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PeterScriabin

PeterScriabin
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  • Petroamerica Oil: Welcome To The Cheapest Oil Producer Worldwide (Part 2) [View article]
    Jion: A household with mortgage and car loans, and card debt still keeps cash on hand to pay for daily expenses. A debtor company also keeps cash to cover short-term A/P. We can agree on that much, yes?

    But a $70m loan to pay off a $31m note, and for general corporate purposes - when one purportedly has $70m piled up in cash, and is a cash-machine (VD)? Pull the other one, it's got bells on, mate.

    You mention that other comments have already explained why a company may take a loan when they have substantial cash that could cover the loan's purposes. Yet I've read all the comments in this column, and - stap me - I missed every bloody last one of them. Would you please be kind enough to cite even ONE such post? I'm sure I'm not the only reader you would help. Better yet, just explain the reason yourself . TIA.

    For clarity, I did not accuse this company of dishonesty, or say they were like a fraudulent Chinese company. You have in common with VD, not only ESL, but either questionable reading skills, or a ready willingness to misrepresent others.

    For further clarity, I am invested in this company. It's not foolish, let alone a crime, to take on debt for profitable corporate purposes. In addition, even a company the size of Apple, recently needed an activist company to help them with Finance 101, so that is no shame for PTA either.

    I just want to know what is going on here, and I think that investors like you and VD should want to know too - instead of writing comments here that sound rather prickly or even condescending.
    Dec 1, 2014. 11:06 AM | 3 Likes Like |Link to Comment
  • Petroamerica Oil: Welcome To The Cheapest Oil Producer Worldwide (Part 2) [View article]
    VD: ah, I see; according to your testimony, first I SAID they do not have the cash, now I have only clearly IMPLIED it (emphasis mine)!

    But actually, I have done neither. I only posed the counterfactual: IF they have it, then WHY the loan? Do you yourself borrow money at a higher interest rate than you are earning on idle cash balances?

    You openly stated I set out a "...thesis that PTA does NOT have the US$70 million CASH", and challenged me to evidence it. I now challenge YOU, before anyone reading these comments, and before the SA editors, to show evidence I ever made such an assertion! You may know a lot about oil companies, but you apparently don't know much about facts or logic in debate.
    Nov 30, 2014. 01:24 PM | 8 Likes Like |Link to Comment
  • Petroamerica Oil: Welcome To The Cheapest Oil Producer Worldwide (Part 2) [View article]
    656: yes, of course, companies can have debt that it is not convenient or net-profitable to pay off, when they develop cash AFTER it was taken on. And yes, of course, it can be profitable to take on debt where the investment return exceeds the actual or imputed cost of the debt.

    But neither of those is the case before us, apparently. Why not use the cash they have developed, or are developing, to avoid taking on a NEW loan, or to pay off the 11%+ debt first (which it is claimed they wish to do)?

    I am not saying there is no good reason, or even that the Bloomberg article was necessarily correct in its assertion that they are seeking a new loan. I merely asked the question, as a potential new investor.

    And, just because this SA author lacks the financial skills or personal integrity even to address the question, in 2 mouth-flapping responses, so far, ALSO does not mean there is no good answer. But we ARE all still waiting for an answer, no matter how much ink this particular squid squirts out.
    Nov 30, 2014. 01:08 PM | 3 Likes Like |Link to Comment
  • Petroamerica Oil: Welcome To The Cheapest Oil Producer Worldwide (Part 2) [View article]
    If they have the cash, why do they need the loan?

    (By the way, everybody here, but you, knows I never said they didn't have the cash!).
    Nov 30, 2014. 11:17 AM | 3 Likes Like |Link to Comment
  • Petroamerica Oil: Welcome To The Cheapest Oil Producer Worldwide (Part 2) [View article]
    Hi Wayne - GREATLY appreciated your speculative musings, which struck me as highly plausible.

    I am especially concerned about the cash/loan situation, and recall seeing another comment - probably now behind the PRO wall - on PTAXF, to the effect that management seems to have missed the Finance 101 course.

    Either they have the cash they say they have, and should be using it FIRST, to finance profitable corporate purposes (after which it's OK to borrow, so long as the expected profit rate exceeds the loan/discount rate), or they actually do not have the unrestricted cash they say they do. If one is choosing between stupidity and dishonesty, it's maybe a red flag?

    Either way, it's all a bit reminiscent of Chinese investments I've been involved with (eg. XIN, which really seems like a good, honest company - just a bit financially illiterate). Of course, with Chinese companies, there is also exchange controls to be considered - not quite sure WHERE PetroAmerica has its cash, or whether this is relevant.
    Nov 29, 2014. 12:49 PM | 4 Likes Like |Link to Comment
  • Petroamerica Oil: Welcome To The Cheapest Oil Producer Worldwide (Part 2) [View article]
    Wayne, thanks for the link! My question is as much addressed to VD as you: from the article:

    "The company is seeking $70 million to $80 million to pay a C$35 million ($31 million) bond maturing in April and to fund production growth, Navarrete said. A share sale is not being considered. The existing notes have an 11.5 percent coupon."

    If "PTA's cash...reached US$70 million on 24th November 2014" (VD, above), why are they looking to borrow so much, to repay a US$31 million bond? I realize they are refinancing a loan at a lower rate, but the amounts seem "large".

    The Q3 results looked pretty horrible, especially compared to a year ago. Ah, production was blockaded for about 70% of the quarter, by "Marxist protesters". Are we quite sure that's all in the past?

    Adding all this to 6564051's excellent list of "reasons" (also above), I can quite understand the PPS. But every risk has its price. I agree it may be a good bet at US$0.15-0.20!
    Nov 28, 2014. 09:41 PM | 2 Likes Like |Link to Comment
  • France gets larger discount on Sovaldi than its neighbors [View news story]
    Hard to see how a $15,000 price difference, for a few small boxes, can be supported between 2 adjoining countries that belong to a union where free-trade, zero tariffs and open borders are the LAW. Even if Willy Schmidt can't just pop over into France to get his prescription filled, how would there not be middlemen to drive Harvoni over to Germany, no matter how regulated intra-EU trade in drugs notionally is?

    All I know is that Gilead is going to make a ton of money.

    Just wait for Q1 to be announced in April (emoticon = {smiles and rubs hands together, saliva drooling from edge of mouth}).
    Nov 20, 2014. 12:23 PM | 2 Likes Like |Link to Comment
  • Earnings Preview: Salesforce.com Q3 2015 [View article]
    Hi jiri: PEG = Price/EARNINGS/Growth. The revenue growth is (apparently) there. You and Jim need to explain how SFDC is going to produce EARNINGS. Costs have to stop growing as fast as revenues. Capeesh?

    Marc doesn't care about any of that, because he is cashing out millions every month - on the back of pimps like Cramer, who know (much) better, and marks like you.
    Nov 15, 2014. 10:42 PM | 2 Likes Like |Link to Comment
  • Amazon On Watch After Options Activity [View article]
    As so often, Gary, you are not reading with comprehension - whether wilfully or not, I cannot tell.

    Shorts (as opposed to long-put buyers) do not need luck or wild guesses, only that the truth is generally recognized, in the end.
    Nov 15, 2014. 05:03 PM | 4 Likes Like |Link to Comment
  • Amazon On Watch After Options Activity [View article]
    Why, Gary, this is as close to a theory of the bafflingly-bloated AMZN PPS as I've ever heard you come! Hitherto, you have ONLY pointed to the scoreboard.

    No one knows WHEN the procession-watchers will notice Mr Bezos's lack of business attire, which is why I steer clear of puts. But I am betting they notice in the end. Shorting is not inherently more expensive than going long. I can wait patiently, because this particular King has no more money for clothes, and cannot forever rely on long people, who stand up and block the crowd's view of his naked, short body.
    Nov 15, 2014. 04:06 PM | 3 Likes Like |Link to Comment
  • Amazon On Watch After Options Activity [View article]
    I covered some of my short at 280, AH after earnings, KNOWING (sic) it would soon (had not expected SO soon) be back at 320. Am now layering into more shorting, 320 through 360. Don't think it will ever return to 400, but if it does, will go ALL IN.

    The notion that Amazon is somehow disguising investment spending, that will produce GAAP profits (let alone profits that would justify a price above 200), in ANY of the Operating Expense lines is completely bogus. This story/meme suits both sides of the trade, and has done for several years now.

    Mr Bezos "has a dream", sure, but company profitability is not an important part of it. As long as he has powerful friends in the investment industry who can successfully promulgate the Greater Fool theory, the current cycle of down-on-results / up-on-dream-weaving, will continue. As long as the payments cycle and/or higher interest rates don't burst the bubble, anyway.
    Nov 15, 2014. 12:50 PM | 9 Likes Like |Link to Comment
  • Earnings Preview: Salesforce.com Q3 2015 [View article]
    Based on a paragraph (below) from the latest 10-Q, I have an open question for CRM Longs:

    WHEREAS

    . even expected non-GAAP profits yield a current P/E of approx 128 (ie. 64 / 0.5)
    . GAAP profitability is not expected, nor is there any company-delineated business model for producing same at any time in the future
    . deferred costs increase remorselessly at the same rate as, or an even higher rate than, deferred revenues

    THEREFORE - what on earth do you find compelling about holding - let alone buying more - CRM ???

    10-Q text:

    "We expect to incur net GAAP losses in the future. We have incurred net losses in each fiscal quarter except one since July 31, 2011. In addition, we expect our costs to increase as a result of decisions made for our long-term benefit, such as equity awards and business combinations. If our revenue does not grow to offset these expected increased costs, we will not be able to return to profitability and we may continue to incur net losses, on a U.S. GAAP basis, in the future."
    Nov 14, 2014. 06:07 PM | 4 Likes Like |Link to Comment
  • Gilead: Another Competitor Bites The Dust [View article]
    panamerican: Well, maybe one big reason Moderation so STATED (not implied) - is that the Obama admin stood for, nay supported, three waves of Ben helicopter QE.

    The general Republican hostility to such monetary policy was made amply clear. Even Brett stated that "The Federal Reserve has been very good for the stock market".

    You ever read Krugman? What party does he primarily support?
    Nov 12, 2014. 01:09 AM | Likes Like |Link to Comment
  • What We Learned From The MannKind 3rd Quarter Conference Call [View article]
    LforD: "a company has 40 days...do the math".

    40 days from 9/30 is 11/9, but today is still only 11/5. So what on earth are you on about??
    Nov 6, 2014. 02:19 AM | 3 Likes Like |Link to Comment
  • Why You Should Add LinkedIn Into Your Aggressive Growth Portfolio [View article]
    Marcus, your profile states you are a student in Accounting and Finance. So you might be expected to appreciate that there is a quantitative, as well as a qualitative dimension to investing. Even if LinkedIn is really the top-quality company you feel it is, with prospects to match, the question arises of whether the NPV of the likely stream of future GAAP profits is, or is not, already reflected in the current PPS. Is $2 a share good value? $200? $2000? You offer nothing to help the investor differentiate these THREE orders of magnitude.

    The main feature the neutral investor notices about LI, as the years roll by, is that no matter how fast users and revenues grow, costs seem to increase at much the same rate. The company continues to make less than 1/100 of its PPS in annual net income, even if vital elements of GAAP accounting, such as recurring SBC, are deliberately left out. In GAAP terms, the company increased its losses even in Q2, the announcement of whose results led to a 40 % PPS increase (since abated somewhat).

    Is there something about the LI business model that will likely always multiply costs as fast as revenues, such as constantly needing fresh salesmen and computer networks in order to bring in new revenue, or is this only a feature of a certain level or phase of operations? If so, why? I think you have to analyse this in thinking about LI, if only for your own good, never mind that of your readers.

    Fair disclosure: very short LI.
    Oct 21, 2014. 10:27 PM | 2 Likes Like |Link to Comment
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