Author Topic: EAF - GrafTech  (Read 41229 times)

brose514

  • Newbie
  • *
  • Posts: 3
Re: EAF - GrafTech
« Reply #160 on: December 13, 2019, 11:52:25 AM »
It seems like Brookfield is a willing seller at $13. They’re going to exit their position via EAF buybacks or open market sales. I don’t see how there is no short to mid term ceiling on this stock (maybe in the low to mid teens). Not only that, EAF repurchased shares at $18 last year (poor allocation). At a low price Brookfield is a seller (capping price) and at high price EAF still repurchases which may not be the best allocation of capital.


Lakesider

  • Full Member
  • ***
  • Posts: 188
Re: EAF - GrafTech
« Reply #161 on: December 22, 2019, 11:55:25 AM »
Monish goes into some details on EAF in his latest talk at boston college.

https://www.youtube.com/watch?v=kdGltV0eomU&feature=youtu.be

cbourbs

  • Newbie
  • *
  • Posts: 1
Re: EAF - GrafTech
« Reply #162 on: December 22, 2019, 08:25:59 PM »
interesting article:

Not sure if anyone has posted this.

https://events.steelmintgroup.com/needle-coke-prices-wont-fall-in-next-2-years-chinese-needle-coke-manufacturer-tells-steelmint/

possibly another 200,000 tons added to the market in 2020 if 29% of the new production is petroleum needle coke.

valueinvestor

  • Full Member
  • ***
  • Posts: 103
Re: EAF - GrafTech
« Reply #163 on: January 24, 2020, 12:28:34 AM »

bjakes00

  • Newbie
  • *
  • Posts: 47
Re: EAF - GrafTech
« Reply #164 on: January 30, 2020, 02:02:50 PM »
I'll be interested to see if BAM screw minorities in this again how they ever come back to the market with IPOs...they are going to have to hope for a ton of trade sales in the future. Or maybe the market has a short memory.
Additionally, I'm amazed Guy Spier wasn't able to talk Mohnish out of this after Guy got burnt in the TOO saga...BAM are extremely unfriendly majority shareholders - do not invest alongside these guys, ever!

johnny

  • Sr. Member
  • ****
  • Posts: 441
Re: EAF - GrafTech
« Reply #165 on: January 30, 2020, 02:12:32 PM »
Or maybe the market has a short memory.

Check the out the rates on newly issued sovereign debt from countries that have defaulted in the past 20-30 years. Not the same buyers, but a still useful illustration of market amnesia. At some point it seems that -not- occasionally defaulting is sub-optimal.

Xaston

  • Newbie
  • *
  • Posts: 6
Re: EAF - GrafTech
« Reply #166 on: January 31, 2020, 12:48:21 PM »

Check the out the rates on newly issued sovereign debt from countries that have defaulted in the past 20-30 years. Not the same buyers

Not the same borrowers either

ValuePadawan

  • Jr. Member
  • **
  • Posts: 52
Re: EAF - GrafTech
« Reply #167 on: February 06, 2020, 08:01:37 AM »
Looks like another 12 MT on LTA's are being effectively renegotiated with customers in 2020. Not a great look. Also spot prices based on my rough math have come down to $8,900/MT and sounds like they will continue to decline in H1 2020.

Sounds like they will be splitting FCF pretty much evenly between debt and buybacks. I'll be interested to see more in the 10-K around the end of February. I wonder when they are going to sign up customers with LTA's past 2022.

Any thoughts?

RadMan24

  • Sr. Member
  • ****
  • Posts: 365
Re: EAF - GrafTech
« Reply #168 on: February 06, 2020, 06:42:56 PM »
Looks like another 12 MT on LTA's are being effectively renegotiated with customers in 2020. Not a great look. Also spot prices based on my rough math have come down to $8,900/MT and sounds like they will continue to decline in H1 2020.

Sounds like they will be splitting FCF pretty much evenly between debt and buybacks. I'll be interested to see more in the 10-K around the end of February. I wonder when they are going to sign up customers with LTA's past 2022.

Any thoughts?

They still make bank at $8,900 and you have a couple years before new LTAs are signed. The $8,900 is as manufacturing is in a recession, globally. Steel markets down and going through stockpiles at the moment. They suspect 2H recovery, but this also depends on China-US and Europe economic expansions.

The contracts were modified to be extended, some reflected likely bankruptcy of certain customers, none were restructured to reflect current prices. It's purely a demand issue. I think the market and investors are focusing heavily on short term dynamics and extending them out 2-4 years.

Which is fine.

RE: Brookfield concerns. I used to be a Brookfield hater, but, look at TERP. I'm not so sure they can get away with the same thing at a Delaware Corporation public shareholders than at a unit holder limited partnership anyway. If they do, you're not going to lose much money at these prices. Brookfield sold shares at $13...how do you figure they could even offer to buy out the company with those LTAs in place and predicted recovery in 2H?

I still think folks are overthinking this investment, but then again, Guy Spier ain't buying that we know of so the hesitancy is not uncommon.

grym02

  • Newbie
  • *
  • Posts: 12
Re: EAF - GrafTech
« Reply #169 on: February 06, 2020, 07:05:43 PM »
Looks like another 12 MT on LTA's are being effectively renegotiated with customers in 2020. Not a great look. Also spot prices based on my rough math have come down to $8,900/MT and sounds like they will continue to decline in H1 2020.

Sounds like they will be splitting FCF pretty much evenly between debt and buybacks. I'll be interested to see more in the 10-K around the end of February. I wonder when they are going to sign up customers with LTA's past 2022.

Any thoughts?

Can you walk through your math on the $8,900/ton for spot prices? Is that for full year 2019 or Q4? Curious what your estimates were for spot over the year by quarter?