Look for the right short candidates (like Crown Castle)

October 26, 2010

I was involved in a conversation recently about short selling, where the old adage was trotted out that a stock can rise to infinity but only drop to zero, which is said to illustrate that short selling is more risky than investing on the long side. Although this is technically true, its impact on the […]


Treasury earns 4% a year on TARP investments; I am unimpressed

October 20, 2010

I read in the news today that on the second anniversary of TARP, the government has earned 8.2% on its investments in banks and insurance companies, which comes to about 4% a year. The article claims that many investors expected the deal to have losses running into the billions, which I suppose is true, but […]


Seagate (STX) – What to do about good news?

October 15, 2010

As anyone who holds Seagate (STX) knows, or at least has had the opportunity to investigate upon seeing the price jumping by 16% overnight, there has been news of a buyout offer from TPG Capital and Kohlberg Kravis Roberts to take Seagate private at a price of $7.5 billion, or about $15.88. So, this naturally […]


Saga Communications – Attractive but illiquid

October 12, 2010
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I observed before that the stocks I like come in pairs, and having found Entercomm, a radio broadcaster that went through a difficult 2008 and 2009 and whose operations now seem to have stabilized but at an attractive price. I believe that with Saga Communications (SGA) I have found a paired company. Saga is a […]


A Review of Leveraged Financial Markets, ed. Maxwell & Shenkman, pub. McGraw Hill

October 9, 2010

I have been greatly interested in junk bonds over my investment career, as they offer some potentially very attractive returns and often without correlation to the broader bond or equity markets. However, I have found that because junk bonds are considered as an asset class best left to the professionals, the literature available on them […]


SBA Communications – Too much Debt, not enough Growth

October 3, 2010

I have been interested in short ideas lately, and the last two I identified, Red Hat Inc. and Concur Technologies, were demonstrably overpriced and already showing signs of running out of growth. However, there was no catalyst lurking in the wings that had the potential to throw a wrench into the market’s optimism. However, with […]


American Greetings’ Recent Decline is an Overreaction

October 2, 2010

I have previously expressed an optimistic view on American Greetings (AM), based on its attractive price/free cash flow. Last Wednesday, American Greetings announced earnings that were substantially down from one year ago, and the stock was punished by nearly 10%, although it has recovered somewhat since then. Now, Ben Graham reminds us not to place […]