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What are you buying today?


LowIQinvestor

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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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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? :)

 

 

the topic is there. http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/gncma-general-communications/20/

 

 

also related

 

on ALSK

 

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/alsk-alaska-communications/msg140589/#msg140589

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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!)

 

Sorry Plato, I used the forum search function thinking it worked (it doesn't find anything on "GNCMA"). I'll use Google from now on, thanks! (and no need to get grumpy ;))

 

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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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

 

Those issues are real, but they have literally been known about for 10 years. 

 

I think full cost accounting actually makes more sense for shale assets than successful efforts accounting, but like most things, it can be gamed. 

 

CHK has always capitalized just about anything they could, and the FWPP was a misguided attempt to align executives with shareholders in the wildcatting days that turned into a huge leveraged compensation scheme that served no purpose.  The midstream and VPP liabilities are quantifiable and reasonably small (a few hundred million).

 

To step back and look at the bigger picture, this is a company being run from the top by a board hand-picked by Mason Hawkins and Carl Icahn, both of whom have been buyers at these prices.  The new CEO seems very capable and is saying the right things (specifically he is talking about ROIC and cleaning up complications rather than growth and meeting street expectations). 

 

I like the assets, have zero concerns about the accounting or current management team/board, and think there is a lot more improvement to come. 

 

Everyone agrees CHK need to do more work on costs and simplification.  The stock went down after earnings because they are concentrating on that (at the expense of short term production growth).  I think that is an opportunity.

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I will add my .02 regarding McClendon's profit participation.  While large was not that unusual in type...I was in the homebuilding industry in FL decades ago when banks and homebuilders were booming and there were all sorts of profit participation clauses with banks, investors, developers etc each sharing small kickers. This was before stock options really took off as a compensation form.

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There are many times where I can't buy certain companies due to work restrictions. Then I would have to wait until the company is off the restricted list. The restriction can last a day or weeks... It really kills the timing of my purchases sometimes because I can't take advantage of the price volatility.  It is also a reason why I can't comment much on many topics especially with regards to specific companies. Our compliance department is extremely strict (for good reasons).

 

 

With that said couple of reasons: ERICOPOLY's enligtening comments on BAC thread, the JPM settlement, and some cash came in.

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Sounds good.

I'm still greater than 100 per cent notional in taxable account but only about 10 percent in Roth.

The stock could continue to climb but I'm hoping the market starts to discount in the taper in jan or feb.

We saw 6 percent pull back in general market starting in late may of this year on news of a taper.

I think we will see at least 6 percent this time.

The 100k question is if they will actually taper in march.

We'll see.

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Recent purchases in the last month:

 

DSL - Doubleline income solutions fund

NLY - Annaly

BSBR - Banco Santeder Brazil

SAN - Banco Santander

LCSHF - Lancashire

SHLD - Sears holding

 

Not a particular purchase today, but I'm slowly accumulating more DSL, BSBR, with a little SAN overtime through monthly dividend reinvestment.

 

Also, will likely be adding to ATUSF soon.

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fbrc, cheap, just bought back 650,000 shares.

 

 

If you don't mind sharing your thesis on FBRC. From their most recent 10-K their Agency commissions which used to be a significant portion of revenues is declining because of electronic trading ( 117mn in 2008 to 33mn in 2012) The most recent 10Q's also seem to be pointing to this. Offsetting this decline is the capital markets revenue which is strong given current market conditions. 

 

The buybacks seem to support CrestView LP reducing the stake in the company.

 

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I wrote puts on AIG

 

I plan on writing some more puts today. If you don't mind me asking - what maturity are you looking at? And what price range? I've already written some Jan/14 puts.

 

jm25, I wrote puts on the Feb/14, $50s at $2.55.

 

Thanks

Lance

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