November Stock Talk II Greed is Good

Vermeer,

Primelead is the UDW portion of the company which will earn 5 per share next year, even with 60M shares outstanding, and the following year will add two more drillships, and two more within another 6 months of that.

Unless oil craters to the 30 range, the EPS for the full company could come in around the 12-15 per share range..given comparable rates as the two operating.

There is a ton of debt with the "spun" company since they have 4 rigs on order and the cost of those rigs is 800M each, they arent cheap but when they are earning 600k plus a day, less 120k a day in expenses you can see how valuable they are.

George cannot gain control of Primelead by himself, he does not own enough shares. I read today that he had a margin acct at GS and might have purchased some other stocks and could be needing to pony up some cash/shares of other things he owns due to the drop in the market.

He has other interests in the sector like TOPS (oil tanker stock)  

  Wall,

  Again, I hope you are correct, and I do not know what he has said or done that has not just a couple of people rejoicing at his distress. But he does.And when you have serious enemies in the investment and analyst world, as you know, they can and will wipe you out and have fun doing it.

Vermeer,

George got a bad reputation because in ONE article he was quotes as saying that American investors arent that smart that we rely on computer generated models for buying stock and in general the public isnt so smart..I dont disagree with his view.

The other bashing point is that he is an outlandish person and a public company he was involved with went under, Alpha Shipping. That is true but the foundation of the company was based on low rated junk bonds floated as debt, and the shipping market went bad and the company went out of business. Junk bonds carry a higher probability of default as we know and the shipping market got hammered..similar to now.

I can see how there are similarities between the shipping market then and now, the difference this trip (or that I see) is that the company has the UDW assets which are cash flowing nicely, he also has a majority of the fleet on profitable long term charters which equal over 50% of the fleet for the next 2 plus years. Barring the bankrupcy of the entire shipping industry, those charters which are realistic (not at 100k a day etc) SHOULD hold and that covers all debt payments and reasonable EPS, especially under 50 per share on the common.

This reminds me of the tech blowup and how stocks like CSCO went to sub 10 bucks, ORCL went to 7 bucks, AMZN went to 5 bucks.

Mania and fear in the markets like we are seeing now has caused overblown damage to this company and thousands of others.

Roubini was on somewhere that he said corporate bond defaults would hit somewhere like 15+%. 

The reporter quickly asked him how that would work b/c the highest level of default rate from the great depression was only 8%.

He hemmed and hawed and simply said that is what my model call for.

Look he is smarter than me but I think he is trying to ride the $$ train some for his positions and needs to put forth new opinions on everything that seems more out there than the next.

DRYS is getting hammered bad. 6.86 currently. I have read alot of bad news about the whole industry. 1 thing is that they say china will become a huge dry bulk shipping nation soon. as part of their stimulus package. I dont know how real that is. The shorts on dry bulking industry are making a killing, by killing these stocks. I highly doubt longs are selling under $10 currently under $7. but with no hope in sight they will tear down these companies. i think drys will get to $5.

I had thought that there would be a short squeeze on drys but it aint happening. its already wednesday and the stock is down 15% already. that day when it went to 11 on the reversal was shorts selling scared as the market rallied, they took profits no doubt then calmed down and came back in for more.

I think we will break the closing lows on the dow very soon. i wouldnt be surprised if it was today. theirs no buyers out here. before you'd here people say stocks are cheap now the story is how bad will it get.

I think DRYS will be chipped at for a while until rates get to the point where profitability is not an issue.

There is ZERO doubt in my mind that this is hedge fund shorting..no doubt..the pressure and size and price action, it isnt retail selling.

Burning a ton of cash in this one..a terrible trade for sure.

SKF just rocking along. I think the country is in truly deep shit and only now are people realizing the catastrophic dimensions os the derivative follies Greenspan and company helped initiate.

Look out below!This is going to get even uglier before the end of the year.

 

We're in for the next leg down now. i bet tomorrow paulson and company will be on TV and we sell off more.

Look out below!This is going to get even uglier before the end of the year.
-----------
i think it would help the mkts if we knew who the next friggin treasury secretary was

also if his HIghness didnt resign from the Senate last week we would get a feel for what he thinks about the slew of bailouts

but of course he gives us nothing

He's giving you Clinton retreads bro...

not sure if thats a good or bad thing

next thing you know TheGlobe.com will file to go public and we'll relive 94-2000 all over again

now all we need is the government to not bailout the auto's and we can all form soup lines and start planting crops. i wonder if they had the country vote on an auto bailout what the yes number would be my guess 85%

DRYS is now trading at a little more than 1x 3Q08 earnings

I realize in the market it is all what have you done for me lately and what will you do for me in the future but that is ridiculous. 

I guess at this rate we'll be in the 3's and 4's soon

Hopefully DRYS can at least hang on through this without further diluting so we can reap the benefit of UDW.  That is what I hung on for.  Looking like a horrid decision now.  But I think they can still turn a small profit in 2009 which would help. 

I think UDW is the key in the long run.  I kind of wish I could put this stock away and come back in a year.  oh well. 

Oh yes,  the Republicans are now blaming Obama for everything. This crap has all hit the fan under the Republican Bush Jr. and all the President's men. Ignoorant, biased, Republican A-holes!!! Republican crooks wreck the whole damn country and then try to blame it on the Democrats. FU Republicans!!!

Why don't you tell us how you really feel

Looks like another down day.  When will the madness end?  Could be a long, cold winter. 

i would argue that the genesis of all of the troubles we are facing comes from "lending people money who wouldnt have been lent to"

which political party is more likely relax loan standards to open housing to more people?

all started in 77 with the CRA and then an unchecked fannie and freddie blew it up by allowing banks to lend to everyone b/c they would buy the loans from them. also the big 5 IBs successfully petitioned the SEC to increase leverage to 40:1 in 04

combine that with bad monetary policy and low rates and we have endgame

JP Morgan is "negative" on dry bulk shippers

More analysts who are ahead of the curve 

Yep, saw it below 6 bucks.  Looks like the bailout packages jammed down our throats by that f--head Paulson didn't help, unless of course you want MASSIVE inflation and higher taxes.

What a crock of s--t.

Hope all is good, Vermeer.  Nothing new to report.  Smartest thing maybe I ever did was to go all cash back last January and sell everything I had (401, IRA, stocks, real estate)-----and most in here just laughed in my face.

Do or die time for the S&P

Can it hold?

There are some ugly numbers on the board

C $5.15
GS $50.60
BAC $12.00
MS $9.30
UYG $4.00
DRYS $4.00
Alcoa $7.45
F $1.00