Lance Posted June 15, 2015 Posted June 15, 2015 Shorted TNA (Direxion Daily Small Cap Bull 3X Shares) and bough KMI Thanks, Lance
no_free_lunch Posted June 19, 2015 Posted June 19, 2015 DBA $26 Jan / 15 calls. This is a tiny investment but I think the odds of a spike in grains is higher than the cost implies. It will still probably be worth $0 but if it hits it could be 10,20,30, maybe even 40x. Too many stories about drought out there and yet grains are fairly low.
valueyoda Posted June 19, 2015 Posted June 19, 2015 CSTM, MU, CHK and BRK/B (Berkshire is now as oversold as it was at the 2009 and 2011 lows, despite only a minor correction).
TwoCitiesCapital Posted June 22, 2015 Posted June 22, 2015 Sold about 40% of my OUTR position today. This is a continuation of my slow deleveraging to pay of margin debt and to raise a cash balance that I have been doing over the past few months. I'll continue selling at intervals as soon as the gains hit their long-term status and the price stays around here or higher. Now that the shares are up 40%, I have to be more accurate in my assumptions of how quickly its business will decline for further value appreciation and I'm concerned about an overall market decline. I'd rather take the ~30% net profit over the last 12 months generated by margin and not be greedy and regret it.
Liberty Posted June 23, 2015 Posted June 23, 2015 CSTM, MU, CHK and BRK/B (Berkshire is now as oversold as it was at the 2009 and 2011 lows, despite only a minor correction). Can you explain your thinking behind your view that BRK is as oversold now as in 2009/2011? Thanks.
TwoCitiesCapital Posted June 23, 2015 Posted June 23, 2015 Just purchased a speculative position in BBRY again as software revenue does seem to be accelerating. Somewhat "blind" faith in John Chen but the numbers do seem to merit some confidence in the guy.
valueyoda Posted June 25, 2015 Posted June 25, 2015 CSTM, MU, CHK and BRK/B (Berkshire is now as oversold as it was at the 2009 and 2011 lows, despite only a minor correction). Can you explain your thinking behind your view that BRK is as oversold now as in 2009/2011? Thanks. BRK is now as oversold as it was in 2009 and 2011 on the multi-day money flow index, a good long term contrarian indicator how much capital flows in and out of a stock. Often times, this happens in a later stage of the bull market when a stock after a strong up movement becomes highly oversold after a 6 month consolidation or correction period, only to use this as a springboard for a rapid move upwards. BRK/B is definitely not as undervalued as it was in 2009 or 2011, but is still reasonably priced, with an intrinsic value around $167 per share. It should be noted that the p/b ratio becomes increasingly less relevant, since the percentage of BRK/B's free cash flow derived from non-insurance operations grows rapidly and will continue to do so in the future, so that using a 1.2x p/b multiple yardstick will cause many lost opportunities to buy the stock cheaply, as that particular ratio will only be reached during severe market distress.
Liberty Posted June 25, 2015 Posted June 25, 2015 CSTM, MU, CHK and BRK/B (Berkshire is now as oversold as it was at the 2009 and 2011 lows, despite only a minor correction). Can you explain your thinking behind your view that BRK is as oversold now as in 2009/2011? Thanks. BRK is now as oversold as it was in 2009 and 2011 on the multi-day money flow index, a good long term contrarian indicator how much capital flows in and out of a stock. Often times, this happens in a later stage of the bull market when a stock after a strong up movement becomes highly oversold after a 6 month consolidation or correction period, only to use this as a springboard for a rapid move upwards. BRK/B is definitely not as undervalued as it was in 2009 or 2011, but is still reasonably priced, with an intrinsic value around $167 per share. It should be noted that the p/b ratio becomes increasingly less relevant, since the percentage of BRK/B's free cash flow derived from non-insurance operations grows rapidly and will continue to do so in the future, so that using a 1.2x p/b multiple yardstick will cause many lost opportunities to buy the stock cheaply, as that particular ratio will only be reached during severe market distress. Thanks. The word "oversold" can mean many things, so I wanted to know which one you meant. Cheers.
Guest longinvestor Posted June 25, 2015 Posted June 25, 2015 CSTM, MU, CHK and BRK/B (Berkshire is now as oversold as it was at the 2009 and 2011 lows, despite only a minor correction). Can you explain your thinking behind your view that BRK is as oversold now as in 2009/2011? Thanks. BRK is now as oversold as it was in 2009 and 2011 on the multi-day money flow index, a good long term contrarian indicator how much capital flows in and out of a stock. Often times, this happens in a later stage of the bull market when a stock after a strong up movement becomes highly oversold after a 6 month consolidation or correction period, only to use this as a springboard for a rapid move upwards. BRK/B is definitely not as undervalued as it was in 2009 or 2011, but is still reasonably priced, with an intrinsic value around $167 per share. It should be noted that the p/b ratio becomes increasingly less relevant, since the percentage of BRK/B's free cash flow derived from non-insurance operations grows rapidly and will continue to do so in the future, so that using a 1.2x p/b multiple yardstick will cause many lost opportunities to buy the stock cheaply, as that particular ratio will only be reached during severe market distress. The 1.2x becomes a red herring with each year passing. Earnings, especially retained earnings, ballooning while BV is marked to original cost makes the 1.2 look silly. All they are saying is that they won't buy back shares if it isn't a 50 cent dollar. Just like anything else they'd buy.
Zorrofan Posted June 25, 2015 Posted June 25, 2015 Shorted TNA (Direxion Daily Small Cap Bull 3X Shares) and bough KMI Thanks, Lance Lance, Regarding KMI, I am considering lightening up as I am anticipating another "taper tantrum" when the FED finally raises rates this fall. Also worried about the high payout ratio, they are paying out the vast majority of their cashflow.....your thoughts? cheers Zorro
Lance Posted June 26, 2015 Posted June 26, 2015 Hi Zorro - I think it probably moves lower when the Fed raises and am watching the payout ratio. I sold my position in full in April and will likely ease back into it as/if it moves lower. My recent purchase was about 20 percent of what I previously held. Thanks Lance
Fowci Posted June 26, 2015 Posted June 26, 2015 CSTM, MU, CHK and BRK/B (Berkshire is now as oversold as it was at the 2009 and 2011 lows, despite only a minor correction). Can you explain your thinking behind your view that BRK is as oversold now as in 2009/2011? Thanks. BRK is now as oversold as it was in 2009 and 2011 on the multi-day money flow index, a good long term contrarian indicator how much capital flows in and out of a stock. Often times, this happens in a later stage of the bull market when a stock after a strong up movement becomes highly oversold after a 6 month consolidation or correction period, only to use this as a springboard for a rapid move upwards. BRK/B is definitely not as undervalued as it was in 2009 or 2011, but is still reasonably priced, with an intrinsic value around $167 per share. It should be noted that the p/b ratio becomes increasingly less relevant, since the percentage of BRK/B's free cash flow derived from non-insurance operations grows rapidly and will continue to do so in the future, so that using a 1.2x p/b multiple yardstick will cause many lost opportunities to buy the stock cheaply, as that particular ratio will only be reached during severe market distress. The 1.2x becomes a red herring with each year passing. Earnings, especially retained earnings, ballooning while BV is marked to original cost makes the 1.2 look silly. All they are saying is that they won't buy back shares if it isn't a 50 cent dollar. Just like anything else they'd buy. Retained earnings are included in book value - not quite sure what your point is?
Shawn Posted June 28, 2015 Posted June 28, 2015 Large caps like Walmart and ExxonMobil are getting cheaper, prompting a closer look and possibly an investment. Is it me or are P/E ratios starting to lower ?
Guest longinvestor Posted June 28, 2015 Posted June 28, 2015 CSTM, MU, CHK and BRK/B (Berkshire is now as oversold as it was at the 2009 and 2011 lows, despite only a minor correction). Can you explain your thinking behind your view that BRK is as oversold now as in 2009/2011? Thanks. BRK is now as oversold as it was in 2009 and 2011 on the multi-day money flow index, a good long term contrarian indicator how much capital flows in and out of a stock. Often times, this happens in a later stage of the bull market when a stock after a strong up movement becomes highly oversold after a 6 month consolidation or correction period, only to use this as a springboard for a rapid move upwards. BRK/B is definitely not as undervalued as it was in 2009 or 2011, but is still reasonably priced, with an intrinsic value around $167 per share. It should be noted that the p/b ratio becomes increasingly less relevant, since the percentage of BRK/B's free cash flow derived from non-insurance operations grows rapidly and will continue to do so in the future, so that using a 1.2x p/b multiple yardstick will cause many lost opportunities to buy the stock cheaply, as that particular ratio will only be reached during severe market distress. The 1.2x becomes a red herring with each year passing. Earnings, especially retained earnings, ballooning while BV is marked to original cost makes the 1.2 look silly. All they are saying is that they won't buy back shares if it isn't a 50 cent dollar. Just like anything else they'd buy. Retained earnings are included in book value - not quite sure what your point is? http://www.rationalwalk.com/?p=13422 The above piece captures my thought. Yes, retained earnings are included in BV but as the article above point out, the dominant proportion of the BV understatement come from how accounting requires them to treat their wholly owned business investments. (BNSF, Marmon mentioned but also age-old holdings like Geico). In other words, FV of these businesses is diverging away forever from BV. Retained earnings is the smaller part of BV and getting smaller vis a vis unaccounted FV. Additionally, retaining earnings wisely (making one dollar more than one) is the story of this corporation, no? Turning a dying textile business into this behemoth by wisely reinvesting earnings, no? At the time of writing of the above article, 44% of retained earnings during BRK's 50 year history were retained since 2009. Make that >60% as of today. Why I believe they are comfortable with buying back shares at 1.2xBV. Estimates of IV suggests that the 1.2xBV is a 50 cent dollar. Look for the 1.2xBV floor to be revised upwards to 1.5x....2.0x over time. It will still be a 50 cent dollar at the time because of BV understatement. Could take 10 more years but in all likelihood it will. It will be irony that as their size precludes them from easily finding 50 cent dollars elsewhere, their own stock may!
Lance Posted June 29, 2015 Posted June 29, 2015 AXP, PRU and NCZ (Allianz Convertible & Income Fund) Thanks, Lance
vinod1 Posted June 29, 2015 Posted June 29, 2015 Estimates of IV suggests that the 1.2xBV is a 50 cent dollar. Hi longinvestor, Does this mean that your estimate of IV for BRK is 2.4x BV? Just curious, I have never been able to justify much above 2x BV even in my most optimistic scenario. Thanks Vinod
Guest longinvestor Posted June 29, 2015 Posted June 29, 2015 Estimates of IV suggests that the 1.2xBV is a 50 cent dollar. Hi longinvestor, Does this mean that your estimate of IV for BRK is 2.4x BV? Just curious, I have never been able to justify much above 2x BV even in my most optimistic scenario. Thanks Vinod I'm not the numbers type, yet indulged because of boredom that comes with owning BRK. Playing around with assumptions (discount rate, owner earnings etc.), my IV range is between $240,000 and $340,000. The big range supports my vaguely correct posture and I'm comfortable with it. While I may be over optimistic, the market continues to under estimate BRK as the norm. Been buying more.
vinod1 Posted June 29, 2015 Posted June 29, 2015 Estimates of IV suggests that the 1.2xBV is a 50 cent dollar. Hi longinvestor, Does this mean that your estimate of IV for BRK is 2.4x BV? Just curious, I have never been able to justify much above 2x BV even in my most optimistic scenario. Thanks Vinod Thanks! I'm not the numbers type, yet indulged because of boredom that comes with owning BRK. Playing around with assumptions (discount rate, owner earnings etc.), my IV range is between $240,000 and $340,000. The big range supports my vaguely correct posture and I'm comfortable with it. While I may be over optimistic, the market continues to under estimate BRK as the norm. Been buying more.
Guest longinvestor Posted June 29, 2015 Posted June 29, 2015 Estimates of IV suggests that the 1.2xBV is a 50 cent dollar. Hi longinvestor, Does this mean that your estimate of IV for BRK is 2.4x BV? Just curious, I have never been able to justify much above 2x BV even in my most optimistic scenario. Thanks Vinod Thanks! I'm not the numbers type, yet indulged because of boredom that comes with owning BRK. Playing around with assumptions (discount rate, owner earnings etc.), my IV range is between $240,000 and $340,000. The big range supports my vaguely correct posture and I'm comfortable with it. While I may be over optimistic, the market continues to under estimate BRK as the norm. Been buying more. While on the subject, I've seen many calculators / calculations using two columns, using DCF etc. But not much discussed about the "third (more subjective) element" which deals with the efficacy with which retained earnings will be deployed. WEB covers this on page 123-124 of the AR. Your thoughts on this? After all, retained earnings is the story of Berkshire since 2009. Curious as to your take on this. Thanks
ourkid8 Posted June 29, 2015 Posted June 29, 2015 Are you purchasing RB shares to swap them for Premier? It's cheaper then buying premier directly! :) Russell Brewery! Cheers.
drzola Posted June 29, 2015 Posted June 29, 2015 Are you purchasing RB shares to swap them for Premier? It's cheaper then buying premier directly! :) Russell Brewery! Cheers. Yes. Alot more volume as well.
Guest notorious546 Posted June 29, 2015 Posted June 29, 2015 do we have an "What are you selling today?" thread.
Recommended Posts
Create an account or sign in to comment
You need to be a member in order to leave a comment
Create an account
Sign up for a new account in our community. It's easy!
Register a new accountSign in
Already have an account? Sign in here.
Sign In Now