Phaceliacapital Posted January 4, 2013 Posted January 4, 2013 Hi everyone, edited to prevent recognition I have been interested in investing since university and have collected (and read, for those wondering) a nice (imo) stack of books over the years. Included are traditionals such as Graham, Buffett bios, Fisher, Lowenstein, Greenblatt etc but also less known (or less available) works such as Klarman, Pike, Staley etc, and several AR reports from our well known gurus. I am excited to join this board and hope you can profit from my knowledge as I will of yours! Feel free to ask questions! PS: I started investing from a TA point of view, but don't hold that against me..
LC Posted January 4, 2013 Posted January 4, 2013 Hey there, welcome to the board! While I have your attention, I'd love to draw on your experience in the container industry: What's your take on the container market? How deep/liquid is it? From an operations perspective, how efficient is it? Are buyers entrenched in certain purchasing habits or do they change frequently? How easily can sellers unload excess inventory? Do you think there is there room for consolidation in terms of marketplace structure? Do you envision electronic platforms as being successful in this market?
rkbabang Posted January 4, 2013 Posted January 4, 2013 Welcome. Whats TA ? :D The Church of Technical Analysis. Telling the future by the readings of the Sacred Charts. :) Just poking a little fun. Welcome to the board Phaceliacapital.
Green King Posted January 4, 2013 Posted January 4, 2013 Welcome. Whats TA ? :D The Church of Technical Analysis. Telling the future by the readings of the Sacred Charts. :) Just poking a little fun. Welcome to the board Phaceliacapital. uMMM.... wE don't like your types around these parts. :) Welcome Again I think Dr Michael Burry started with some TA elements but turned to the light.
biaggio Posted January 4, 2013 Posted January 4, 2013 I think WEB tried TA as well. The smart guys are the ones that realize that it does not work. Good to have another smart guy around.
infinitee00 Posted January 5, 2013 Posted January 5, 2013 Hey there, welcome to the board! While I have your attention, I'd love to draw on your experience in the container industry: What's your take on the container market? How deep/liquid is it? From an operations perspective, how efficient is it? Are buyers entrenched in certain purchasing habits or do they change frequently? How easily can sellers unload excess inventory? Do you think there is there room for consolidation in terms of marketplace structure? Do you envision electronic platforms as being successful in this market? Hi Phaceliacapital, welcome to the board ! When I first got introduced to the stock market ( in my early teens), TA sounded great until I realized my folly. I would never go back to that stuff ( gosh, I sound like a reformed cocaine addict or something ! :)). Btw, I would love to get your answers to the questions posted by LC and anything else you can share about the container shipping industry. Do you see a shift towards higher TEU ( 18,000+ like Maersk) vessels in the next few years? The growth of container industry seems to have slowed. Do you see a reversion to the historical 8-10% growth or further decline in growth in the next few years? How has the oversupply of container vessels in 08-09 changed business practices and strategy going forward? What do you think are the major shifts in the industry?
Parsad Posted January 5, 2013 Posted January 5, 2013 Welcome Phaceliacapital! Yes, you are correct that there is a good group of core boardmembers. We have plenty of good lurkers as well. Enjoy the board! Cheers!
berkshiremystery Posted January 5, 2013 Posted January 5, 2013 Welcome Phaceliacapital! you might be interest to study one of board's silent lurkers ;D (i.e.,... Mohnish Pabrai moves inside the shipping industry). Among Pabrai’s classic value investments that is spoken of in admiration in the market is when he dipped into the Norwegian oil tanker firm Frontline in 2002 soon after shipping rates fell to $5,000 a day. To remain profitable, the company needed rates of at least $18,000 a day on its 70 double-hulled oil tankers. Investors fled the stock, and it fell to $3.Frontline wasn’t considered a classic value play since it didn’t have much by way of net current assets. But it had hard assets in the form of tankers. Pabrai studied the oil shipping business and discovered that small Greek shippers with near-obsolete single-hulled tankers were being hurt more than Frontline and were selling their ships for scrap. So he knew that when oil demand next surged, Frontline would be able to command premium rates. Months later, Frontline was charging $50,000 a day per tanker and Pabrai made a killing.
SharperDingaan Posted January 5, 2013 Posted January 5, 2013 There's a handy little 'container' company (T.PSN) in the NA oil patch that may be of interest. Welcome to the board.
DynamicPerception Posted January 5, 2013 Posted January 5, 2013 "I think WEB tried TA as well." He did. His problem with the charts was that when he turned them upside down they still looked the same.
Phaceliacapital Posted January 9, 2013 Author Posted January 9, 2013 Hey there, welcome to the board! While I have your attention, I'd love to draw on your experience in the container industry: What's your take on the container market? How deep/liquid is it? From an operations perspective, how efficient is it? Are buyers entrenched in certain purchasing habits or do they change frequently? How easily can sellers unload excess inventory? Do you think there is there room for consolidation in terms of marketplace structure? Do you envision electronic platforms as being successful in this market? I checked with my boss (he is part shareholder of a container company) to get his 2 cents: He considers the container market to still be pretty liquid, although dryboxing containers (speciality of the company) has seen a recent dip due to china (has become less and less exporting, but that's nothing new) but expects this to pick up again in the coming years. So positive outlook on average. The company he has a stake in is incredibly efficient, just to give you an idea (as a tank container lessor): Gross Margin: 45% Ebit Margin 20% And a crazy FCF (despite investing in additional containers) Buyers have very stable purchasing habits, I forgot to ask what he thinks of excess inventory... There is definitely room for consolidation and he expects this to become reality in the next couple of years, I have worked on 3 buyout scenarios for the same company this year. You btw also see diversification, the larger shipping container taking over smaller air/rail containers (with a special interest toward nonstandard containers such as cooling containers (for food, blood, plasma), that market is undoubtedly going to boom) Electronic platforms, to the extent of the lessor company where I worked, definitely yes, they are finishing the implementation of a program ( i forgot the name but might be able to find it) that makes tank container placement/ordering/billing significantly more efficient, management gave us a presentation and I was really impressed. And yes, the industry is evolving towards the use of the mammoth ships, container size will remain the same however. The shift in business vessels I honestly do not know, I'll try to pick his brain later today Please let me know if you need additional info
LC Posted January 9, 2013 Posted January 9, 2013 Thanks for your perspective: the reason I ask is a relative of mine who has been an industry exec. for many years is helping roll out an electronic platform. His views are similar to yours. Namely that buyers/sellers are very "stuck in their ways", however electronic platforms offer much in terms of ease-of-use and efficiently managing various shipments. I'd be interested to know the name of the program you mention...I would not be surprised if it is the same one :) Thanks again and welcome to the board!
Phaceliacapital Posted January 9, 2013 Author Posted January 9, 2013 I will try to find out, I also asked concerning the excess supply and he told me this created a lot of opportunity for the lessor company to expand its fleet at a reasonable price (which is no surprise ofc). Also, I was currently researching Enhanced Equipment Trust Certificates, and found this very informative presentation (also gives a very nice history and fun facts) over at Kroll Bond Rating: http://online.wsj.com/article/SB10001424127887324391104578230060513922882.html?mod=djemalertNEWS Also, you got any experience with EETCs?
infinitee00 Posted January 9, 2013 Posted January 9, 2013 Thanks for the info. I am studying the container shipping industry and now know whom to ask if I have any question :) and welcome to the board once again.
LC Posted January 10, 2013 Posted January 10, 2013 I will try to find out, I also asked concerning the excess supply and he told me this created a lot of opportunity for the lessor company to expand its fleet at a reasonable price (which is no surprise ofc). Also, I was currently researching Enhanced Equipment Trust Certificates, and found this very informative presentation (also gives a very nice history and fun facts) over at Kroll Bond Rating: http://online.wsj.com/article/SB10001424127887324391104578230060513922882.html?mod=djemalertNEWS Also, you got any experience with EETCs? My understanding is that many times a shipper will have excess capacity come available last minute (as a buyer pulls out) and has a lot of trouble selling it. Maximizing utilization is a big problem in the industry. Regarding EETCs I was not familiar until you brought it up, from the wiki article it seems relatively straightforward but I have no firsthand experience with them. This looks like a good resource which details their use regarding aircraft lease financing, however I would assume the same holds true for freight ships: https://www.tcw.com/News_and_Commentary/Market_Commentary/Insights/~/media/Downloads/Commentary/Fixed%20Income%20Research/Fixed%20Income%20Commentary/Other/030810_DFIrsch76_UpInTheAir.ashx
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