plato1976
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Posts posted by plato1976
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Too many names flying around
Each has a unique profile: debt level, reserve, asset quality and potential
Need time to sort out
No position yet
So, how many of you actually own some Canadian oil producers here?
For those who don't, why?
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Does Lukoil have a similar or lower cost for its reserve compared with BP ?
I heard BP has some of the lowest cost reserves
I think Lukoil is a strong competitor. A great company in a hated country. If the company was valued at $9.00 per BoE (the same valuation as BP) this is more than a 3x upside. There is a good thread on this in the Stocks section.
Packer
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I am curious why suddenly everyone is comfortable with LTS 's plan ;
Seems it still has no plan to deleverage, be conservative and realize value
So it's just b/c it's cheap enough now ?
LTS
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why is it VERY risky ?
Right now I'm torn between DOX and QCOM. That being said, I dont expect either of these to go up 100%, but do well over the long term.
Both trade at high FCF yields, DOX has heavy buybacks and QCOM has high rates of growth.
Qcom is very risky, I just sold all my holdings a few months ago
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The past few months CHK has been very quiet at the divesting frontier
I hope CHK can clean up its balance sheet asap and move on
CHK - The company is shedding non-core assets, cleaning up the balance sheet (both in terms of total debt level and complexity) and will finally not outspend operating cash flow (or come very close to not outspending) in 2014. At some point in 2014, there will likely be visibility into FCF production in 2015. I wouldn't be shocked to see further cost cutting and layoffs as well as higher productivity and lower costs as the company moves from building new pads and holding acreage by production to drilling lower cost wells from existing drill pads.
Big potential upside if they sell a predictable long-lived asset like the Barnett shale to someone with a low cost of capital (like an upstream MLP). Rising gas prices from a cold winter make this more likely.
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As for QCOM, when do you think their patent will have a cliff ?
Looks like we cannot project their current earning power into infinity b/c 2/3 of their profits are from patent fees. However, the current share price doesn't count on this either.
Right now I'm torn between DOX and QCOM. That being said, I dont expect either of these to go up 100%, but do well over the long term.
Both trade at high FCF yields, DOX has heavy buybacks and QCOM has high rates of growth.
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I have certainly been a little bit lucky this year. I feel my timing in 2013 was the best in the past 4-5 years. In fact I am still quite a newbie in investment even though I have been actively and seriously managing my own money for 8 years. Compared with many highly experienced and knowledgeable ppl in this forum, I owe my performance to one simple word: copycat .
Looking backward, I may have been too conservative. I was aware of the market danger before 2008, and therefore I went into 2008 with a huge cash position and exited it unscathed. But I was way too bearish that I missed the bottom in 2009. I began to build position again in late 2009. My performance has been very mediocre in those bullish years. Looking backward, I was never caught in a crash (China in 2007, US in 2008), but my problem is I was way too pessimistic. Saying so, I feel reluctant to reduce my current cash position of 30%+ . I never systematically thought about the cash management like you guys in a scientific way although I am a scientist - I just keep a cash position large enough to make myself comfortable. I hope next time when the panic comes I will be brave and smart enough to deploy my cash - it's easier to say than to do.
Plato,
That's pretty impressive with that much cash. I'll bet you sleep quite well at night. If you're doing 40%/year, you can afford a few points a year given your ability to sleep at night. During 2008/2009, did you go from holding cash to fully invested? What's the composition of your invested capital going into 2008/2009? There was a lively thread about the merit of holding cash versus not holding cash. If you were to average all your returns together, did holding cash help or hurt in the long run?
40% with 1/3-1/2 in cash all the year
I guess I have been too conservative
But I guess I have always been very conservative
never really got caught in a bear market including 2008, but never really had a stellar year (sth like 100%...)
need to live with my personality
104% in my IRA YTD 2014, 24% CAGR in my IRA since June 2009
For 2014, mostly concentrated market neutral workouts and special situations.
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40% with 1/3-1/2 in cash all the year
I guess I have been too conservative
But I guess I have always been very conservative
never really got caught in a bear market including 2008, but never really had a stellar year (sth like 100%...)
need to live with my personality
104% in my IRA YTD 2014, 24% CAGR in my IRA since June 2009
For 2014, mostly concentrated market neutral workouts and special situations.
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Wondering if anyone is nice enough to share a list of good posters on vic
VIC is a good place to learn how to value companies in various industries, analyze capital structures and decipher footnotes. The really good posters are just a handful and it would be wise to hear what some of these guys are thinking.
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Consumer brand , esp something you need to put into your mouth
Finance - esp banks with big deposit base, and good asset management company
Business service (no IBM, pls)
Technology. So many great companies.
Thoughts on XPEL and FLIR?
Im not sure about the moats of both. If their moats are at least v decent then these companies are set up to gain a v nice market share of an industry that has some massive growth potential in the next 5-10 years.
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wow, packer, you are my hero
I hope your AIQ will continue to rise (b/c I just bought it a few days ago, believing it's still a 25% yield...)
We will see where I am at year-end as I have volatile stock like SHLD (AIQ) in the portfolio which could materially reduce the return by year-end. Now I am up about 130% so far this year my best year if it holds to the end of the year. I don't expect to be anywhere near this number next year. The TVs along with AIQ helped earlier in the year.
Packer
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Fairfax is hardly a performance loser this year
It's still up 6% YTD, in a year its book value seriously impaired by the bbry disaster and long term bond, etc. etc.
I would say Fairfax and Lancashire.
Gio
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guess overlap with the muni bond I mentioned
, but not necessarily
Surprised to see this not mentioned yet... US Long bond
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Today 's losers can be tomorrow's winners
I can think of the following losers for 2013:
1. Precious metal miners (ABX, etc.)
2. Muni Bond and Muni Bond Fund
3. Some small oil&gas corp in the U.S. and Canada
what else ?
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having value or not, this performance is actually quite amazing for a short only fund;
however, as far as I know chanos is not short only - sometimes he uses a few longs to "hedge" his short, so that if he's really short only his perf should be worse I guess. But I agree it's not a terrible perf and shows that he does have some skills
Am i reading it correctly that he made 2% before fees being short only while the S+P compounded at 12.7%?
If so, those are spectacular results and his reputation and attention are deserved. Whether or not you believe in dedicating capital to a strategy with a low to 0% absolute returns is more of a philosophical debate between asset allocators. But the PDF you posted shows adept short selling skill. Does it not?
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Do we have a previous evidence for this ?
"One thing is for sure. He will tell you he is bearish 3 months after he has re-positioned his fund to exploit lower prices."
In my memory this guy has been pretty consistent - he's just bullish
On the other hand, I never understood his strategy and how he got such an amazing return streak
we don't know how much leverage tepper has used. my guess is he has employed some. buffett never did to my knowledge. In fact he usually always operated with a cash balance. so to be somewhat eggheadish, we need to adjust these returns for risk. I think you have to tax adjust the returns as well. I don't think there has been a more efficient tax minimizer than Berkshire. Finally Tepper could blow up. It's a really low probability. I don't believe Buffett would ever be out of business. Tepper made a big shake hands with the government bet that paid off huge in 2008. That was the right strategy. But there was a small chance the gov would not reach out and "touch" you.
Tepper really is a master trader, and market analyst. Not sure if he's an exceptional business analyst, or if his skills could translate to owner operator like Buffett and Lampert's do. In that sense he might be more comparable to Soros and Druckenmiller. One thing is for sure. He will tell you he is bearish 3 months after he has re-positioned his fund to exploit lower prices.
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What's the discount of large russian big oil like lukoil against majors in OECD countries ?
If the discount is bigger than 70% I will be glad to consider it...
“You can’t make a good deal with a bad person.” - WEB
There might be some value but at what price are you willing to pay?
At half of the value estimation.
"I think if it’s cheap enough, you can afford more country risk or regulatory risk. It’s not complicated." CM
We're all seeing the same thing here. Russia's Government is corrupt. But this doesn't mean their entire stock market is valueless.
It's like investing in China where you have a Government sorely lacking in repute and virtue. There's this miasma of corruption and gross immorality in the markets. And in '04 there was PetroChina... selling at $36 billion. You could have said, the Government is a majority shareholder, this could all go wrong, and so many Chinese companies are frauds. And you'd have been right. There is a possibility of loss-- total loss. But estimate the odds for the possible outcomes. Are the odds in your favor? After you answer that I don't think you need to ask anymore questions.
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So basically the long term dynamics of NG and crude oil is quite different
Basically the high price will persist for crude oil
I have a full position Longlake95. I have added close to the lows.
I still can't believe that acquisitions are not occurring in this sector. It is not like the entire sector is down, it is more smaller, lighter oil oriented firms that are trading cheaply. Even growing firms like LEG are very cheap. If you look at the charts of majors, CNQ, SU and others they are close to 52 week highs. Something is way out whack. But, again most executives seem to buy at the tops or just like average Joe investors.
While I agree that PWT still has too much debt and that most cash flow is reinvested into capex, eventually lower decline rates will mean free cash flow. The assets are good and netbacks are high and will be higher under the new direction.
I found this today under Stockhouse and I think it is well worth thinking about. Sorry for the format:
"Toil for oil means industry sums do not add up By Mark Lewis Rising costs are being met only by ever smaller increases in supply. The most interesting message in this year’s World Energy Outlook from the International Energy Agency is also its most disturbing. Over the past decade, the oil and gas industry’s upstream investments have registered an astronomical increase, but these ever higher levels of capital expenditure have yielded ever smaller increases in the global oil supply. Even these have only been made possible by record high oil prices. This should be a reality check for those now hyping a new age of global oil abundance. According to the 2013 WEO, the total world oil supply in 2012 was 87.1m barrels a day, an increase of 11.9mbd over the 75.2mbd produced in 2000. However, less than one-third of this increase was in the form of conventional crude oil, and more than two-thirds was therefore either what the IEA calls unconventional crude (light-tight oil, oil sands, and deep/ultra-deepwater oil) or natural-gas liquids (NGLs). This distinction matters because unconventional crude has a higher cost than conventional crude, while NGLs have a lower energy density. The IEA’s long-run cost curve has conventional crude in a range of $10-$70 a barrel, whereas for unconventional crude the ranges are higher: $50-$90 a barrel for oil sands, $50-$100 for light-tight oil, and $70-$90 for ultra-deep water. Meanwhile, in terms of energy content, a barrel of crude oil is worth 1.4 barrels of NGLs. Threefold rise The much higher cost of developing unconventional crude resources and the lower energy density of NGLs explain why, as these sources have increased their share of supply, the industry’s upstream capex has increased. But the sheer scale of the increase is staggering: upstream outlays have risen more than threefold in real terms over the past 12 years, reaching nearly $700bn in 2012 compared with only $250bn in 2000 (both figures in constant 2012 dollars). Coinciding with the rise in US tight-oil production, most of this increase in upstream capex has occurred since 2005, as investments have effectively doubled from $350bn in that year to nearly $700bn in 2012 (again in 2012 dollars). All of which means the 2013 WEO has the oil industry’s upstream capex rising by nearly 180 per cent since 2000, but the global oil supply (adjusted for energy content) by only 14 per cent. The most straightforward interpretation of this data is that the economics of oil have become completely dislocated from historic norms since 2000 (and especially since 2005), with the industry investing at exponentially higher rates for increasingly small incremental yields of energy. The industry has been able and willing to finance such a dramatic increase in its capital investment since 2000 owing to the similarly dramatic increase in prices. BP data show that the average price of Brent crude in real terms increased from $38 a barrel in 2000 to $112 in 2012 (in constant 2011 dollars), which represents a 195 per cent increase, slightly greater in fact than the increase in industry capex over the same period. However, looking only at the period since 2005, capital outlays have risen faster than prices (90 per cent and 75 per cent respectively), while in the past two years capex has risen by a further 20 per cent (the IEA estimates 2013 upstream capex at $710bn versus $590bn in 2011), while Brent prices have actually averaged about $5 a barrel less this year than in 2011. Iran not a game changer That prices have fallen slightly since 2011 while capex has risen by a further 20 per cent is a flashing light on the industry’s dashboard indicating that its upstream growth engine may finally be overheating. Without a significant technological breakthrough reversing the geological forces that have driven the unprecedented increase in upstream investment over the past decade, prices will have to rise further in real terms from here or else capex – and with it future oil production – will fall. It should also be emphasized that this vast increase in capex has occurred during a prolonged period of record-low interest rates. Once interest rates start rising again, this will put further pressure on the industry’s ability to make the massive capital outlays required to keep supply growing. Of course, the diplomatic breakthrough achieved with Iran over the weekend could provide some much needed short-term relief to the market, as Iran’s exports could ultimately increase by up to 1.5m barrels a day if and when western sanctions were to be fully lifted. But this would not change the dynamics of the industry’s capex treadmill in any fundamental sense. Even if global oil demand only grows at 1 per cent a cent a year, those extra barrels would be would be fully absorbed by the market within about 18 months. And that is probably how long it would take for Iran’s production and exports to return to pre-sanctions levels in any case. Alternatively, if we take the IEA’s estimate that global production of conventional crude oil from all currently producing fields will decline by 41m barrels a day by 2035 (that is, by an average of 1.9m barrels a day per year), then Iran’s potential increase of 1.5m barrels a day would compensate for just 10 months of natural decline in global conventional-crude output. In short, behind the hubbub of market hype about a new age of oil abundance, the toil for oil is in fact now more arduous and back-breaking than ever. This should worry everybody, because with the evidence suggesting that consumers are reluctant to pay much above $110 a barrel, it is an open question what happens next to the industry’s investment plans and hence, over time, to the supply of oil. Mark Lewis is an independent energy analyst and former head of energy research in commodities at Deutsche Bank; Daniel L Davis, a lieutenant colonel in the US Army, is co-author"
I have also seen a chart that shows U.S. oil production peaking in 2016. Despite the best efforts from the industry, I would tend to believe that they have cherry picked best locations for horizontal drilling and unconventional techniques and that once the Bakken and Eagle Ford mature that it will be difficult to find new fields with such high initial payouts to replace the high decline rates from these large productive plays. We also hear little about Saudi Arabia and their Ghawar field lately, but eventually this will run out or at least become more expensive to milk.
Cardboard
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I guess what you want to discuss is the candidates that may be subject to heavy selling for tax purposes at the year end so that we can take adv of and buy some of them ?
Any recommendation?
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Just wondering from an asset point of view,
is PWE or LTS really much cheaper than US oil&NG corps like SD & CHK
I own PWE and LTS. LTS you get paid to wait and wont be taken under its current price. PWE has a new team, new focus, which works as a great catalyst.
I dont like the small players, they are being taken under on the cheap by foreign companies.
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Hi, T-bone1:
What do you think about the accounting issues raised in http://glennchan.wordpress.com/2013/10/21/chesapeake-chk-is-this-really-a-long/
/Plato1976
TTWO - not a traditional value stock in any sense, but it looks to be cheap, have a moat, and undergoing positive fundamental changes
Also added some CHK after earnings fallout
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It's so easy to find ...
just search "GNCMA corner of berkshire" on google...
no tip needed, btw
GNCMA today (thanks Packer!)
There is no topic on that that I could find. Could you elaborate?
A very quick view showed a small-cap (<$400M) company in the telecom industry (not the most loved industry right now) with a high PE but low forward PE, negative free cash flow, high (>1$B) in debt, low (<2%) margins, low ROE (<10% but growing), insider buys and a recent earnings call. What got you excited? :)
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I have a term life insurance - 20 years
I only need to make sure kids have enough support until they are in college
I don't see a lot of discussions on life insurance on this board - trust a lot of people here are good at investing money
what are people's view about life insurance? do you own life insurance? is it just a term life insurance (i.e., pay a lump sum at death)
or life insurance plus investment - almost using it like a registered tax free account - which at some point can be used as a collateral for loans from the bank (for retirement) -- ???
any thoughts greatly appreciated
thanks
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The new BV, esp. the tangible one, can go below 300USD
it's virtually impossible to get there...
Hoping that it gets down to the new BV. I would love to add at that price.
Canadian oil patch for sale!
in General Discussion
Posted
pwe is a turn around story
how do you estimate its intrinsic value after the turn-around ?