Recent Posts

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Investment Ideas / Re: PACB - Pacific Biosciences of California

« Last post by Hielko on Today at 12:59:43 AM »

Does cma say someone else can buy pacb but nor illumina because pacb is running out of money and it would be funny if the government killed the company)

Killing PACB may actually be an Ok outcome for Illumina, which is a scary thought for PACB shareholders. The Brits wouldn’t care too much about killing an US company either.

The whole part of the document about PACB possibly exiting the market if the deal doesn't go through is pretty much completely redacted, but the conclusion of the CMA is that PACB would/could be viable as a standalone entity or that another party would be interested in buying it (perhaps not at the same price as Illumina, or they need to raise dilutive equity financing, but that's not a concern for the CMA). And I guess that's probably true. Their latest gen product doesn't seem to bad and if they can improve it more it could become more interesting.

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Investment Ideas / Re: LBTYA - Liberty Global

« Last post by dontdodebt on November 13, 2019, 10:59:02 PM »

https://www.telecomtv.com/content/5g/why-sunrise-is-going-to-double-down-on-5g-36822/

https://www.cnbc.com/2019/11/12/common-networks-bets-5g-will-replace-cable-internet-in-your-home.html

It seems 5G could make fixed broadband a dead business. Anyone think it's premature or is this happening before our eyes and fixed broadband investments are going to zero..slowly?

I remember having this discussion on the charter thread so you can look there.  It might happen but it will be a slow moving crash and so hopefully if you are careful you can bail.

Isn´t there a risk that 5G will reach almost everywhere simultaneous and offer a cheaper solution than cable "over night"? (This is what I mean with my previous post, I am so uneducated about whole this business)

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Investment Ideas / Re: SPG - Spectrum Brands

« Last post by kab60 on November 13, 2019, 08:52:09 PM »

Where do you see FCF going in 2021? I had estimated that FCF would have been well north of $300 million, so $250 million doesn’t make it seem screaming cheap.

I feel like I’m now betting on them performing operationally as well as Trump ending the trade war more than I am betting the stock is undervalued.

Part of me felt they kind of sandbagged guidance because they should be able to further reduce interest costs by refinancing (and executing well). Looking back at where I got things wrong, their pro forma interest costs are much higher than I anticipated because they didn’t pay off their highest interest debt first. They paid off the term loan with a 4.4% interest rate instead of some debt north of 6%, but this higher cost debt should be refinanced over time.

I'm also negatively surprised by the interest expense, and it doesn't quiet square with the numbers I got from IR (I had runrate interest around 100-125m). The 250m FCF includes a large part of the cash restructuring (100m - hopefully this is the last, otherwise one has to consider it recurring), a 100m hit from tariffs and the use of less factoring. So hopefully those two first go away post 2020. It is a play on operationel improvement now, but their numbers suggest that's very possble, and if they can keep taking share and grow revenues, I don't think it should trade at these levels

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Investment Ideas / Re: WED - Westaim Corporation

« Last post by Cigarbutt on November 13, 2019, 08:13:41 PM »

^This was expected. In fact, despite more significant hardening and higher growth in gross premiums and retention, they are raising equity at the lower bound of their previously planned range, as disclosed last May.
Their legacy business is relatively poor, the benefit of premiums growth will only show up over time and the regulators are focused on capital adequacy.
https://hiig.com/wp-content/uploads/2019/05/HIIG-in-50mn-fundraise-ahead-of-slated-2020-IPO.pdf

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Investment Ideas / Re: NVTR - Nuvectra

« Last post by Spekulatius on November 13, 2019, 07:52:02 PM »

When the rock star CEO departed after aggressively ramping up sales force, it was a tell tale red flag. I'm glad I immediately exited then around $12-13 levels. Medtech is a tough business with an oligopolistic structure at suppliers end (3-4 major players in many categories), a few hundred key hospitals, and maybe a few thousand influential key docs. Breaking into it while also trying to pay a salesforce that is used to earning substantially from commissions is very hard as NVTR found out (you are bleeding cash for years!). They had a few thousand installations but the innovations they took 10 years to develop were either copied easily or less important and they just didn't have clinical testing data (unlike some peers) to really ramp it up fast before they run out of cash.

I never bought this, but been involved in other medtech spinoffs , I can definitely state that this is a tough business for investors. From my experience, many startups manage to get some product in the market and some revenue trajectory, but often the costs outrun the revenues and the increased cash burn does them in.

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Investment Ideas / Re: NVTR - Nuvectra

« Last post by Devils_Shadow on November 13, 2019, 07:14:44 PM »

When the rock star CEO departed after aggressively ramping up sales force, it was a tell tale red flag. I'm glad I immediately exited then around $12-13 levels. Medtech is a tough business with an oligopolistic structure at suppliers end (3-4 major players in many categories), a few hundred key hospitals, and maybe a few thousand influential key docs. Breaking into it while also trying to pay a salesforce that is used to earning substantially from commissions is very hard as NVTR found out (you are bleeding cash for years!). They had a few thousand installations but the innovations they took 10 years to develop were either copied easily or less important and they just didn't have clinical testing data (unlike some peers) to really ramp it up fast before they run out of cash.

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Strategies / Re: Are big banks value traps ?

« Last post by Spekulatius on November 13, 2019, 07:05:59 PM »

Google made a move.

https://www.cbsnews.com/news/google-checking-accounts-will-come-with-citibank-fees/

More clarity from one of the horses mouth:
https://www.sfcu.org/stanford-federal-credit-union-announces-partnership-google/

It looks like a standard CU account with a GUI/ mobile wrapper from Google. It is interesting they they chose to partner with a CU. I wonder how they deal with the affiliation restriction for a CU. You have to be local or work for one of the many Company’s on that affiliate list or use a “backdoor” in order to join a CU.

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Investment Ideas / Re: SPG - Spectrum Brands

« Last post by Broeb22 on November 13, 2019, 06:28:47 PM »

Where do you see FCF going in 2021? I had estimated that FCF would have been well north of $300 million, so $250 million doesn’t make it seem screaming cheap.

I feel like I’m now betting on them performing operationally as well as Trump ending the trade war more than I am betting the stock is undervalued.

Part of me felt they kind of sandbagged guidance because they should be able to further reduce interest costs by refinancing (and executing well). Looking back at where I got things wrong, their pro forma interest costs are much higher than I anticipated because they didn’t pay off their highest interest debt first. They paid off the term loan with a 4.4% interest rate instead of some debt north of 6%, but this higher cost debt should be refinanced over time.

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Investment Ideas / Re: PACB - Pacific Biosciences of California

« Last post by Jurgis on November 13, 2019, 06:17:39 PM »

Does cma say someone else can buy pacb but nor illumina because pacb is running out of money and it would be funny if the government killed the company)

Killing PACB may actually be an Ok outcome for Illumina, which is a scary thought for OACB shareholders. the Brits wouldn’t care too much about killing an US company either.

No company - especially one with bleeding edge tech and patents - is ever "killed". Even if it runs out of money, someone will scoop the assets. I am not a lawyer, but it might be possible even for ILMN to buy the assets out of bankruptcy.

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General Discussion / Re: Are Renaissance Technologies just trend followers?

« Last post by cameronfen on November 13, 2019, 06:00:27 PM »

There are many different ways to make money in the market. But it’s really hard to scale with size. Ren is doing very high frequency trading, resulted in very high sharpe but size can’t be scaled up to more than a certain percentage of a stock ADV

Yes but the idea is you trade every single stock, every commodity, every currency pair and derivative contracts.  After all a neural network that can follow one trend has an easier time of generalizing to other assets.  With that you can manage a lot of assets.