate inversion - especially because you can always see them coming - the macro environment is melting down.

    That said, anyone who thinks this is risky should not be in it as RS says. That way, those more out on the risk reward spectrum can make a killing.

    The thing that I wholeheartedly agree with you on is that noone seems to understand this primitive, fundamental business model.
    Oct 13, 2013. 11:30 PM | 2 Likes Like |Link to Comment
  • Can Sprint Break The AT&T/Verizon Duopoly? [View article]
    Sprint will! It's a matter of when. There are no longer any WiMAX handsets in the offing, so as legacy support diminishes, so will their incentive to keep it going.
    Oct 1, 2013. 11:30 AM | Likes Like |Link to Comment
  • Can Sprint Break The AT&T/Verizon Duopoly? [View article]
    Remember that the legacy landlines are not such a bad thing and Sprint does have a big business there. If you mean "dial-up" service provider, then yes, that's a bad thing and they have very little exposure from what I can tell. But they have a ton of fiber and copper in the core of the internet and that is of huge value. I don't really know where they stand compared to V or T, does anyone?
    Oct 1, 2013. 11:22 AM | Likes Like |Link to Comment
  • Thermo Fisher Acquiring Life Technologies: Implication Of The Deal [View article]
    Oh, I strongly disagree. Personalized medicine should be a critical part of any valuation analysis! Mark my words - Celgene will dominate the drug space before the decade is out.

    Firstly, many of the resultant drugs are being fast tracked because they show preliminary efficacy and are being administered to patients living under death warrants. And many are showing surprisingly positive results. The FDA system is to make sure snake oil stays out of the medical field, not to hurt people.

    The advances coming from the biotech labs around the world are simply a culmination of years of genetic and epigenetic research. Sure, there is much we don't know and it's scary being on the bleeding edge, but lives are being saved and intractable diseases are being contained.

    As to LIFE, sure, most of the tools are for labs, but labs are where this is all happening. You don't need a sequencer to administer a remedy. You need it to discover a pathway or mode of action. That's the far front end of the personalized medicine process. The other thing is having a cancer patient determine of they have a gene that helps or hurts the metabolic action of another drug.

    Ion Torrent and Illumina have done some really great stuff and are selling tools that are allowing researchers and drug companies to stop cancer. What's not to value there?

    Yesterdays drug companies were based heavily on Chemistry, and that was the best we knew at the time. Today's drug companies rely on data analysis, biotechnology, chemistry and nanotechnology. They're light-years ahead in terms of understanding of action and metabolics. It's not even the same league, from a future value perspective.
    Sep 16, 2013. 09:41 PM | Likes Like |Link to Comment
  • Annaly Capital - Bargain Or Falling Knife? Questions You Must Ask [View article]
    As to "How will the Fed taper? It buys both treasury bonds and mortgage backed securities. Given concerns over rising mortgage rates killing housing demand, and the negative ramifications that would have for the banks and consumer spending, we suspect the Fed may cut back treasury bond buying more than MBS buying. Greater treasury bond supply means higher rates, right?"

    This is indeed the most important question because it's the one where we know the least. However, 1) I doubt that the fed worries about rates killing housing demand at this point in time, 2) correct me if I'm mistaken, but QE2 is about MBS only, and 3) again, I may be mistaken, but aren't bond supply and rates offered inversely proportional?
    Sep 9, 2013. 12:02 PM | 1 Like Like |Link to Comment
  • Annaly Capital - Where Do We Go From Here? [View article]
    It would depend on whether you were a trader or investor. For Traders, short term rules. Investors take a longer view. That said, you probably could have come out slightly better if you exited and reentered perfectly. In this case, however, market overreaction made that a risky gamble.
    Sep 9, 2013. 12:46 AM | 2 Likes Like |Link to Comment
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