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PWE:  This deserves to sell off due to their accounting issues.  They are not as profitable as they said they were.

 

Suppose you have an asset that yields 10%.  Then suppose news came out that there were "errors" and that the asset only yields 5%.  That would certainly affect the valuation wouldn't it?  I don't get why people on this forum don't understand that.

 

SD, XCO:  They provide very little information on their cash flows and their forecasted/projected cash flows.  So these stocks are like black boxes to some degree.  They are ok shorts because their historic cash flows are bad, management is questionable, negative GAAP retained earnings, etc.  I shorted SD for a very small profit and covered way too early.  SD could go to zero, depending on commodity prices.

 

ADV:  Kami isn't getting built any time soon due to low iron ore prices and probably because the mine would be a very high cost producer.  LMM hasn't nonimated their candidate to the board, so it is likely that LMM is liquidating.

 

ALS.TO:  Same idea... Kami isn't getting built.

 

Drillers:  Haven't done my research.  Requires you to forecast dayrates.

 

FTP:  I don't research stocks that constantly sell stock (except as shorts).

 

SHLD:  The short thesis is obvious.  This is a badly-run retailer that is bleeding cash.

 

Everything else on your list:  I don't understand those stocks.

 

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There are some stocks that have fallen despite the fundamentals not changing.

 

Ryan Gold and Kobex Minerals are fairly easy to analyze because they are mostly piles of cash.  I own a little bit of both.

You could also go to SPAC arbitrage land, which is easy to understand and low risk.

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INLOT: big, stinky, wet cigar butt. Currently under investigation by Dutch authorities for poorly written software that may have allowed tampering with lotteries in Holland (didn't quite understand because the info was in Dutch). I'm not sure if that's really why the stock is tanking. It may just be because everything else is tanking. I sold out of it a few months ago, because it kept disappointing. It's rediculously cheap, but there are a lot of ideas out there.

 

On the flip side, AIQ: rumors sprouted up that they were looking to sell. The next day they issued an 8k stating there was no truth to the rumors, and the stock started its march down. Nothing has changed with the business and there is more than a double there if it sells at at a similar multiple to similar peers. This one looks like a good buy to me

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PWE:  This deserves to sell off due to their accounting issues.  They are not as profitable as they said they were.

 

Suppose you have an asset that yields 10%.  Then suppose news came out that there were "errors" and that the asset only yields 5%.  That would certainly affect the valuation wouldn't it?  I don't get why people on this forum don't understand that.

 

Ryan Gold and Kobex Minerals are fairly easy to analyze because they are mostly piles of cash.  I own a little bit of both.

 

You mentioned before (another thread) that you don't know why board members don't understand your argument regarding PWE. Aren't you being a little presumptuous?  Maybe they understand what you're saying but they've researched the company and found that the accounting scandal doesn't justify the price of the stock.  Seems a more likely explanation than mass ignorance from some pretty successful investors.  Just saying.

 

I'm really curious about your comment on Kobex.  I hold a bit of this, too, for the obvious discount-to-cash reason.  But isn't it actually impossible to analyze as an investment?  In the sense that all we know is that they're going to put that cash into a bunch of mining juniors... so we're trusting that management won't blow the margin of safety inherent in the discount to cash. 

 

Particularly interested to hear your thoughs, given how few kind words you have for the junior mining industry.

Thanks!

 

 

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FTP. We avoided the equity as we thought the odds on worsening prospects outweighed the positives. Today we hold the distressed debs, as we think the odds on a successful restructuring are favorable. Lot of anti-fragile elements, & it gets more anti-fragile every time a cash interest payment is received.

 

Drillers. We hold PD as a core holding, have done for a very long time, & have a very low cost base. Again; anti-fragile, plus dividend cash flow to reduce exposure. We also hold a small and growing exposure to PWE, which we think is overdone.

 

ADV, ALS. Our position is well known.

 

With all of these you have to be comfortable with volatility as your friend, comfortable with not put putting reliance on the traditional valuation metrics, and have some idea of the kickers that come out of IFRS (all are Cdn coys). Buy and hold, and routine hedging, are not mutually exclusive. The names are also strongly asymmetric , both up and down.

 

And with asymmetry - you don't have to be right very often, especially if you can reduce losses to BE, or slightly above ...

 

SD

 

 

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Aiq looks good, nothing changed

 

Alsk is a crappy heavily levered telecom, gncma is better

 

Drillers: if you buy one at 4x Fcf at basically cyclical highs, you need to be pretty sure that continues for another 8 years to be well compensated for the risk (which I'm not)

 

Pwe Xco etc all black boxes? Why on earth buy those vs service firms that are cheaper

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I'm really curious about your comment on Kobex.  I hold a bit of this, too, for the obvious discount-to-cash reason.  But isn't it actually impossible to analyze as an investment?  In the sense that all we know is that they're going to put that cash into a bunch of mining juniors... so we're trusting that management won't blow the margin of safety inherent in the discount to cash. 

 

If they buy shares then the shares would be publicly-traded and be fairly easy to value.

 

Yes, management could destroy value by investing in juniors.  That's a risk you have to take.  But honestly this is one of the easier stocks to analyze.  They have a pile of cash (with a stake in one stock) that may turn into a pile of cash and stocks.  The future value will likely be similar to today's value.  Add in some free money from buybacks and subtract money for the bloated corporate overhead.

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ALS is the only company on the list I had a large position, because it is the only one in your list with what I reckon to be both a good entrepreneur at the helm and a good business (royalties in some very diversified basic necessities of life).

 

But I sold the largest part of my investment in ALS before the sell off. Why? Because I got concerned about what ItsAValueTrap once said: their PG side of the business has never discovered a profitable mine. Therefore, it seems to me that, at least as long as they have debt to pay down, it will be difficult to expand their portfolio of royalties. And I decided to wait and see.

 

I also wanted to shift a lot of capital into Liberty Media because of the planned (and now announced) spin-off. That might have been not such a good idea, given the fact Liberty Media is down more than the general market during the last few days.

 

Gio

 

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INLOT is interesting in that despite the poor performance recently has grown BV by 6% annually since 2008 and 8% annually over the past 10 years (excluding minority interests).

 

Packer

 

Well you have the greek stock market plummeting and the possible problem in The Netherlands so maybe it shouldn't be surprising. The stock also traded down to half this level (!) a few years ago which makes me a little nervous to buy more. Irrational but I know how tempting it is to buy more when you start averaging down because of the endowment effect.

 

On the other hand it's one of those stocks that everybody loves to hate, even here. Maybe that is a positive (but equally useless) sign. ;)

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Many names mentioned here are down big from recent high.

 

 

FTP, FNM, FRE, AIQ, PWE, SD, XCO, SHLD, INLOT, ALSK, ALS, ADV, Drillers, Russian stocks.

 

 

Anyone here are not in any of these names, please share why u avoid them all?

 

 

I look for easy no-brainers that I can understand.  None of those fit the bill.  The only one I do understand is SHLD and what I understand about it is that it is a failed retailer on an excruciatingly painful and slow slide downhill towards eventual bankruptcy.  Not exactly something I want to put money into.

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Many names mentioned here are down big from recent high.

 

 

FTP, FNM, FRE, AIQ, PWE, SD, XCO, SHLD, INLOT, ALSK, ALS, ADV, Drillers, Russian stocks.

 

 

Anyone here are not in any of these names, please share why u avoid them all?

 

 

I look for easy no-brainers that I can understand.  None of those fit the bill.  The only one I do understand is SHLD and what I understand about it is that it is a failed retailer on an excruciatingly painful and slow slide downhill towards eventual bankruptcy.  Not exactly something I want to put money into.

 

+1

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Many names mentioned here are down big from recent high.

 

 

FTP, FNM, FRE, AIQ, PWE, SD, XCO, SHLD, INLOT, ALSK, ALS, ADV, Drillers, Russian stocks.

 

 

Anyone here are not in any of these names, please share why u avoid them all?

 

 

I look for easy no-brainers that I can understand.  None of those fit the bill.  The only one I do understand is SHLD and what I understand about it is that it is a failed retailer on an excruciatingly painful and slow slide downhill towards eventual bankruptcy.  Not exactly something I want to put money into.

 

I agree there are some stocks which help me sleep at night knowing management is doing a great job (C, BAC, and AAPL)

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