The market's biggest worries today seem to be copper and oil and China. I don't know how much this affects health care now that the public option is off the table (end of the Obama steamroller), or tech, which has shown no signs of weakening. Obviously the Oil Services HOLDR (OIH) will be under severe pressure.
Position: none
Asian equities declined sharply after U.S. markets weakened Friday and amid concerns about the pace of recovery in the global economy, with the MSCI Asia-Pacific Index down 3.2% after setting a 10-month high Friday. The Nikkei lost 3.1% as Japanese GDP came in below expectations but also as concerns mounted about a bursting of the equity market bubble in China. The largest losses in Asia came from China, where last week's equity market slide accelerated today. The Shanghai Composite dropped 5.8% after falling 6.5% last week.
European shares are under pressure, with oil and gas (crude oil has extended Friday's losses) and consumer goods suffering the largest losses, followed by financials amid renewed concerns. Meanwhile, the S&P 500 futures have set a new low for the month, and early indications suggest U.S. markets will open on a weak footing.
Position: None
|
|
Doug Kass
|
| Hostile Market Environment |
8/17/2009 7:28 AM EDT
|
Last week, Jim "El Capitan" Cramer dove into the investing pool with the confidence of Michael Phelps.
I demurred and cautioned about swimming naked in the pool just because the temperatures have zoomed higher in late summer.
The weather, like Mr. Market's upward momentum, can be most unpredictable.
From my perch, there are numerous economic outcomes possible, many of which are not market-friendly.
The outcomes are hard to predict right now, as William Butler Yeats wrote,
The best lack all conviction, while the worst
Are full of passionate intensity.
What I am relatively certain about is that the numerous uncertainties argue against heavy commitment to equity and credit, especially in light of the magnitude of the advance.
Position: None
I dont know, Doug; the fact that the futures haven't attempted to lift makes me feel it is a tad artificial. Chinese playing hard to get in oil, iron ore, fertilizer and copper. Smart guys!!
Position: none
|
|
Tom Graff
|
| Treasury Reaction a Bit Muted |
8/17/2009 7:57 AM EDT
|
The 10-year Treasury has rallied in response to the ugly stock futures, but it feels a bit muted. 10's right now up 3/4 point, but given that the Dow looks to open down 200 points, 10's should be up at least a point. We are hitting significant resistance here at 3.48%. The old 10-year (i.e., not the most recently auctioned, August 2019 maturity, but the previously auctions May 2019s) closed at a 3.48% or 3.47% four times since June 29, only breaking through once (between July 7 and July 13). Not coincidently, that was the last major selloff we saw in stocks.
Position: None
|
|
Doug Kass
|
| Lowe's Follows the Weather Pattern |
8/17/2009 8:01 AM EDT
|
Don't be faked out by the disappointing Lowe's (LOW) report this morning as it is backward-looking and reflects the poor New England weather through July.
There is plenty of pent-up demand (like it or not!) as the poor weather has taken a toll on the condition of the housing stock.
Position: Long LOW
I expect to hear:
- worst selloff since March
- repeal of the rally
- China is finished
- huge declines coming.
I am in agreement with No. 1 only. Lowe's (LOW) has now executed poorly -- you can tell because they are still putting up new stores. What is with those guys? Home Depot (HD) is doing much better...
Position: HD
|
|
Tom Graff
|
| MBS Underperforming |
8/17/2009 8:56 AM EDT
|
GSE MBS are struggling to keep up with Treasury bonds as high dollar prices are making investors nervous. The 4.5% coupon has pushed above par again (now $100.25). That coupon has recently been trading at a ratio of about 65% of the 10-year, meaning that if the 10-year Treasury rises 1%, the Fannie 4.5% MBS should rise 0.65%. Today its less than 50%.Should Treasuries rally into the 3.30%, that ratio could fall into the $20s. Very little upside.
Position: None
The PowerShares QQQ Trust (QQQQ) is trading down from $39.63 to $39.11. I would expect an early pop to around $39.40, where I will be looking for a short and a possible dip under $39. We have been recovering later, so I will do my best to buy the bottom and see if we recover again.
Position: none
|
|
Marc Chandler
|
| Empire Survey Points to Manufacturing Growth in New York State |
8/17/2009 9:15 AM EDT
|
The first of the Fed regional manufacturing surveys for August, the Empire survey, was much better than expected, rising to 12.08 vs. 3.0 expected, and the highest reading since November 2007. The data show positive growth in the New York manufacturing industry. (A reading above 7.2 is consistent with positive growth in factory output according to Fed research.)
The six-month outlook was also encouraging, jumping to 48.3 from 33.99, with new orders and shipments jumping along with capital expenditures and technology spending, suggesting companies are confident enough in the economic outlook to invest in equipment and technology. The employee component also improved.
The stronger-than-expected report may not be repeated later this week when the Philly Fed survey is due. The Empire survey has tended to outperform the Philly Fed index (expected -2 vs. -7.5), although it has been fairly consistent with the national surveys. The Empire survey provides some evidence that the non-auto sector is also showing signs of growth and has helped provide some modest support for the S&P futures and the foreign currencies, but the gains have been limited, suggesting the data are unlikely to act as the catalyst for a sharper move higher in the currencies. Attention remains focused on the equity markets.
Position: None
|
|
Tim Melvin
|
| Will It Stay Down? |
8/17/2009 9:27 AM EDT
|
It is going to be very interesting to see if the market bulls can push the market up off this weak open. All the momentum in recent weeks has been to the upside. Virtually every selloff has been met with late-day buying that seems to almost inevitably take prices back into the black.
I have said repeatedly that I did not think the market was correctly pricing the state of the economy. When the momentum shifts, it could happen quickly and sharply. I will be watching closely today to see if the fading perception of China leading the world out of recession finally brings out enough sellers to change the tide.
Position: nm
|
|
Marc Chandler
|
| Fed Extends TALF for Commercial Real Estate |
8/17/2009 9:29 AM EDT
|
The Federal Reserve announced that it would extend the TALF--the Term Asset Backed Securities Facility. It was set to expire at the end of the year and there has been much anticipation of the Fed extending the program. Typically, the Fed seems to make such announcements 1-2 days after the FOMC meeting--partly keep the credit facilities separate from the conduct of monetary policy per se and partly because the decision is made by the Federal Reserve board rather than the FOMC, though no doubt the regional presidents weighed in on the decision.
For newly issued commercial mortgage backed securities, the program has been extended to June 30, 2010, while for other asset-backed securities and CMBS issued before Jan 1, 2009 the program has been extended to March 1, 2010. The announcement is not that much of a surprise in substance, even if the timing as a bit of a surprise. Because the announcement did not come at the end of last week, some observers anticipated it to be made next month.
As some of the emergency liquidity provisions of dwindled for the lack of use, in part growing out of success, it is clear though officials remains concerned about the commercial real estate market and is not yet convinced, apparently, that the securitization machine is up and running again.
Position: None
I am covering a portion of my REIT index short this morning, but I don't think the correction is over yet.
Position: none mentioned
|
|
Marc Chandler
|
| TIC Data Firm as Long-Term US Assets are Purchased |
8/17/2009 9:45 AM EDT
|
The Treasury's June TIC data were better than expected and point to a shift away from short-term safe-haven investments in favor of longer-term assets. The June data showed that foreign investors bought a much larger than expected net amount of long term U.S. assets or $90.7 billion vs. $17.5 billion expected.
That is the largest net inflow to longer-term securities since April 2008 and is well above the 12-month and 24-month averages of $19.1 billion and $35.5 billion respectively.
At the same time, overall net foreign purchases of U.S. assets, including short-term Treasury bills and other short-term assets, actually fell $31.2 billion (vs. $23.0 billion).
Details show that foreign investors bought an even larger amount of longer-term U.S. securities, a net $123.6 billion, of which private investors purchased $105.2 billion. That was somewhat offset by U.S. investors' net purchases of foreign long-term securities ($32.9 billion).
Overall net foreign private-sector outflows accounted for the bulk of the shift, selling a total net outflow of $27.7 billion, while central banks sold a net $3.5 billion as short-term investments were sold off. Foreign investors purchased a net of $78 billion of Treasuries, $10.9 billion of agencies and $16.9 billion of equities.
The recent auctions suggest that foreign central bankers have continued to purchase U.S. Treasuries with last week's three-, seven- and 30-year auctions showing strong demand from indirect bidders which includes central banks. Still, the data have had little impact on bonds or equities. The foreign currencies are only slightly firmer after their overnight slide.
Position: None
|
|
Tom Graff
|
| Corporate Bonds Weaker |
8/17/2009 9:48 AM EDT
|
Not surprisingly, corporate bonds are significantly weaker today vs. Treasury bonds. This is one of those days when buyers and sellers are feeling each other out. In an over-the-counter market (which corporate bonds are) there isn't any way to just see "how is it trading." Most names don't trade more than one or two times a day, sometimes not at all. So today the stock market opens up very weak, and accounts are not aggressively buying or selling. What do the dealer desks do? They just quote everything 10 basis points wider and see what happens. As I said, the early color is that we don't have many actual sellers. One trader I talked to still thinks there is substantial demand at wider levels. We'll see if that demand shows up.For now, the iShares Investment-Grade Bond Fund (LQD) is underperforming Treasuries by 1%, consistent with about 12 basis points of widening.
Position: None
|
|
Doug Kass
|
| Taking In Some Short Rentals |
8/17/2009 9:57 AM EDT
|
I am taking in half of my trading short rentals now.
Position:
None
Is this the mother of all new bull markets? Or the mother of all sucker rallies? I ran into Nouriel Roubini Friday evening at a Southampton restaurant, and despite being a bit humbled by market action lately, he believes it's the latter. As one can tell from my postings, I am much more concerned about risk in equities than I have been at time since this winter. This rally seems remarkably similar to the one we had the same time last year. The serial bottom-callers declare victory as the market rallies in the face of bad news. We all know how that turned out. I continue to remain defensively positioned. China goes. The global growth trade goes. Domestic retail, consumer, and financials go. The only place to hide is in the defensive sectors and bonds. Sucker's rally or new bull market? The next few months will determine that outcome.
Position: none
|
|
Jim Cramer
|
| Doug -- Great Trading |
8/17/2009 9:59 AM EDT
|
Doug, congratz and it shows how non-dogmatic you are. And it is just such good trading to lock in some of those gains. Well done. Beautiful, and thanks for filling us in. Stocks I watch are stabilizing -- AAPL, except for oils...
Position: none
|
|
Jim Cramer
|
| Roubini/Marcin/Hamptons! |
8/17/2009 10:18 AM EDT
|
Sorry, Bob, I am more mesmerized by the fact that Roubini hangs out in the Hamptons than I am by what he is saying! I had him pegged for a workaholic who had disdain for the Hamptons! Meanwhile, I think any rally this early is a blown rally and stocks need to stay down. ... How about Humana (HUM)/UnitedHealth Group (UNH)/Aetna (AET)/Cigna (CI) -- the illogical winners of the whole thing. Man, are they powerful. More powerful than the alleged Superman Rahm!
Position: none, including Hamptons...
|
|
Jim Cramer
|
| Citigroup/Health Care |
8/17/2009 10:21 AM EDT
|
Watching Citigroup (C) really rally hard here. Boy, do the institutions want that one. Meanwhile, the winners, Express Scripts (ESRX), Medco Health (MHS), Cardinal Health (CAH), all emerging from a huge cloud, along with HMOs. Still reeling from Roubini revelation...
Position: ESRX
Sterling was the market's darling over the last five months and was the best-performing G-7 currency. Between March 10 and Aug. 5, sterling appreciated by more than a fifth against the U.S. dollar and by 10% against the euro. However, since the Bank of England unexpectedly extended its quantitative easing, sterling has been slammed. It is the worst-performing major currency since Aug. 5, losing a little more than 4% against the dollar and almost half as much against the euro.
Most of the time, the market demands a higher interest rate from the U.K. than the eurozone. But this is not the case at the moment. Looking at the December 2009 short sterling vs. the December 2009 Euribor futures contracts, which serve as a proxy for short-term rate differentials and are the key to forward prices, U.K. rates have slipped below eurozone rates.
This happened briefly in late May and roughly coincided with a euro bounce against the pound. It also took place at end of last year, and then too the euro outperformed sterling.
This interest rate development, coupled with a news stream that included renewed weakness in the Rightmove house price index and the unwinding of risk trades, warns that sterling is particularly vulnerable against the euro. A base in the cross has formed in recent sessions near in the GBP0.8560-70 area. A move now above GBP0.8650 would likely compel at test on GBP0.8700, but there is potential GBP0.8800 and then GBP0.8950.
The anticipated weakness of sterling against the euro does not necessarily mean that it will also decline against the dollar, but at this particular time, it looks like that will be the case. Technical indicators for the pound are poor and support against the dollar is not to be found until closer to $1.60.
Position: None
Yes Jim, Dr. Doom, or Dr. Realism, takes a break like all of us. He's a charming and funny fellow in person. The Hamptons? Our own rock star, Dougie, hangs out there as well. He must own the place with his current hot streak! Kudos, Doug. As for real estate, there or in the city for that mattter, I would still be a seller rather than a buyer. I am in print for 1,000 bank failures and 1996 real estate prices. Gotham and its beach towns included.
Position: none
Out of my Goldman Sachs (GS) short stock completely now.
Position: nm
|
|
Tom Graff
|
| Corporate Bond Update |
8/17/2009 11:05 AM EDT
|
JPMorgan Chase (JPM) and Goldman Sachs (GS) are the best benchmarks for overall corporate bonds. Both have gone from high beta to low beta in the last six months. If they were to become high beta again, it would really be meaningful.To that end, GS opened 10 wider, now 20 wider. JPM opened about 8 wider, now 15. On a 10-year bond, each 1% in price is worth about 12 basis points in spread, so GS is underperforming Treasuries by about 1.5%. One day doesn't tell you a lot, but at least for today, the two stalwart financials are underperforming. It isn't a great sign for the broader market.The only new deal today is Baxter International (BAX) bringing $500 million of 10-year bonds around +110. The deal is supposedly going very well.
Position: Long GS bonds
I wish to inject some strong notes of caution into two suggestions made by Don Dion in his earlier post on sugar.
First, do not trade an ETF that is only 25% sugar as a proxy for sugar. The r-squared between the DBA ETF and spot sugar since January 2007 is only 9.2%.
Second, the sugar ETN, SGG, embeds the contract roll on sugar and therefore underperforms the spot index. Here the r-squared is 26.6%.
As I will discuss tomorrow, the real impact will be in the relative performance of food and soft-drink stocks.
Position: None
|
|
Doug Kass
|
| Positive Data out of American Express |
8/17/2009 11:40 AM EDT
|
American Express (AXP) reports good July delinquency and write-off rate data just now.
Position: None
I read with great interest Jim Cramer's comments on natural gas. If he is right and gas continues to move lower, taking the stocks with them, it is going to be a real opportunity. If the gas producers get down to tangible book and low EV/EBITDA ratios, it is going to be a "back up the truck" trade. I will be watching these very closely going forward.
There is a simple truth to consider here. We are years, or probably decades, away from meaningful solar and wind power generation. The source of greener power is going to be natural gas, nuclear and even cleaner coal. All the speeches and proposals in the world cannot turn the light switch on. When the posturing is over, gas will be back in demand. The current cutbacks in exploration will create a shortage in the years ahead, and we will be playing catch-up, sending these stocks soaring for years to come.
I would like to see the president come out against natural gas. I would love to buy those price levels created by that speech.
Position: nm
|
|
Doug Kass
|
| Citigroup Follows in American Express's Footsteps |
8/17/2009 12:01 PM EDT
|
Citigroup (C) follows American Express (AXP) with good charge-off data just now.
Position: None
The Brazilian reai, which is easily the best-performing major currency this year (gaining almost 25% in this year through Friday against the U.S. dollar), is being hit with a wave of profit-taking today. Its 1.5% decline, though, is a bit less than this year's other top performers, include the antipodeans, scandi-bloc and sterling. The profit-taking on the currency appears to be reflecting the profit-taking that is weighing local shares, which itself seems to largely be a reflection of the drop in commodities. Even Petrobras (PBR), which appeared to exceed earning expectations, is off almost 4% today. Today looks to be the largest drop in the Bovespa since early this year.
The reai is at its lowest level here in August and the dollar is trading above its 20-day moving average for the first time since mid-July. The near-term risk extends toward BRL1.90. A move above BRL1.91 could spur a further dollar advance toward BRL1.95.
Position: None
|
|
Doug Kass
|
| Covered the Balance of Trading Shorts |
8/17/2009 12:05 PM EDT
|
I have covered the other half of my trading shorts after the positive Citigroup (C) and American Express (AXP) trust data releases.
Flat now.
Position: None
The Mexican peso is under pressure today as risk trades are unwound. Despite the peso's 1.15% loss against the dollar today, it remains the best-performing major currency against the dollar thus far this month. Several large investment houses have recommended long-peso positions to benefit from the healthier appetite for risk or as a way to play the recovery in the U.S. auto sector. We have been more skeptical of the peso and Mexican macro fundamentals. These fundamentals doubts will find support in this week's data, and especially the second-quarter GDP figures that are due out later in the week. After an 8.2% annualized contraction in Q1, the consensus expects that the Mexican economy contracted by 10.7% in Q2, while most countries have reported a slowing pace of contraction (U.S. and U.K.) if not outright expansion (Germany, France and Japan). The central bank meets at the end of the week and is widely expected to leave rates steady at 4.5%. A surprise rate cut would likely be seen as peso-negative.
Mexico's Cemex (CX), the largest cement maker in the Americas, announced a new debt agreement that will extend maturities on about $15 billion of debt for five years. The details appeared to be in line with market expectations. Shareholders will vote on the plan on Sept. 4, according to news wire accounts. The stock is marginally lower today, but holding up better than the Bolsa.
Mexico's weekend decision to replace border guards as the government steps up its anti-corruption campaign is a favorable development, however. The dollar held its 20-day moving average against the peso (~MXN13.10) earlier today, and unless this level is convincingly taken out, look for a consolidative phase to emerge.
Position: None
|
|
Jim Cramer
|
| End of Heaviest Part of the Correction? / Cramer on Kass |
8/17/2009 12:16 PM EDT
|
Doug Kass, congratulations. Big money made and then -- sensibly, I believe -- a good cover on the banks. I can't tell you how many times Citigroup (C) has told me it is all about the credit cards. These numbers are pretty startling. I remain a huge supporter of Citigroup here. Nice going, Doug! Now let's see what Ron Insana does? Take advantage of the lift to go? Inquiring minds want to know!
Position: none
|
|
Jim Cramer
|
| Weighing Against End -- Timing |
8/17/2009 12:28 PM EDT
|
I hate "rallies" that start early on, too much ease with which to take things down later in the day. I also hate selloffs on expiration week because it could mean that stocks have to touch lower strikes before they get to where they will go out. That said, I feel as if I would be nuts to go against Doug here ... too good a call.
Position: none
Jim/Tim, I do not see the long-term economics of natural gas being affected by the current political preferences expressed in Washington.
First, natural gas' short-term volatility is much higher than its long-term volatility; this is a function of its extremely price-inelastic supply and demand curves. Once the present imbalance is corrected, the price weakness will end. Equities tend to be priced more off the long-term than the short-term price for natural gas strips and swaps as a result.
Second, natural gas policy is one of change, no pun intended. It has been regulated, partially deregulated, fully deregulated, banned from utility use, encouraged as a substitute for other fuels and is subject to a wide variety of supply interruptibility clauses. The industry knows current policy is just that, current, and will change with the next administration and cycle.
The long-term reality is the world is chock-full of methane. Firms who invest to find and distribute it are then faced with huge downward marginal prices, as seen today. It always has been and always will be a highly cyclical business, regardless of the political climate.
Position: None
Here are a few stories and videos from our flagship site that you may have missed:
Position: n/a
If the last year has taught us anything, it's that the market will dramatically overshoot to the downside as well as upside. I don't know if this is the start of a real correction or not. But I do know that once it begins, investors will underestimate its damage. I expect the bottom fishers to relearn the lesson of last fall's "negativity bubble" buying.
Position: none
|
|
Geoff Johnson
|
| Back To School Blues To Be Expected; Holiday Holding My Breath |
8/17/2009 2:24 PM EDT
|
I read a Saturday NYT article about how back to school sales will be the worst since forever and I am sure they will be. The data showed that last year bts sales were positive, but that this year's would be solidly negative. I would note that this should be expected as last August bts sales were pre-economic and stock market crash. Of course, they will be worse this year.
My bigger concern is the guidance from major retailers last week for negative comps for the holidays. Of course, if I was in their shoes I'd be planning for exactly that and then hope for better. So, the bad news is the comp guidance is negative, the good news... ok, the almost good news... is that they are already providing guidance that accounts for this. If they meet this guidance and if things will get even the slightest bit brighter into 2010, then these stocks only need to correct, not crash anew. At least that is my take.
I still believe that at the end of this year, as we cycle the crash we begin to see a smattering of retailers begin to comp positive. Job numbers and confidence have to fall in line. However, I must admit that the likelihood of a down comp holiday is in front of us and that the positive comps may not come until we cycle the worst of the GDP numbers and layoffs in 1H'10.
Position: none
|
|
Geoff Johnson
|
| Lowe's Customer Spent Up, but Pent Up, Too |
8/17/2009 2:34 PM EDT
|
Lowe's call was hardly an upper pill. But they note that the customer is deferring projects that can't be put off forever. Should jobs stabilize and consumers begin to feel a little more secure about their world these projects may happen. I suspect many will happen all at once. (If these projects happen all in a rush at some point, I then may have to worry about the sustainability of this "growth", but I'll deal with that then.)
I do not dismiss any of the negative arguments made on this site or elsewhere. Yet, for me, I keep coming to the conclusion that I want to be completely open to the likelihood of upside events happening, too. I accept my optimism could be early, but do not believe it is entirely misplaced. I can always sell stocks and get bearish again if I need to... and will.
Position: none
|
|
Howard Simons
|
| Selloffs During Quantitative Easing |
8/17/2009 2:42 PM EDT
|
Bob, I thought I'd take a look at selloffs in Japan during their zero-rate and quantitative easing era. They went to 0% in February 1999. The Nikkei rallied from 14,367 in February to 20,337 in March 2000 before breaking to a new low in December 2000. The 0% sugar buzz was good for under two years.
They eased quantitatively in March 2001; the March level was violated by June 2001. They eased again last December, sputtered into March and then took off with the rest of the world.
I ask this because if you are right about any future selloff going further and faster than expected, Japan is the only data point in the modern era we have for what happens to a market selling off with free money. It looks as if a future failure can overwhelm the policy response.
Position: None
|
|
Tom Graff
|
| 10-year butting up against 3.48% |
8/17/2009 2:48 PM EDT
|
They are really defending 3.48% on 10's. Its been a very narrow range today, especially given how strong the move is overall. Normally you'd expect some kind of pullback. Close below 3.48% would be very bullish and I think we'd move quickly toward 3.30%.
Position: None
|
|
Tim Melvin
|
| Sinking Like a Stone |
8/17/2009 3:11 PM EDT
|
One of the successful IPOs form earlier this year is seeing its share price get crushed today. Rosetta Stone (RST) the maker of language learning software cut its outlook for the third quarter and investors have knocked 245 off the share price so far today. The company had just raised guidance a few weeks ago but now says that operating expenses will be much higher than expected. This one is well on the way to being a busted IPO. New issue investors are not the most loyal bunch in the first place and this type of rapid guidance change will sent them rushing for the exits. Management wisely canceled an expected secondary stock offering
I can hear the class action boys salivating all the way over here. This another example of why I avoid hot stocks.
Position: nm
|
|
Tom Graff
|
| Despite all the negativity |
8/17/2009 3:25 PM EDT
|
The two corporate deals priced today: Baxter and Mead WestVaco both performed well. Mead is only Ba1/BBB rated and today didn't feel like a good deal to bring a junk-rated deal. Yet both eventually priced at lower spreads than the original talk.That's another tell as to the difference between a healthy pull back in credit spreads and something more ominous. A run-of-the-mill pull back will still see new issues perform reasonably well. A buyers strike will see new issues struggle to get done. There wasn't enough supply today to draw much conclusion, but its something to watch. Stay tuned.
Position: None
Tim, was Rosetta Stone ever a viable business, or was it a hot stock attached to the business of wishful thinking?
As someone whose language skills border on the non-existent, I might be part of their target market, someone who might believe they could learn a language over their computer when all else had failed. Their late-night TV commercial tells me NASA uses it, and once I get done wondering what languages NASA might need on the International Space Station, I am impressed.
But the business always struck me as having high fixed and marketing costs and a finite market.
Position: None
Howard I think it is a viable business. The people I have talked to that have used the product give it very high ratings. Apparently the method actually works for teaching new languages. The revenue forecast for the quarter of 64.5 to 66.5 million so the product is selling. it is not a logically price stock however and given management thankfully does not seem to understand stock price management and the guidance game I think it will go lower.
The stock has an EV/Enterprise ratio well over 22. The price to book is over 4 and the price to sales ration is 2.5. Those are big numbers for a one product company. I suspect that this company eventually becomes a division of a larger publisher or education company but that will happen a price way below here.
Position: nm
If anyone circled any BBT here please tell us the allocation?
Position: none
|
|
Mebane Faber
|
| Mining Hedge Fund Filings |
8/17/2009 8:36 PM EDT
|
Tim has a nice recent article titled "Mining the Filings". He takes a look at what 3 legendary investors are buying now (Greenlight, Third Point, and Baupost).If an investor simply bought the top 10 stock holdings, rebalanced the portfolio each quarter when the filings became public, it would beat the market by over 10% a year since 2000 in every case. (Source: AlphaClone)
Position: None, long following these 3.
|
RSS FEEDS
PODCASTS
