Advanced Drainage Systems
Mark Haney, director at Phillips 66, bought 20,000 shares in July last year at $23 a share just in time to watch the price triple to $69.21. Well, Mr. Haney has been at it again and has just bought $188,000 worth of shares in Advanced Drainage Systems Inc. (NYSE:WMS) stock, where he also holds a directorship. The next day Director Richard Rosenthal also purchased $30,000 worth of shares in the company's stock.
Advanced Drainage Systems is the leading manufacturer of corrugated pipe and drainage solutions for the construction industry with 48 plants and 19 distribution centers in the US. The company has struggled since the great recession as public works expenditure has dried up and residential construction was postponed or cancelled. However, recent results have shown a strong improvement, with first-quarter earnings per share growth of 47% on the back of 10% sales growth. The company raised
Complete Story » By The Gold Report:
It's never too late to find a new way to evaluate mining companies and Jeff Desjardins, and James Fraser of Tickerscores.com have developed one based on over 20 different criteria. Add in some near-term catalysts and the wheat separates from the chaff. In this interview with The Mining Report Desjardins and Fraser share the names of companies with some of Tickerscores.com's highest junior mining scores.
The Mining Report: A recent article on Tickerscores.com, "The Great Divide: Inequality in Gold Juniors Means Opportunity," said: "It's clear we've reached a new level of separation between the wheat and the chaff." What does that mean for investors?
Jeff Desjardins: As the bear market has progressed, many companies have struggled to raise the necessary funds to advance their projects. Even for those that have been more fortunate, it has often come in the form of dilutive financings.
On the other hand, quality management teams
Complete Story » By Triton Research:
Alibaba (Pending:BABA) is the largest online and mobile commerce company in the world by Gross Merchandise Volume (~$251bn GMV in CY2013). However, Alibaba's disclosure doesn't provide enough detail to model the company accurately. In order to understand the company's growth potential, it helps to compare Alibaba to eBay (NASDAQ:EBAY).
At Triton Research we make growth projections based on bottom-up models of a company's operations. We think that if a model isn't bottom up, then it is made up. Given the lack of disclosure in the Alibaba S-1 and for the purpose of discussion, we looked at eBay, another global marketplace ($83.3bn GMV in CY13). Although eBay has a smaller scope and fewer businesses than Alibaba, eBay's ability to increase its revenue percentage of GMV over time paints an attractive picture for Alibaba's potential future revenue growth.
Currently Alibaba generates the vast majority of its revenue from advertising services and only
Complete Story » By Casey Hoerth:
It's been a tough week for all names in the offshore rig space, but none has had as difficult a time as Seadrill (NYSE:SDRL). In fact, since the middle of last month Seadrill had shed almost a fifth of its entire market cap. The chart below shows that while things have been tough for all offshore lessors, Seadrill has been hit the hardest.
(click to enlarge)
Chart by Yahoo! Finance
Perhaps more unsettling is the fact that most offshore lessors are now a good bit below technical 'support' levels. Ensco (NYSE:ESV), which is probably the second-best operator within this industry, has not been this low since 2012. Noble Corporation (NYSE:NE), which has only been public since its late 2013 spinoff, is at an all time low. Transocean (NYSE:RIG) is also at an all-time low. Seadrill, which is the subject of this article, has not been so low since 2011. In
Complete Story » By Dhierin Bechai:
In my previous articles, I compared the maximum configurations of the Boeing (NYSE:BA) 787 with the typical configurations of an Airbus (OTCPK:EADSF) A330neo. Scott Hamilton from Leeham Co., who did an extensive research on the A330 business model, correctly pointed out that I was comparing maximum configurations with typical configurations. Which is a comparison that is hard to justify.
In this article, I will look at typical configurations used by airlines that fly the Boeing 787-9 and the Boeing 787-8.
First, I will deal with the Boeing 787-9; after that, I will look at the Boeing 787-8.
In order to make a valid comparison, it is key to look at what configurations the Boeing 787-9 is typically operated in:
F (First Class)
C (Business class)
P (Premium Economy)
Complete Story » By Stock Market Sherpa:
Clorox (NYSE:CLX) is one of several consumer companies whose products you must likely use every day. Three years ago, the company rejected three separate bids from Carl Icahn and its shares reached a new all-time high earlier this year. Clorox has a strong history of dividend growth and currently pays 3.3%, and the stock therefore draws interest from income investors. However, due to its high debt levels, rising payout rate and questionable future dividend growth rate, investors should stay well clear of this iconic company.
Before exploring why Clorox shares seem so significantly overrated, there are a few positive attributes of the company to explore. First, its business features a number of well-known brands (Clorox, Glad, Brita, etc.) and is well-diversified by product line and geography as described on the company's website:
In addition, Clorox has used this formula well over the past 20 years to generate impressive returns
Complete Story » By Marshall Hargrave:
L Brands (NYSE:LB) reported another strong quarter, marking the fourth quarter in a row of earnings beats. Shares are on the move. But the stock is still trading at an enticing valuation. Its current P/E is a 20% discount to its historical average.
The company is a leader in the women's apparel and accessories market, as well as e-commerce channels under its five brands: Victoria's Secret, Bath & Body Works (doesn't sell apparel), La Sensa, Henri Bendel (also doesn't sell apparel), and PINK.
Its brands tend to offer upmarket products and a prime shopping experience, in return for premium pricing of course. Most of the company's revenues come from Victoria's Secret, which accounts for 67% of total revenues, and Bath & Body Works accounts for 24%. The rest come from its boutique brands.
Q2 results mark continued strength
Revenues and margins have grown nicely over the last five years, after
Complete Story » By Mark Hibben:
While the September 9 event was a triumph for Apple (NASDAQ:AAPL) and the stewardship of Tim Cook, it marked a setback for GT Advanced Technologies (NASDAQ:GTAT). Since September 8, GTAT has fallen about 30%, merely as a consequence of Apple not using sapphire in iPhone 6. How the expectations of investors and Apple fans everywhere become so disconnected from reality is a question that I feel deserves more consideration than I've given it up until now.
The Big Promise
When the GTAT/Apple deal was announced last year, I immediately thought of what was then called iWatch. Sapphire had long been used for watch crystals, and I took this as a sign that iWatch was on its way. But almost immediately, focus in the media shifted to iPhone. iWatch was still an unknown quantity with an unknown market potential, whereas iPhone was Apple's flagship product producing roughly half of Apple's revenue.
Complete Story » By SA Transcripts:
Smiths Group Plc (OTCPK:SMGKF)
Annual Results 2014 Earnings Conference Call
September 17, 2014, 04:00 AM ET
Philip Bowman - Chief Executive
Peter Turner - Finance Director
Jeff McCaulley - President, Smiths Medical
Richard Ingram - President, Smiths Detection
Duncan Gillis - President and Chief Executive Officer, John Crane
Michael Herlihy - Interim General Counsel
Silvio Bracone - Group Strategy Director
Tedd Smith - Chief Executive Officer, Flex-Tek
Martin Wilkie - Deutsche Bank
Alex Toms - Bank of America-Merrill Lynch
Matt Spurr - Espirito
Mark Davies Jones - Agency Partners
Jon Mounsey - Exane BNP Paribas
Sash Tusa - Edison
Nick Wilson - Espirito
Andrew Carter - RBC
Sean McLoughlin - HSBC
Robert Davies - Morgan Stanley
Ladies and gentlemen, good morning, and welcome to the 2014 Annual Results Presentation for Smiths Group. Before I begin, can I just, as usual, remind you that activation of
Complete Story » By ValueWalk:
By Aman Jain
Oracle Corporation (NYSE:ORCL) will report its first-quarter 2015 earnings in a conference call on September 18. The company has not performed very well in terms of earnings over the past several quarters, and that will not change in the upcoming quarter results as well, believe Cantor Fitzgerald analyst Brian J. White in a report dated September 16, 2014.
Analyst expects potential upside
"Trading at just under 12x our FY15 EPS estimate, with an operating margin profile that is 1.5-2x other leading IT vendors, the stock, in our view, has attractive upside potential over the next year as reflected in our $50.00 price target," notes White.
Analyst expects Oracle will marginally miss the first-quarter 2015 revenue estimates of $8.79 billion (and consensus is at $8.77 billion) and perform in line with the EPS projection of $0.64 (Street also expects $0.64). Revenue is expected to drop 22% quarter on
Complete Story » By Sramana Mitra:
Many analysts believe that flash sales sites are a passing fad. But, if one looks at players like Zulily (NASDAQ:ZU) and Gilt Groupe, that may not be true. By identifying a niche market space, addressing the target demographic and carefully selecting products to put on sale, both Zulily and Gilt Groupe have become the poster children for flash sales sites.
Seattle-based Zulily recently announced their second quarter results, which were significantly ahead of the market's expectations. The company reported revenue growth of 97% over the year to $285 million, compared with the Street's target of $272 million. EPS of $0.06 was also ahead of the market's estimated earnings of $0.04 per share.
Among operating metrics, active customer base improved 86% over the year to 4.1 million and the total number of orders placed grew 92% to 5.4 million. Average value per order inched 1% upwards to $53.85.
Complete Story » By Gloves Off Investing:
GameStop (NYSE:GME) has benefited this year from the introduction of the next generation of video game consoles, Sony's PlayStation 4 and Microsoft's Xbox One (NASDAQ:MSFT). However, software sales are weak, and we are concerned that the shift to digital will generate ongoing headwinds for some time at GameStop and other video game retailers. .
Digital Long-term Threat to the GameStop's Business Model
While we are not ready to say that video game retailers go the way of Blockbuster, the threat is there. Digital sales represent a clear threat to the business model for both new and used game sales. Consumers continue to buy and consume more media content online and video games are just the latest to start seeing an accelerating shift to digital.
Full-title Digital Sales will Increase, Negative for Sales at GameStop
Consumers are increasingly downloading video game titles digitally and not buying the physical games. The publishers
Complete Story » By Stephen Simpson, CFA:
Continuing my run through Brazilian commodity companies that have had disappointing results this year, I come to Braskem (NYSE:BAK) - Brazil's large polyolefin and PVC producer. Like the steel companies Gerdau (NYSE:GGB) and CSN (NYSE:SID), Braskem has underperformed in the face of weakening domestic demand and fears that the Brazilian national election could bring in a government less supportive of the structural barriers that allow them to charge higher prices in Brazil.
I liked Braskem six months ago and I still believe the shares are undervalued. Even amidst an underwhelming domestic market, the general expectation is that Braskem will still see year-on-year EBITDA growth in the high single-digits for 2014 and double-digit growth in 2015. What's more, I think Braskem is looking at a window of opportunity (before major cracker project start-ups in the U.S.) where its naptha-based production can still be quite profitable. There's a not-so-fine line between being
Complete Story » By John M. Mason:
As long as investors believe that the Federal Reserve is not going to tighten up on monetary policy, they will continue to keep stock prices moving on up.
Today, September 17, 2014, the Federal Reserve did not disappoint them…at least that was the interpretation put on information coming out of the meeting of the Fed's Open Market Committee.
After the results of the Fed's meeting were announced, by 3:00 pm the S&P 500 index rose above 2,010 and the Dow Jones index went above 17216 both new records.
Certainly the conclusion one can draw from this behavior is…go with the flow of the Fed!
The question is, what is all these new stock market records getting us?
They are certainly not getting us faster economic growth. In fact, the projections of the Federal Reserve Board Members and the Federal Reserve Bank Presidents give us the following range of projections for
Complete Story » By Eli Inkrot:
If you're talking about cereal, you're likely referring to the Kellogg Company (NYSE:K) or General Mills (NYSE:GIS). These two companies control roughly 60% of the market and their collective brands hold 9 of the 11 most popular cereal spots. Sure, there's an occasional guest appearance by Post (NYSE:POST) and Quaker (NYSE:PEP). Additionally, it's possible that you buy the store brands from Wal-Mart (NYSE:WMT) or Target (NYSE:TGT). However, when you think of cereal, you're likely conjuring up images of Cheerios, Special K, Frosted Flakes, Lucky Charms, Frosted Mini Wheats or Cinnamon Toast Crunch (these 6 names represent roughly a third of cereals sold).
What's important about this ideology is that these brands are sold at a hefty premium to their generic counterparts -- similar ingredients, bigger price tag. As an investor, this translates to continuous and lasting profits. So, if you have a limited amount of capital to allocate, which would
Complete Story » By Matthew Sauer, Esq.:
Multi-asset ETFs offer investors diversification within a single ETF. Stocks, bonds, preferred stock, REITs, MLPs and commodities are some of the assets that can be found in a multi-asset fund. These funds are attractive to investors due to the promise of diversification and sometimes high yields, but investors need to dig into the details to figure out how the fund is constructed.
Guggenheim Multi-Asset Income (NYSEARCA:CVY) is the oldest of the multi-asset ETFs, launched in September 2006. With $1.3 billion in assets, it can also claim to be the largest multi-asset ETF, ahead of First Trust Multi-Asset Diversified Income (NASDAQ:MDIV), but does it deserve the label?
Index & Strategy
CVY tracks an equity index, the Zacks Multi-Asset Income Index. The index aims to beat dividend indexes such as the Dow Jones Select Dividend Index on a risk-adjusted basis. Holdings may include U.S. common stock, preferred stock, ADRs, REITs, MLPs, closed-end
Complete Story » By Hard Asset Investments:
Sandstorm Gold (NYSEMKT:SAND), a gold streaming company that provides upfront financing for mining companies that are looking for capital, recently presented at the 2014 Denver Gold Forum, which is the world's largest single gathering of precious metal equities. The company's CEO Nolan Watson gave a 20-minute presentation which updated current and prospective investors on the company's portfolio of assets, its balance sheet, growth potential, reduction of G&A expenses, and expectations for the future.
In my first article on Sandstorm, I argued that the company is basically a free cash flow machine that should outperform its peers for a few reasons. One, since the company is much smaller than peers Franco Nevada (NYSE:FNV), Silver Wheaton (NYSE:SLW) and Royal Gold (NASDAQ:RGLD), the company only needs to complete a few small deals to "push the needle" - just a $20-$30 million stream could result in significant value creation. Next, the company had $110
Complete Story » By Alex Cho:
Adobe (NASDAQ:ADBE) reported earnings, and I guess the top line figure just barely missed by a narrow sliver of a margin. The company reported $1.005B versus the consensus analyst estimate of $1.02B. The difference in the actual figure from the consensus was a whopping $15 million for the quarter.
Going into 2014, this was one of my better performing recommendations, and as you can tell from the below chart, it has had quite a bit of a ride.
(click to enlarge)
As you can tell, the stock has rallied for most of 2014. The stock started to decline in the middle of the year, but it eventually moved up into the $70-$73 range. However, the stock started to consolidate, as there weren't a whole lot of catalysts that could drive the stock much higher.
Earlier in the year here's what I stated:
For calendar year 2014, I offer
Complete Story » By David Merkel, CFA: Photo Credit: DonkeyHotey July 2014 September 2014 Comments Information received since the Federal Open Market Committee met in June indicates that growth in economic activity rebounded in the second quarter. Information received since the Federal Open Market Committee met in July suggests that economic activity is expanding at a moderate pace. This is another overestimate by the FOMC. Labor market conditions improved, with the unemployment rate declining further. However, a range of labor market indicators suggests that there remains significant underutilization of labor resources. On balance, labor market conditions improved somewhat further; however, the unemployment rate is little changed and a range of labor market indicators suggests that there remains significant underutilization of labor resources. More people working some amount of time, but many discouraged workers, part-time workers, lower paid positions, etc. Household spending appears to be rising moderately and business fixed investment is advancing, while the recovery in
Complete Story » By The Investment Doctor:
Sable Mining (OTC:SBGGF) which aims to develop its Nimba iron ore project in Guinea has released an update on its activities there. A maiden reserve estimate was completed which contained almost 54 million tonnes of iron ore at an average grade of 61.6% Fe, which means this ore is direct shippable. The total resources stand at almost 182 million tonnes at a grade just short of 59% Fe. The pre-feasibility study indicated the project could be brought into production for an initial capital expenditure of less than $300M, and would have a 25 year mine life using a base case production rate of 3 million tonnes per year. It's the company's expectation this mine life could be extended as there still are several unexplored targets on its land package.
The company is still hopeful to bring the Nimba project in production by 2016, but I think this is a bit
Complete Story » By Marc Chandler:
The FOMC statement was little changed from July. It reiterated that there was "significant" slack in the labor market, despite continued improvement. It repeated that rates would likely remain low for a "considerable" time after the end of QE. It also again indicated that even after the Fed's employment and price objectives were neared, Fed funds would likely remains below the "normal" long-run level. The Fed's economic assessment saw minor tweaks recognizing the ongoing improvement of the economy.
This is largely in line with our expectations and more dovish than the market expected. However, the quick knee jerk reaction read the statement hawkishly. First there were two dissents: Plosser and Fisher. The objections were over the forward guidance. They did not advocate an immediate rate hike (as the two dissents from the Bank of England).
Second, the Fed's dot plot saw a small increase in the Fed funds at the
Complete Story » By ValueStreet Research:
Let's say you had $10,000 to buy a 100% stake in a private business. Would you rather invest your $10,000 in:
- A business with $100 in revenue and no earnings in a brand new, unproven industry but that is growing extremely quickly?
- A business with $17,000 dollars in revenue and $1,000 in earnings with a significant track record growing significantly less quickly?
I would venture a guess that most rational people would choose the second. However, in the market, such rationalities do not apply. Mobileye (NYSE:MBLY), a company I recently did a write up on, is a perfect example of the first type of company whereas TRW Automotive Holdings (NYSE:TRW) is a perfect example of the second. Both are manufacturers of car parts and trade for valuations of around $11B. Yet TRW has a proven track record, $17B in revenue at $1B in net income and investors can
Complete Story » By WhisperNumber:
ConAgra Foods Inc. (NYSE:CAG) is expected to report earnings on Thursday, September 18th. The whisper number is $0.37, two cents ahead of the analysts' estimate and showing confidence from the WhisperNumber community. Whispers range from a low of $0.35 to a high of $0.39. ConAgra has a 62% positive surprise history (having topped the whisper in 26 of the 42 earnings reports for which we have data).
- Beat whisper: 26 qtrs
- Met whisper: 1 qtrs
- Missed whisper: 15 qtrs
Our primary focus is on post earnings price movement. Knowing how likely a stock's price will move following an earnings report can help you determine the best action to take (long or short). In other words, we look at what happens when the company beats or misses the whisper number expectation.
The table below indicates the average post earnings price movement within a one and thirty
Complete Story » By Nicholas Pardini:
Singapore has been a beacon of economic stability and effective policy in Asia for decades. Along with its strategic location, this status has allowed the city state to become the center of trade, financial services, and professional services for Southeast Asia.
However, social tensions related
Complete Story » By Benzinga:
The gold bugs received some dire news this week, as the two largest consumers of the precious metal announced a significant decline in second quarter purchases.
China cut its gold purchases by about 50 percent from a year ago, while India cut their purchases by nearly 40 percent. This is significant because the two countries together account for more than 70 percent of the global demand for gold.
In the past, unstable geopolitical landscapes similar to today have been a positive catalyst for gold, as it was perceived a safe haven investment. Investors appear to be betting that political tension in the Middle East and Ukraine will not escalate much further.
A strong U.S. dollar is also responsible for a fall in the value of gold. Historically, gold and the U.S. dollar move inversely to each other. This is due to gold being priced in
Complete Story » By SA Transcripts:
Apogee Enterprises, Inc. (NASDAQ:APOG)
Q2 2015 Earnings Conference Call
September 17, 2014 10:00 ET
Mary Ann Jackson - Investor Relations
Joe Puishys - Chief Executive Officer
Jim Porter - Chief Financial Officer
Samuel Eisner - Goldman Sachs
Brent Thielman - D. A. Davidson
Jon Braatz - Kansas City Capital
Colin Rusch - Northland Capital Markets
Good day, ladies and gentlemen, and welcome to the Second Quarter 2015 Apogee Enterprises Incorporated Earnings Conference Call. My name is Juanita and I will be your operator for today. At this time, all participants are in a listen-only mode. We will be facilitating a question-and-answer session towards the end of this conference. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes.
I would now like to turn the conference over to Ms. Mary Ann Jackson. Please proceed.
Mary Ann Jackson
Thank you, Juanita. Good morning and
Complete Story » By IAEResearch:
The relationship of a supplier and the manufacturer is interesting in the business world - success of one entity sometimes ensures the success of the other. However, at the same time, some decisions from the manufacturer can have deep impact on the supplier. GT Advanced Technologies (NASDAQ:GTAT) is a supplier to a number of manufacturers. However, the most important of these manufacturers up until now is Apple (NASDAQ:AAPL). We have seen how a negative piece of news from the manufacturer can impact the supplier - GTAT has been in a free fall since the announcement by Apple about its new products and the fact that sapphire has not been used for major products by the company. GTAT stock has fallen 33% since Apple announced its new products, showing that the impressive price movement over the last few months had been based on the expectation that GTAT will be a major
Complete Story » By Daniel Jones:
Shares of General Mills (NYSE:GIS), one of the world's largest consumer foods companies, dropped around 4% on Sep. 17 after news broke that the business's revenue and earnings for the first quarter of its 2015 fiscal year came in lower than expected. According to its press release, revenue was $4.27 billion. This represents a more than 2% decline compared to the $4.37 billion seen in last year's quarter and missed the $4.38 billion analysts anticipated. Based on the data provided, the sole contributor to this drop in sales was the business's U.S. Retail segment, which saw its top line fall 5% as price realization, product mix, and lower volume hit the company where it hurts.Earnings Overview Last Year'sForecastedActualRevenue (billions)$4.37$4.38$4.27Earnings per Share$0.70$0.69$0.55
From a profit standpoint, the picture was even worse. For the quarter, General Mills reported earnings per share
Complete Story » By WhisperNumber:
Rite Aid (NYSE:RAD) is expected to report earnings on Thursday, September 18th. The whisper number is $0.06, in line with the analysts' estimate and showing neutral confidence from the WhisperNumber community. Whispers range from a low of $0.05 to a high of $0.08. Rite Aid has a 48% positive surprise history (having topped the whisper in 22 of the 46 earnings reports for which we have data).
- Beat whisper: 22 qtrs
- Met whisper: 1 qtrs
- Missed whisper: 23 qtrs
Our primary focus is on post earnings price movement. Knowing how likely a stock's price will move following an earnings report can help you determine the best action to take (long or short). In other words, we analyze what happens when the company beats or misses the whisper number expectation.
The table below indicates the average post earnings price movement within a one and thirty trading
Complete Story » By Richard Shaw:
In this Bull market lower-quality, lower-yield stocks have been outperforming higher-quality, higher-yield stocks. Earnings growth has been rewarded, but perhaps not with sufficient distinction between long-term sustainable growth and unsustainable earnings growth.
It is important to distinguish between earnings growth coming out of a depressed earnings recession and with low labor and interest costs that cannot be perpetuated in the long term, versus earnings that are not based on low interest rates, depressed labor rates or climbing out of an earnings slump without supporting revenue growth.
If you are a momentum follower, that may be just so much "so what". If you are focused on high quality, above-average yield, consistent revenue and dividend growth, and reasonable price for growth; then you have to turn over a lot of data. This filter is one of many approaches you might employ to uncover potential opportunities.
The elements of quality tend to persist
Complete Story »
Exelis (NYSE:XLS) was spun out of ITT Corporation back in 2011 and is their defense segment that provides C4ISR (command, control, communications, computers, intelligence, surveillance and reconnaissance) information systems and technology services to the government, mainly the defense department as well as some commercial customers globally. They make also hard products like night vision goggles and mine detectors.
This is another of those spin-offs where companies break off the piece that is underwhelming to allow the more attractively placed businesses to flourish. Within Exelis, there will now be another spin-off where the company will break-out their poorer performing mission services segment into a new firm called Vectrus. This piece will be just their defense electronics business, mostly servicing the Department of Defense.
Exelis essentially produces and services mission critical systems within the Defense Departments surveillance, electronic warfare, and information and cyber security, and networked communications areas. There are
FireEye, Inc. (NASDAQ:FEYE) is a provider of cyber security solutions. Their solutions are used in the detection of unknown, highly sophisticated malware, and persistent attacks. Management has been rapidly growing operations and revenue. They have increased their sales and support reach from a few countries to over 65 countries and nearly 2500 customers. FireEye's revenue growth has been staggering. Revenue has grown from $1.6 million in 2009 to $161.6 million in 2013 or at a CAGR of 215.0%. This rapid growth is expected to continue in 2014. Revenue is expected to grow 161.8% y/y. Although revenue has grown fast, operating expenses have actually grown even faster. From 2009-2013, total operating expenses increased at a CAGR of 329.3%. The rapid rise in operating expenses has resulted in larger and larger operating losses. The company's operating loss in 2013 was $120.6 million. In the first half of 2014, operating losses have already
Mason Graphite (OTCQX:MGPHF) shares have risen 30% in the past couple of months as investors have once again become interested in the graphite space. Mason Graphite in particular has garnered investor enthusiasm with its large resource expansion announced towards the end of last year as well as with support from infamous commodities investor Jim Rogers. Bulls like the fact that the company's Lac Gueret Project is very high grade, and the fact that it is enormous.
But unfortunately that is not the whole story. Mason Graphite has a few problems that should make investors hesitant to choose this as their preferred bet on the exciting graphite space. These problems include:
- The remoteness of the Lac Gueret Project
- The fact that the Lac Gueret Project has the least amount of large flake graphite of the major graphite producers.
- The outdated price assumptions used in the Lac Gueret PEA which don't reflect
PDC Energy (NASDAQ:PDCE) has done alright since January of this year, even though concerns remain about the quality of the company's acreage and opportunity in the Utica. These shares have risen about 15% over that span - not bad relative to the group (as measured by the EPX), but inferior to other Wattenberg operators like Bonanza Creek Energy (NYSE:BCEI) and Synergy Resources (NYSEMKT:SYRG) and more diversified operators like Whiting (NYSE:WLL). While these shares still appear to be undervalued, concerns about rising unit LOEs, litigation, and inconsistent Utica drilling results may all remain as headwinds and/or risk factors for the shares.
Wattenberg - Dialed In And Delivering
PDC Energy is the third-largest Wattenberg operator (behind Noble (NYSE:NBL) and Anadarko (NYSE:APC)), with around 97,000 net acres prospective for the Niobrara and Codell formations. PDC Energy has largely delineated its acreage (97% held by production), but the company still has a potential
Early last year I wrote a post describing the illusion of "passive investing". In essence, there is no such thing because not a single one of us can replicate a totally passive index without making timed contributions, distributions, rebalancing, etc. I think the idea of "passive" investing is largely a marketing pitch sold by firms who do something that is generally a less "active" form of investing and this alternative perspective is constructed in order to draw a line in the sand thereby creating the illusion that less active forms of investing are something totally different from anything more active.
The whole idea of "passive" investing is obviously flawed though. It's just marketing jargon. As Rick Ferri, one of the undisputed kings of indexing, recently noted, we are all active to some degree. But more importantly, anyone constructing an index based approach is essentially engaging in a form
By IMD Professor Carlos A. Primo Braga
Once again Argentina is in the eye of a sovereign debt storm, having defaulted on July 30th for the second time in the 21stcentury. This Argentinian default is different to the previous one in 2001 and may have substantive systemic implications. Hopefully it will lead to a fresh look at the idea of a sovereign debt restructuring mechanism.
In December 2001, Argentina was in the midst of a dramatic macroeconomic crisis. Its Convertibility Plan – an exchange-rate-based stabilization program introduced in 1991 – unravelled, leading to the largest sovereign debt default in history. At that time, Argentina owed $9.5 billion to the IMF, $6.3 billion to the Paris Club of official creditor nations, and $81.8 billion (face value) to private bond holders. One can always debate whether a default is driven by unwillingness or inability to pay. But it is clear
By IMD Professor Arturo Bris
This month Mexico signed substantial reforms into law.
“Mexico’s reform agenda is now complete. Eleven structural reforms were passed by congress over the past 20 months. [These] reforms intertwine in a single goal: to increase Mexico’s productivity and competitiveness,” wrotePresident Enrique Peña Nieto in the 20th August edition of the Financial Times.
In the aftermath of the crisis that started in 2009 Mexico has engaged in a massive program of meaningful economic and social reforms. Its economic performance in the past two years has been relatively good and the success of the trade agreements with its two North American partners is unquestionable.
So how did Mexico slip to 41st out of 60 countries in the 2014 IMD World Competitiveness Rankings, down from 32nd in 2013?
Although Mexico has taken a step in the right direction with its recent reforms, there are
The concept of value investing is very simple; buy assets for less than they are worth. The larger the discrepancy between price and value, the bigger the margin of safety. Intuitively, value investing makes sense. Not only does it make sense, it creates high returns.
Numerous studies have shown that buying assets for less than they are worth creates excess returns. The image below shows the performance of an equal weighted portfolio of the value decile (10% of stocks with lowest P/B) of stocks compared to the glamour decile (10% of stocks with highest P/B). A 20% CAGR over the period from 1926 to 2013 is nothing short of amazing.
(click to enlarge)
Don't Get Too Excited - Value Stocks Are Scary
Value investing is simple, but not easy. Stocks trading at a discount to their assets usually do so for a reason; because there are serious problems
By IMD Professor Arturo Bris
In the summer of 2008, the US financial sector suffered one of the most damaging events in its history. The volatile stock market, induced by the subprime market, led to the default of Lehman Brothers, and subsequently to a massive global crisis.
We are now in a post-crisis period. Yet, looking back to between 1945 and 2008, we see that the frequency of financial crises and recessions is quite high: on average, there is one crisis every 58 months (using data from the US National Bureau of Economic Research). In other words, statistically speaking we should expect the beginning of the next crisis in April 2015, which would end by March 2016. So are we in a post- or a pre-crisis period?
I do not want to be the bearer of ill tidings, but I think we should always wonder what the cause of the
Before the market opens on Aug. 27, Tiffany & Company (NYSE:TIF) will report revenue and earnings for the second quarter of its 2014 fiscal year. In recent years, the business has done particularly well, as has rival Signet Jewelers (NYSE:SIG), but are the expectations held by analysts too much for management to deliver on?
Revenue hopes are high… but not so much on profits
For the quarter, Tiffany is expected to report revenue of $987.86 million. If this forecast turns out to be accurate, it will represent an almost 7% jump in sales over the $925.88 million management reported the same quarter a year earlier. Given the specialty retailer's long-term performance, this growth will likely come from a combination of higher comparable store sales and an increase in store count.
Earnings PreviewLast Year's Forecasted Revenue (millions) $925.88 $987.86 Earnings per Share $0.83 $0.85
Although sales expectations are high, Mr.
The American consumer loves to spend $
Self-indulgence seems to know no bounds among US consumers. When coupled up with a national favorite beverage, single-serving coffee-makers became the current must-have, putting Mr. Coffee among the unemployed. Young consumers can't be seen doing anything the old, 20th century way. Hang the increased cost, this is now!
The evident read of Keurig Green Mountain's (NASDAQ:GMCR) new higher-priced line by professional portfolio managers was a dramatic thumbs-up, as seen by market-makers elbowing one another to get more stock to fill client volume buy orders. But the pace of the trading day had little suggestion of a feeding frenzy.
From the start it was obviously going to be a big up-day for GMCR, and the lack of any end-of-day liquidation of floor inventory suggests there may be more tomorrow.
Here is how the Market Makers have been seeing GMCR's stock price prospects, based on
Book Review: Rare Earth Elements - A New Approach To The Nexus Of Supply, Demand And Use By Volker Zepf
Recently I had the opportunity to read Volker Zepf's PhD. thesis: Rare Earth Elements--A New Approach to the Nexus of Supply, Demand and Use: Exemplified along the Use of Neodymium in Permanent Magnets. It was recommended to me by a contact at a rare earth element (REE, hereon) junior mining company. Ironically, the thesis of the work questions the popular bullish narrative that drove prices higher back in 2010-11 and which keeps the bullish spirit alive during the recent bear market. While the author certainly has no intent to argue a bearish case, his goal is to point out how little we really know regarding the supply/demand dynamics of the REE market.
The work has 8 chapters the author achieves three things for the reader. First, he gives an overview of the REE market. This part of the book is actually very similar to the standard narrative that we
On August 21, 2014, GameStop Corp. (NYSE: GME) reported 2Q 2014 earnings of $24.6 million or $0.22 per share on sales of $1.73 billion compared to earnings of $10.5 million or $0.09 per share on sales of $1.38 in the same period in the prior year. These estimates were above Estimize-reported consensus estimates of $0.19 per share on sales of $1.66 billion. These figures are based on a diluted share count of 114.3 million in 2Q 2014 and 119.2 million in 2Q 2013.
GameStop Corp. is a retailer for video games and consumer electronics and wireless services. The company's main products are new video games (28.7% of sales, 23.3% gross margin), new video game hardware (19.2% of sales, 9.5% gross margin), used video game products (32.2% of sales, 47% gross margin), video game accessories (6.2% of sales, 39% gross margin), digital video game sales (3% of sales, 65% gross
As earnings approach on Aug. 26, some investors holding shares of Best Buy (NYSE:BBY) are likely kicking around what to do with the specialty retailer's shares. While the fact that shares are currently trading at a 30% discount from their 52-week high might imply that the business is an attractive prospect, the company's operating history in recent years suggests that investors might want to be very cautious before committing to a stake in the business.
Analysts are expecting disappointing results
For the quarter, analysts anticipate that Best Buy will report revenue of $8.99 billion. Should this forecast turn out to be true, it will represent a 3% drop in sales, compared to the $9.30 billion management reported during the second quarter of its 2014 fiscal year. Based on the company's recent operating history, any decline in revenue will likely be driven by lower comparable store sales, combined with a drop
On August 21, 2014, Sears Holdings Corp. (NASDAQ: SHLD) reported a 2Q 2014 adjusted-loss of $2.87 per share on sales of $8.0 billion compared to an adjusted loss of $1.56 per share on sales of $8.9 billion in the same period last year. Including special items, Sears' 2Q 2014 loss was $5.39 per share compared to a loss of $1.83 in the same period last year. These figures are based on a diluted share count of 106.3 million for 2Q 2014 and 106.1 million for 2Q 2013.
Sears Holdings is a retailer in the United States and Canada. The company owns retail stores that sell products branded under the Sears, Kmart, Kenmore, Craftsman, and Diehard labels. The company currently operates over 1900 stores in the United States and 449 stores in Canada.
- Business model transformation is centered around membership and promotional models
- $839 million in cash
EnerSys (NYSE: ENS) is an industrial battery company with a market capitalization of almost $3 billion. The under-followed company rarely has more than 5 or 6 analysts featured on their earnings call, and hasn't had a focus article published on Seeking Alpha since July of 2012. The company splits products into two main categories. Reserve power products serve as backup power for critical systems and applications such as large scale energy storage, telecommunications, security systems, other computer controlled systems, and much more. Their motive power products provide power for industrial forklifts. The company also offers some products to the aerospace and defense market. EnerSys reports revenue geographically by three regions: the Americas, EMEA, and Asia. The respective revenue shares are 47%, 44%, and 9%. Founded in 1999, the company has 9,500 full-time employees. In the past ten years, growth has been exceptional and consistent.
The construction schedule for Constitution Pipeline, which is an important element of Cabot Oil & Gas' (NYSE:COG) growth strategy in the Marcellus, is slipping by another two months. The final environment impact statement ("EIS") by FERC that was anticipated this month is now expected by October 24, 2014, which is a second two-month delay relative to the original schedule. The slippage is a result of changes to the pipeline's routing that likely reflect local opposition in certain areas and Constitution's decision to consider alternative paths on several segments.
After the final EIS is issued, it may take another three months for the Federal Authorization Decision to be obtained.
The delay makes the in-service date for Constitution Pipeline most likely a mid-2016 event, assuming no additional delays. The risk of additional slippages, however, exists, given the complexity of the permitting process in the Northeast region and frequent activism by local communities
No, I am not a serial writer about Halcon Resources (NYSE:HK). Few Halcon's bulls have claimed the opposite, but it is very easy to confirm that they are absolutely wrong, if you check out my previous articles. Believe me, there are other fellow SA contributors who have written more articles about this company than me.
But short selling Halcon has been a serial profitable play since my first bearish article back in early 2013, when Halcon's stock was at approximately $8, as shown below:
(click to enlarge)
Key Metrics Update
Now that Halcon's Q2 2014 report is out, let's take a look at some key points:
1) The Net Debt (including the working capital deficiency) was $3.67 billion in June 2014.
2) The President commented: "Second quarter results were solid and reflect our ongoing efforts to maximize returns. We believe we are well positioned to continue delivering strong
On Thursday, The Fresh Market (NASDAQ:TFM) reported quarterly earnings that were better than what analysts (with their low bar) had been thinking, which took the stock up in the after-market. But, I think the move has more to do with the low bar that had been set and the high short interest (>30%) in the stock. Overall, the company is facing greater completion from its peers (all with aggressive real estate growth targets) which will weigh on comps for the remainder of the year. It seems like the company's business model is about to shift - from a nationwide healthy grocer to a regional grocer than focuses on specialty items such as meats. Estimates and growth targets for the company now look somewhat aggressive, but its above-average growth going forward seems to be realistic compared to the multiples the company trades at.
Competition Weighs on Performance
The biggest takeaway I
Fabrinet (NYSE:FN) provides optical packaging and precision optical, electro-mechanical and electronic manufacturing services to original equipment manufacturers (OEMs) of complex products, such as optical communication components, modules and sub-systems, industrial lasers and sensors. Basically, the business creates specialized products for other businesses that delve into a variety of end-markets such as biotech, automotive, semi-conductor processing, and so forth. The company was founded in 1999 and began operations the following year. They are based within the Cayman Islands.
Another SA author revealed that Fabrinet holds a decent market share figure in this particular industry. Management states within their 10-K report that the area holds a default competitive advantage: "there are significant barriers to entry in our existing and target markets, including the lengthy sales cycle, the need to demonstrate complex precision optical and electro-mechanical engineering and manufacturing capabilities to a prospective customer and the ability to protect a customer's intellectual