MAY MARKET THREAD

HANS getting CRUSHED.  I had some calls this morning.  i sold 3/4 of them for a gain, i'm left with 1/4 of them that will be worthless tomorrow, making me even on the trade.  I wanted that lotto ticket though.  like most lottos, i lost. 

Buying HANS in the $20's will be nice though. 

Somehow, people still want to buy ugly footwear, as CROX is up huge

Gunners,

I agree..wacky after market action.

CROX giving 50 cent guidance for the year and the stock pops. Even at 50 cents per share, 10 bucks gives them a 20 PE ratio for 10-15% growth. I dont see much reason to own the stock.

HANS on the other hand should earn 1.20 or higher with growth in the 20-25% range.

Seems to me that one is a better buy over the other.  

.Wallstreet: You got the numbers wrong on CROX. They're still projecting over 1.50 this yr which puts their PE under 8.

Crocs, Inc. (CROX) posted earnings of 9 cents per share, vs. 31 cents a year ago, as profit margin narrowed but revenue still rose 40%. Crocs says it still expects earnings of $1.54 to $1.64 per share this year.

Yep I misread this report last night.

I thought they said 45-50 cents for the year, but I re-read it and that was for the next Q.

I would wager some bananas they dont hit 1.50 this next year..

gvk,

I keep scratching my head regarding FRPT and of course I own some.

I should have been buying in the low buck area rather than thinking of selling..its been a great move from there.

I agree with you about the revenue numbers, the problem is that they have to get sales going, especially for the Cheetahs. The stock is wallowing because of that fact..even with the 2x revenues in the books for the next year..

gvk,

FRPT going to be down tomorrow..might add a little bit on that news.

Nothing that we didnt already know, but it will drag for sure.

AIG, is a competitor of mine... that's crazy news today! hahahahaha...sorry for laughing if any of you own the stock, but damn you should see what I have to go up against, when I compete against them

Wall:

I know you are committed to DRYS, and so this is just a general question: what do you think of these recs from others:I have done zero research on them...

You see, Charles H. Dow wrote a series of Wall Street Journal editorials from 1900 until 1902 that outlined the metrics of Dow Theory. During this time (which was over 100 years ago!) the transport sector in the United States was one of the most powerful sector groups in the entire world. But now, as the global economy has become more important than ever, I believe that the “new” Dow Transportation index should be The Baltic Dry Index (BDI).

The Baltic Dry Index, also known as the "Dry Bulk Index," is a shipping and trade index created by the London-based Baltic Exchange. It measures changes in the cost to transport raw materials such as metals, grains and fossil fuels by sea. Any changes in the Baltic Dry Index offer investors like us important insight into the global supply and demand trends, and these changes have proven to be leading indicators of future economic growth.

So here’s the upshot…

Given the strength of the Dow Transports, combined with my view that the Baltic Dry Index is now the superior global transport indicator, I’d like to offer you two powerful small-cap investments that will fully capitalize any continued strength in this powerful sector.

The first company is called OceanFreight (OCNF:NASDAQ). Founded in 2006 and based in Athens, Greece, OceanFreight owns a fleet of 11 vessels that engage in the marine transportation of dry-bulk and crude-oil cargoes.

The second company is called Star Bulk Carriers (SBLK:NASDAQ). Incorporated in 2006 and also headquartered in Athens, Star Bulk Carriers owns a fleet consisting of nine dry-bulk carriers which transport iron ore, coal, grain, steel, cement, and fertilizer.

As you can see from each chart, both of these small-cap shipping stocks have been recovering very nicely, and I fully expect them to pick up steam as the economy recovers. Not only that, but OCNF and SLBK both have attractive forward annual dividend yields -- 13.40% and 11.10%, respectively. This sure beats a 4% CD at a subprime-leveraged bank!

Vermeer,

Yeah I have preference to DRYS because the mix they have, the shift to purchase Ocean Rig and the drill ships, the valuation, margins etc. But there is high risk with it, and I am willing to take that risk.

SBLK has 10 carriers with 3/0/7 mix, the larger size is the Capsize (2) then pana and supramax. They have a 500M market cap, 3M in sales (I am sure that will go up) 300k in cash and no debt, which means when they buy ships (if) they use stock to get cash.

Margins are unknown, yahoo has some messed up numbers.

Fleet info

They are locked up on LONG time charters outside one, so they wont go up stock wise, but the dividend will be steady..not my cup of tea at all.

Ocean Freight has 9 bulkers and 2 tankers..bulkers are all panamax, ALL are very very old..

Fleet Info

They have a 300M market cap, huge price to sales and debt to cash numbers.

Margins on Ocean Freight are 22% profit margin/ 18% operating margin.

DRYS has a 3.76B market cap, lower price to sales and book, also lower leverage cash to debt.

Fleet Info

DRYS has 38 vessels, hardly ANY are on long term charters, the company has been updating the fleet a ton lately..also they have been shifting from heavy panamax to more capsize..

If I were looking at another stock I would look at EXM or DSX over the names listed on this report.

Thanks man, I was wondering, after looking at the numbers, what they saw that I did not. I am sticking where I have been.
 
I placed a small bet on the future of CC by the way. What the hell.Between Icahn and Blockbuster, someone has got to pony up more than $5 a share for that company.Or so I hope.

Vermeer,

I saw that piece on CC too..the issue I have is that CC has a ton of debt and really bad sales/margins.

I hope it works, I think it is worth the gamble.

I think that newsletter brushes the surface in regards to the drybulk group, in this case they looked at a company who has little debt, which is rare and one who has a low valuation. The problem is they didnt look deep enough at things I mentioned, age of fleet, time charters for the vessels etc.

Can anyone tell me why I shouldn't buy CREE around 25 bucks?

Depeche,

They are a mature company, margins arent that great. I know why you are interested in the LED angle..how profitable is that business?

I have never got the impression that the COST to manufacture LED lighting had great margins.

The stock isnt cheap at this price, I would rather see better margins.

I don't think they are that "mature".  Couldn't you have said the same thing about Intel's chips in the early 90's?  The costs will come down and the margins will rise at an increasing rate, I think.  The adoption rate is still so low right now and is going to increase until LED owns the market.  And CREE should be right there as the Intel of LED's.  It's not going to happen overnight, but over the next 2-5 years and forward they should grow rapidly.  Might be a better pricepoint over the next 6-12 months, it might still be a little early, but I think it's one to watch and buy when others are selling.  In 5 years this is a $100 stock IMO.  If it falls under $20 I will buy aggressively.

Depeche,

They have been around 14 yrs, had the bubble spike in 2000 like most tech then have settled in to a trading range since 2001.

My biggest question(s) are margins for LED, and if they can ever turn the corner to have large scale residential use.l havent seen that they can manufacture price wise to make it affordable for residential application yet.

The difference with Intel is the computer industry has a universal acceptance audience, and their pricing power during the 90s and 2000 was amazing..but they too have settled into a mature trading range and probably will stay there unless another revolutionary event happens for them to rapidly increase margins and growth.

It is interesting and if I were investing in LED it would be with CREE.