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Started By
Message
re: Stocks...
Posted on 5/5/10 at 7:48 am to LSURussian
Posted on 5/5/10 at 7:48 am to LSURussian
Sold puts yesterday. Love that volatility.
1
Posted on 5/5/10 at 7:51 am to bovine1
Does this fall affect your take on SORL redstick? Still a good long in your opinion?
Posted on 5/5/10 at 12:33 pm to wegotdatwood
No. The market has been getting clobbered. Everything is down. SORL will be fine.
Posted on 5/5/10 at 12:34 pm to kfizzle85
quote:
Redstick, I know you're into the Chinese market, so I thought you might find this link interesting. It is Deloitte's weekly email about Chinese M&A. I've been getting it for about 2 months now, its a pretty thorough weekly rundown. I just got this week's email and it reminded me that I wanted to pass it on. You can also sign up for a host of other newsletters there.
Thanks for thinking of me fizz. I'm going to register there so I can read the email. Appreciate it.
Posted on 5/5/10 at 2:04 pm to RedStickBR
market is SPEWING RED!!!! BLOOD EVERYWHERE!!!!!!!!!! 
I'm looking for a bounce on the SPY around 115ish for some good short term long plays. One stock I'm looking at is GRAN. Technically speaking this fricker looks good. Had a nice little retracement as of late but it's gonna need market strength (like 95% of stocks) to rally. Earnings approaching May 11th, what do you fundamentals guru's see? The technicals speak for themselves on this one.
I'm looking for a bounce on the SPY around 115ish for some good short term long plays. One stock I'm looking at is GRAN. Technically speaking this fricker looks good. Had a nice little retracement as of late but it's gonna need market strength (like 95% of stocks) to rally. Earnings approaching May 11th, what do you fundamentals guru's see? The technicals speak for themselves on this one.Posted on 5/5/10 at 2:14 pm to dutchdanish
quote:You're right. The market hasn't been this low going all the way back to five weeks ago.....
market is SPEWING RED!!!! BLOOD EVERYWHERE!!!!!!!!!!
Posted on 5/5/10 at 2:35 pm to LSURussian
quote:
You're right. The market hasn't been this low going all the way back to five weeks ago.....
It's the end of the world Russian, haven't you heard? I'm gonna go smolder down this gold plated 5 iron my granddad gave me and bury it under the dog house in the back yard.
Posted on 5/5/10 at 2:38 pm to dutchdanish
:omg:
:omg:
:omg:
:omg:
:omg:
Posted on 5/5/10 at 2:58 pm to LSURussian
You see a floor for sorl to hit? I saw when it hit 9 today people got in real quick. Expect to be in the 9 range for a while? Greece and the bank situation in China seemed to murder the market.
Posted on 5/5/10 at 7:05 pm to dutchdanish
Techs are looking good on that one. Your four leading indicators are all calling for a reversal, as is your RSI. Your MACD histogram has not yet leveled off, which would be the icing on the cake. However, any amount of green tomorrow would probably cause just that to happen. In addition, I like the fact that this pullback has been on low volume, that the PPS has held 1.50, that it also appears to be holding the MA(20), and that you have a MA(100)/MA(200) golden cross.
I'll take a look at the fins and get back to you. Any word on earnings expectations?
I'll take a look at the fins and get back to you. Any word on earnings expectations?
Posted on 5/5/10 at 7:07 pm to wegotdatwood
Hold onto it and/or average down. It will be fine over the long haul.
Posted on 5/5/10 at 7:30 pm to dutchdanish
GRAN looks Great!
First thing that struck me was how much cash they have per share. With only 15M shares O/S which, by the way, hasn't been diluted in over 5 quarters, and 72M in cash, that gives of around $4.80 (actually closer to 4.60 when you don't use rounded numbers). The stock is trading at $1.63! That is unbelievable. Additionally, with LTDebt of only 20M and total debt of only 40M, each of which have been paid down in each of the last 4 quarters, not only does the company have plenty of cash on hand to cover their debts, but the company has really improved their balance sheet.
Assets/Liabilities could be better, but the price/book is still only .54. Price/cash, as alluded to earlier, is a strikingly low .35 and Price/FCF is a reasonably 1.01.
Now the Income Statement and Cash Flows are pretty horrid, I admit, but the company does appear to be turning the corner. Sometimes horrible revs lead to great investment opportunities. But for such horrible revs, you most likely wouldn't be presented with a stock that could potentially turn out to be a 2 or 3 bagger in a short time period. I need to read their 10-k and decide on whether or not I think they'll see an increase in net income the next time they report, but this is some good starter DD, in my opinion.
First thing that struck me was how much cash they have per share. With only 15M shares O/S which, by the way, hasn't been diluted in over 5 quarters, and 72M in cash, that gives of around $4.80 (actually closer to 4.60 when you don't use rounded numbers). The stock is trading at $1.63! That is unbelievable. Additionally, with LTDebt of only 20M and total debt of only 40M, each of which have been paid down in each of the last 4 quarters, not only does the company have plenty of cash on hand to cover their debts, but the company has really improved their balance sheet.
Assets/Liabilities could be better, but the price/book is still only .54. Price/cash, as alluded to earlier, is a strikingly low .35 and Price/FCF is a reasonably 1.01.
Now the Income Statement and Cash Flows are pretty horrid, I admit, but the company does appear to be turning the corner. Sometimes horrible revs lead to great investment opportunities. But for such horrible revs, you most likely wouldn't be presented with a stock that could potentially turn out to be a 2 or 3 bagger in a short time period. I need to read their 10-k and decide on whether or not I think they'll see an increase in net income the next time they report, but this is some good starter DD, in my opinion.
Posted on 5/5/10 at 8:35 pm to RedStickBR
GRAN = Granite Banking Corp?
Posted on 5/5/10 at 9:05 pm to RedStickBR
Thought ya'll might find this interesting.
LINK
Highlights:
The Good
Anderson, speaking at the annual shareholders meeting in Hickory, was asked if any mergers or acquisitions were on the horizon. Anderson said he replied that the bank has "been flattered by lots of interest."
The Not So Good
"Bank of Granite has struggled for the past few years, with heavy loan losses resulting in layoffs, low capital levels and a regulatory sanction. The bank usually reports first-quarter results at the annual meeting, but didn't on Monday.
Anderson said the bank planned to report the first-quarter results within the regulatory deadline, by May 15. He said that the annual audit, a safety and soundness exam with regulators, and the "pace of change" in loan valuations had slowed down the process."
LINK
Highlights:
The Good
Anderson, speaking at the annual shareholders meeting in Hickory, was asked if any mergers or acquisitions were on the horizon. Anderson said he replied that the bank has "been flattered by lots of interest."
The Not So Good
"Bank of Granite has struggled for the past few years, with heavy loan losses resulting in layoffs, low capital levels and a regulatory sanction. The bank usually reports first-quarter results at the annual meeting, but didn't on Monday.
Anderson said the bank planned to report the first-quarter results within the regulatory deadline, by May 15. He said that the annual audit, a safety and soundness exam with regulators, and the "pace of change" in loan valuations had slowed down the process."
Posted on 5/5/10 at 9:10 pm to kfizzle85
Yeah, remember the context that we're playing small regional banks. The Income Statements and CFSs are going to be crap regardless. We're looking for companies who are getting ready to round the corner. They can't do much to improve their Income Statments if revenues are down, but they can strengthen their balance sheets. And when interest rates are raised, they'll all be doing much better.
Also, the price to book and cash per share can't be argued with. It would almost be in the shareholders best interest to push for bankruptcy. A fire sale would result in them doubling their investment
Also, the price to book and cash per share can't be argued with. It would almost be in the shareholders best interest to push for bankruptcy. A fire sale would result in them doubling their investment
This post was edited on 5/5/10 at 9:12 pm
Posted on 5/5/10 at 9:14 pm to CajunTiger92
Thanks for the link Cajun. I was aware of the 'not so good' but not 'the good', so that article has proven useful. The company cut losses pretty significantly in 2009 as compared to 2008. Quarter 1 results will give us an idea as to whether they can do the same in 2010. By the time they reach profitability again, if they do, investors will have missed out on a 2 or 3 bagger potentially. The risk is high, although not ridiculously high, nor as high as it was in 2008, but the potential reward is extraordinary.
This post was edited on 5/5/10 at 9:16 pm
Posted on 5/5/10 at 9:18 pm to RedStickBR
quote:I know you're joking (I think), but fwiw, a bank is not allowed to declare bankruptcy. Liquidation of banks is outside the bankruptcy laws. Only the FDIC can be appointed as receiver.
It would almost be in the shareholders best interest to push for bankruptcy.
Posted on 5/5/10 at 9:18 pm to CajunTiger92
quote:They are toast.
a safety and soundness exam with regulators
Posted on 5/5/10 at 9:58 pm to RedStickBR
Brah.
Aside from outright defaults, probably the worst thing for banks is rising interest rates.
I was going to bring this up, but I wanted to make sure we were talking about the same stock. Cash/share is useless for liquidation value for a bank. Its a two-state world: bank gets taken over by regulator and shareholders get 0, or bank does not get taken over and shareholders stay where they are. There is a guaranteed recovery of 0 in the case of a takeover.
As Russian mentioned, they've got a cease and desist from their regulators, and that was in August. According to the 10k, they need to basically double their capital and leverage ratios (by some undetermined time, but presumably not very far off since its been 9 months since they got the C&D). The C&D order puts a lot of stress on their ability to raise capital and make new loans (revenue).
If you scroll all teh way to the bottom, you'll see in the fair value adjustments that they estimate their loans to be worth 40M less than BV. That basically wipes out all of their capital. IMHO, there is zero fundamental basis for holding this stock.
ETA: Oh and their loan loss reserve doesn't even cover half of their existing non performing assets. That's awful.
quote:
And when interest rates are raised, they'll all be doing much better.
Aside from outright defaults, probably the worst thing for banks is rising interest rates.
quote:
Also, the price to book and cash per share can't be argued with. It would almost be in the shareholders best interest to push for bankruptcy. A fire sale would result in them doubling their investment
I was going to bring this up, but I wanted to make sure we were talking about the same stock. Cash/share is useless for liquidation value for a bank. Its a two-state world: bank gets taken over by regulator and shareholders get 0, or bank does not get taken over and shareholders stay where they are. There is a guaranteed recovery of 0 in the case of a takeover.
As Russian mentioned, they've got a cease and desist from their regulators, and that was in August. According to the 10k, they need to basically double their capital and leverage ratios (by some undetermined time, but presumably not very far off since its been 9 months since they got the C&D). The C&D order puts a lot of stress on their ability to raise capital and make new loans (revenue).
If you scroll all teh way to the bottom, you'll see in the fair value adjustments that they estimate their loans to be worth 40M less than BV. That basically wipes out all of their capital. IMHO, there is zero fundamental basis for holding this stock.
ETA: Oh and their loan loss reserve doesn't even cover half of their existing non performing assets. That's awful.
This post was edited on 5/5/10 at 10:00 pm
Posted on 5/5/10 at 10:20 pm to kfizzle85
quote:
Aside from outright defaults, probably the worst thing for banks is rising interest rates.
I know what you're saying, and realize that usually you'd be correct. That being said, this bank is trying to attract customers. Thus, an increase in interest rates will actually HELP them. From their 10-k:
quote:
Changes in interest rates could cause our earnings to decline.
Our balance sheet is currently asset sensitive, which means that when market interest rates change, interest rates on our interest rate sensitive assets, such as loans and investment securities, change more rapidly than interest rates on our interest rate sensitive liabilities, such as deposits
and borrowings. Therefore, there are more assets than liabilities subject to immediate repricing as market interest rates change. In a decreasing interest rate environment, our net interest income will tend to fall, and in a rising rate environment, the reverse holds.
Am I just reading that entirely wrong?
As to the cease and desist, does that usually mean they're automatically "toast", as Russian put it. I see in their most recent 8-k they've elected 7 new directors, which was one of the requirements of the cease and desist order. Is this just smoke and mirrors?
This post was edited on 5/5/10 at 10:30 pm
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