It's a hot potato. Was at 82 now at 68. Could be at 82 again for all we know. Trading looks horribly bearish on the surface but the big addressable market still makes it an interesting trade. I don't have a ton of conviction in it but the market is approaching a bounce point fairly soon so will hold to see what transpires
Ha. It's all good. Nice trade. I view LEJU as an ideal buy the dip candidate. The fundamentals of their business are extremely bullish longer term. Now whether or not we drop to $11 first who the hell knows.
I will say this about YELP...The reason it's down is because net adds on the biz accounts was below expectations. However, I remember clearly back in like 2006 or 2007 when I was buying up BIDU there was a quarter or two where people freaked out over the next adds of paying accounts and the stock sold off. This of course was quickly erased by the fact that the addressable market being so astronomical that it ended up being just a blip in hindsight. So maybe YELP just hired the wrong sales guys? Who knows. Fact of the matter is you're still talking about a market that is really big and they don't even have 1% of it. Sometimes it takes hand holding and educating the customer while the market realizes the benefits.
Let me guess...perma bears like Doug Kass and Rick Santelli are saying "I told you so", ignoring the fact they have been advising people to sell for the past 40%?
My 14 year old niece, who is the prototypical teen and who I use in part to follow trends, asked for a GoPro for her birthday. 2 birthdays ago she asked for Uggs (when DECK was at $40). I asked her what was so special about it vs the others and she said its water proof and is just cool ie everyone else has one or wants one. I have my doubts longer term but they definitely tapped into teenagers desire to share their lives with their friends and get attention for themselves.
My daughter just got home from spending 7 weeks in Europe and said the GoPro's were very popular. All the Australians they met had them, plus a bunch of other people. Seem to be really hot, not sure if the stock price already reflects this though.
Yeah that's my gut feeling, that its priced in, but I was surprised to hear my niece's take on it. Wouldn't be surprised to see it run to like $100 even if the long term viability doesn't play out.
Pull up a chart of the S&P 500 in 1996 after it went on a huge run in 1995. I think the SOX is mirroring it. This dip seems like it should be bought in the bigger picture. Remember this is a 13 year breakout.
Tempting to do a bit of buying today. Doubt that this is the bottom, but a few stocks are looking pretty good and, you never know, it might be the bottom and I'd hate to miss it.
I wouldn't go whole hog but I think it makes sense to buy in pieces on stuff you want to hold. All of the buys I'm doing today will most likely be short term trades because I suspect we think there's a decent chance of a bigger move down in a week or so. Who knows though. Better to just buy stuff you're ok with owning at lower prices if you have confidence in them.
Added to my position in CGI Group (GIB). They had a good quarter and their outlook was good, so I feel like I am getting a bit of gift here being that it is pulled down by the broad market.
And added to small cap energy company TBE in Toronto. Management put a whack of their own money into recently at $1.80 and their management is good, so a good indicator, plus has a good yield.
Still have lots of cash as I do think we see a bigger pullback this fall, but the risk/reward has shifted a bit more to the good, so want to increase my exposure.
Looks like the markets are going to be down for July. Was actually a very flat month until today. But will put some red on the monthly charts which is good.
TOF, bought 80% of GIB.A in Toronto at $36.14 and added 20% today at $39.04.
But average it out with the exchange rates and its around $33.60 US. Bought it all in the last 2 months. I had bought it earlier this year and sold it for about a 6% profit. But, I've done some more work on it and I think it is a good one and decided to go back in. I plan to hold it for a while, but who knows.
Event Adjusted EPS we would call in line; CFO was strong relative to expectations. We term the quarter mixed due to in-line revenue and a 92% book/bill. We maintain a BUY rating and $46 target price. IMPACT: MIXED European revenue growth should resume next year. Europe revenue is seen bottoming out in FY15 as strong trailing bookings (116% book/bill) offset the pruning of unprofitable contracts. U.S. federal bookings are expected to pick up in the next couple of quarters. The industry-wide slowdown in CGI Federal bookings is expected to ease; the company expects half of its $1.5 billion bid backlog to be decided by calendar Q4. The table is set for better overall top-line momentum in FY15. Outside of U.S. Federal, the trailing book/bill is 113% in the U.S. and 107% globally. The combination of CGI Federal bookings improvement and better European top-line momentum should return CGI to overall top-line growth next year. Our near-term revenue assumptions are trimmed modestly. We now model EPS of $2.81 for FY14 (from $2.85) and $3.11 for FY15 (from $3.19). There should be no lingering concerns over cash flow. Two consecutive quarters of about $350mm cash from operations (despite ongoing integration payments) puts CGI on track to hit or exceed $1.2b annualized CFO in our view. This maps to almost $1b in FCF or about a 7-8% FCF yield. M&A: CGI is "in good shape, financially, to move". The debt/capitalization ratio is down to 32.6% long-term debt facilities could provide the stability to go after additional acquisitions. Stated target areas are in the U.S. market (presumably more on the commercial side) or additional IP-based solutions. TD Investment Conclusion There is no change to our BUY rating and $46 target. Our target assumes CGI trades to 8.6x fwd EBITDA in 1 yr – a slight premium to the 3-yr median of 8.1x given what we think is a more diversified platform. Accenture trades at 10.1x forward EBITDA and the peer median is 7.4x. We think a sharper rebound in top-line growth momentum or additional M&A could drive upside to this valuation.
Man I'm going to have to jot this one down...so many calls to go through. PCRX just sticks out to me as a blockbuster report. I really think that thing is going to be a multi bagger from here, even after the big move it has had for the past few years. We're talking about a game changer drug (Exparel) that is getting adopted rapidly by the doctor masses. Look at these total account numbers just the paste handful of quarters:
total accounts 2,815 2,452 2,106 1,732 1,435 1,065
Also from TD, their Quart guys see stocks rotating from value to growth:
We believe that equity markets are making what we would describe as a rotation back to growth stocks from cyclical/value stocks. This is most evident in the U.S. with the recent relative strength in the large-cap S&P 500 Technology and Health Care sectors. At a sector level, this relative strength is largely coming at the expense of the Consumer Discretionary sector, which is traditionally an early-cycle sector and, most recently, the Industrials sector. At this stage, the rotation to growth is not a bearish trend, as the very defensive U.S. Consumer Staples and Utilities sectors remain relatively weak. If these sectors began to outperform, we would be more aggressive in reducing our cyclical exposure. Equity markets appear to be most similar to the 1997 to early 1998 period when large-cap U.S. growth dominated relative performance (Exhibit 6). This was also a period when commodities were weak in a slow global growth environment and the U.S. dollar was relatively strong. With Energy prices at risk (see below), we believe that a lower Canadian dollar is probable. As we discussed in recent weeks, macro indicators such as the decline in global interest rates, flattening yield curves, year-over-year declines in commodity prices, and the plunge in the Baltic Dry Index are not conducive to a cyclical rotation, in our view. In addition, weak seasonal trends for most commodities, particularly oil, in the late summer/fall is causing us to reduce our cyclical exposure. At the same time, we expect the scarcity premium in Canadian defensive growth names to continue rising. We also believe that Canadian financials stand to benefit, particularly if energy, as we expect, continues to trade lower through the fall (see below).
Interesting take. Yeah the cyclicals aren't doing all that well, huh? at least in the shipping space. AA is doing well though and I would consider that a cyclical.
I've been looking a little closer at the 97/98 period and it seems like we would at least pause here in the selloff. I don't see anything like the 98 contagion issue at hand, especially since China is re-accelerating, and Europe is not doing down the tubes, as much as people would like us to believe. Perhaps we do get a QE induced sharp selloff but that wouldn't come until a few months from now I would presume. I am willing to put some money on the idea that this is all part of a range bound trade for the next few months before breaking out to higher highs.
Yeah I've been watching that one closely. Not sure where the entry point would be but its probably not the best bounce candidate when the market stops selling off.
Yes. I think the Russell could have a rough time over the next year. The valuation is horrible and you have major headwinds working against it if rates move up. Not sure about the latter. I still think we see a rally in the small caps to 1180ish first.
I see no low risk entries in the stock market. There are two trades I like outside the stock market:
(a) Bonds. TLT (the long bond) appears to have found support following a shallow retracement (not far from where I exited the opposite trade in RYJUX on Wednesday). Long RYGBX at the close. (b) USD. The dollar had its best monthly performance in two years in July, and is due for a retracement. Long RYWBX (Rydex Weakening Dollar 2x Strategy) at the close.
A low risk entry in my opinion would be if we get a minor bounce then a follow through downside move that brings the Russell down near May lows. I suspect we get the minor bounce early next week. I'm finding a lot of interesting stuff though.
I tried to short LOCO today at $41+ but got the following message: "Shares of this security are currently not available to short sell."
I know this chain well. It's ok food, nothing to write home about. Their balance sheet is a mess. They trade at 5 times sales (same multiple as CMG, 3X PNRA) and at 75X annualized EPS in Q1 (keep in mind they haven't turned a profit in the past 3 years)
2nd- I have to leave and once it broke S2 I was out. GL ladies!
ReplyDeleteIt's a hot potato. Was at 82 now at 68. Could be at 82 again for all we know. Trading looks horribly bearish on the surface but the big addressable market still makes it an interesting trade. I don't have a ton of conviction in it but the market is approaching a bounce point fairly soon so will hold to see what transpires
DeleteI sense shorts starting to pay closer attention here.
ReplyDeleteAlright. YELP off the tablet @ 67.97. I can't waste any more time on it.
ReplyDeleteHoly shit I sold at exactly the same price!
DeleteI'm actually contemplating an add price for LEJU.
DeleteI hopped back into YELP at $67.02 instead, thinking there's a chance it rallies to $70 before fading again.
DeleteWow, looks like a bear market to me!
ReplyDeleteAdded more LEJU at $12.85, $12.92.
ReplyDeleteObviously no help to anyone now, but I sold out of LEJU this morning around 13.95. Too busy with YELP, that dog.
DeleteHa. It's all good. Nice trade. I view LEJU as an ideal buy the dip candidate. The fundamentals of their business are extremely bullish longer term. Now whether or not we drop to $11 first who the hell knows.
DeleteI was this close to putting 30% of my portfolio into TZA into the close yesterday based on a gut feeling I had. Oops.
DeleteI will say this about YELP...The reason it's down is because net adds on the biz accounts was below expectations. However, I remember clearly back in like 2006 or 2007 when I was buying up BIDU there was a quarter or two where people freaked out over the next adds of paying accounts and the stock sold off. This of course was quickly erased by the fact that the addressable market being so astronomical that it ended up being just a blip in hindsight. So maybe YELP just hired the wrong sales guys? Who knows. Fact of the matter is you're still talking about a market that is really big and they don't even have 1% of it. Sometimes it takes hand holding and educating the customer while the market realizes the benefits.
ReplyDeleteLet me guess...perma bears like Doug Kass and Rick Santelli are saying "I told you so", ignoring the fact they have been advising people to sell for the past 40%?
ReplyDeletePicked up some LEJU at $12.9 and YELP at $66.5 in my in laws accounts. Better prices on both than my own accounts.
ReplyDeletePCRX is saying F-U to the market.
My 14 year old niece, who is the prototypical teen and who I use in part to follow trends, asked for a GoPro for her birthday. 2 birthdays ago she asked for Uggs (when DECK was at $40). I asked her what was so special about it vs the others and she said its water proof and is just cool ie everyone else has one or wants one. I have my doubts longer term but they definitely tapped into teenagers desire to share their lives with their friends and get attention for themselves.
ReplyDeleteMy daughter just got home from spending 7 weeks in Europe and said the GoPro's were very popular. All the Australians they met had them, plus a bunch of other people. Seem to be really hot, not sure if the stock price already reflects this though.
DeleteYeah that's my gut feeling, that its priced in, but I was surprised to hear my niece's take on it. Wouldn't be surprised to see it run to like $100 even if the long term viability doesn't play out.
DeletePull up a chart of the S&P 500 in 1996 after it went on a huge run in 1995. I think the SOX is mirroring it. This dip seems like it should be bought in the bigger picture. Remember this is a 13 year breakout.
ReplyDeleteBack to even on the day for YELP. Is it ok to beg for a buyout rumor?
ReplyDeleteTempting to do a bit of buying today. Doubt that this is the bottom, but a few stocks are looking pretty good and, you never know, it might be the bottom and I'd hate to miss it.
ReplyDeleteI wouldn't go whole hog but I think it makes sense to buy in pieces on stuff you want to hold. All of the buys I'm doing today will most likely be short term trades because I suspect we think there's a decent chance of a bigger move down in a week or so. Who knows though. Better to just buy stuff you're ok with owning at lower prices if you have confidence in them.
DeleteAdded to my position in CGI Group (GIB). They had a good quarter and their outlook was good, so I feel like I am getting a bit of gift here being that it is pulled down by the broad market.
ReplyDeleteAnd added to small cap energy company TBE in Toronto. Management put a whack of their own money into recently at $1.80 and their management is good, so a good indicator, plus has a good yield.
DeleteStill have lots of cash as I do think we see a bigger pullback this fall, but the risk/reward has shifted a bit more to the good, so want to increase my exposure.
what's your basis in GIB?
DeleteLooks like the markets are going to be down for July. Was actually a very flat month until today. But will put some red on the monthly charts which is good.
ReplyDeleteHLF.
ReplyDeleteSold YELP for small loss (combined trades) at $67.16. Oh well. Got too greedy.
ReplyDeleteI ripped off a YELP trade on the back of the LNKD earnings beat. Bought and sold for a $0.40 gain in the span of 8 minutes. Helps lower the sting.
DeleteLNKD had really solid earnings. Helps when you're a monopoly.
Ripped off a short in TSLA at $227.5. I have no idea why...Oh yeah I guess because its trading at 225 times earnings.
ReplyDeleteAdded a short at $223.
DeleteI'm assuming it's lifting into the conf call. Prepared to close this out for a loss.
DeleteDamn that's one tough stock. Closed it at $223.85.
DeleteSold the in laws YELP at $67.22 after hours. 1%ish gain. Whoopie.
ReplyDeleteThe market trips you up every which way. I was so distracted by today's selloff I missed our weekly breakfast date with Jack Flash:
ReplyDeletehttp://finance.yahoo.com/echarts?s=UGAZ+Interactive#symbol=UGAZ;range=1d
The combination of HDGE + RYTPX + position sizing was a padded helmet. Saved me from a straight-on -10% head butt from YELP.
ReplyDeleteTOF, bought 80% of GIB.A in Toronto at $36.14 and added 20% today at $39.04.
ReplyDeleteBut average it out with the exchange rates and its around $33.60 US. Bought it all in the last 2 months. I had bought it earlier this year and sold it for about a 6% profit. But, I've done some more work on it and I think it is a good one and decided to go back in. I plan to hold it for a while, but who knows.
YELP - My target was off by a penny once again!
ReplyDeleteGIB Update from TD:
ReplyDeleteEvent
Adjusted EPS we would call in line; CFO was strong relative to expectations.
We term the quarter mixed due to in-line revenue and a 92% book/bill. We
maintain a BUY rating and $46 target price.
IMPACT: MIXED
European revenue growth should resume next year. Europe revenue
is seen bottoming out in FY15 as strong trailing bookings (116%
book/bill) offset the pruning of unprofitable contracts.
U.S. federal bookings are expected to pick up in the next couple of
quarters. The industry-wide slowdown in CGI Federal bookings is
expected to ease; the company expects half of its $1.5 billion bid
backlog to be decided by calendar Q4.
The table is set for better overall top-line momentum in FY15.
Outside of U.S. Federal, the trailing book/bill is 113% in the U.S. and
107% globally. The combination of CGI Federal bookings improvement
and better European top-line momentum should return CGI to overall
top-line growth next year.
Our near-term revenue assumptions are trimmed modestly. We now
model EPS of $2.81 for FY14 (from $2.85) and $3.11 for FY15 (from
$3.19).
There should be no lingering concerns over cash flow. Two
consecutive quarters of about $350mm cash from operations (despite
ongoing integration payments) puts CGI on track to hit or exceed $1.2b
annualized CFO in our view. This maps to almost $1b in FCF or about a
7-8% FCF yield.
M&A: CGI is "in good shape, financially, to move". The
debt/capitalization ratio is down to 32.6% long-term debt facilities could
provide the stability to go after additional acquisitions. Stated target
areas are in the U.S. market (presumably more on the commercial side)
or additional IP-based solutions.
TD Investment Conclusion
There is no change to our BUY rating and $46 target. Our target assumes
CGI trades to 8.6x fwd EBITDA in 1 yr – a slight premium to the 3-yr
median of 8.1x given what we think is a more diversified platform. Accenture
trades at 10.1x forward EBITDA and the peer median is 7.4x. We think a
sharper rebound in top-line growth momentum or additional M&A could
drive upside to this valuation.
Man I'm going to have to jot this one down...so many calls to go through. PCRX just sticks out to me as a blockbuster report. I really think that thing is going to be a multi bagger from here, even after the big move it has had for the past few years. We're talking about a game changer drug (Exparel) that is getting adopted rapidly by the doctor masses. Look at these total account numbers just the paste handful of quarters:
Deletetotal accounts
2,815
2,452
2,106
1,732
1,435
1,065
Also from TD, their Quart guys see stocks rotating from value to growth:
ReplyDeleteWe believe that equity markets are making what we would describe as a rotation
back to growth stocks from cyclical/value stocks. This is most evident in the U.S.
with the recent relative strength in the large-cap S&P 500 Technology and Health
Care sectors. At a sector level, this relative strength is largely coming at the
expense of the Consumer Discretionary sector, which is traditionally an early-cycle
sector and, most recently, the Industrials sector. At this stage, the rotation to
growth is not a bearish trend, as the very defensive U.S. Consumer Staples and
Utilities sectors remain relatively weak. If these sectors began to outperform, we
would be more aggressive in reducing our cyclical exposure.
Equity markets appear to be most similar to the 1997 to early 1998 period when
large-cap U.S. growth dominated relative performance (Exhibit 6). This was also a
period when commodities were weak in a slow global growth environment and the
U.S. dollar was relatively strong. With Energy prices at risk (see below), we
believe that a lower Canadian dollar is probable.
As we discussed in recent weeks, macro indicators such as the decline in global
interest rates, flattening yield curves, year-over-year declines in commodity prices,
and the plunge in the Baltic Dry Index are not conducive to a cyclical rotation, in
our view. In addition, weak seasonal trends for most commodities, particularly oil,
in the late summer/fall is causing us to reduce our cyclical exposure. At the same
time, we expect the scarcity premium in Canadian defensive growth names to
continue rising. We also believe that Canadian financials stand to benefit,
particularly if energy, as we expect, continues to trade lower through the fall (see
below).
Interesting take. Yeah the cyclicals aren't doing all that well, huh? at least in the shipping space. AA is doing well though and I would consider that a cyclical.
DeleteI've been looking a little closer at the 97/98 period and it seems like we would at least pause here in the selloff. I don't see anything like the 98 contagion issue at hand, especially since China is re-accelerating, and Europe is not doing down the tubes, as much as people would like us to believe. Perhaps we do get a QE induced sharp selloff but that wouldn't come until a few months from now I would presume. I am willing to put some money on the idea that this is all part of a range bound trade for the next few months before breaking out to higher highs.
Don't buy energy, yep, it's been weak day after day.
DeleteSNE - Sure did pop up.
ReplyDeleteinteresting here;
ReplyDeleteUGAZ, UNG SGEN
also
PCRX on pull back, ENDP and maybe YELP redux
How about graphite for TSLA lithium batteries?
ReplyDeleteBXE - Ouch, no bottom on this one b/c they can't compete with US producers.
ReplyDeleteNew all time low for my trading account, BXE is dead meat.
DeleteEvery day another dime, so would have to buy a $0.20 drop and flip it
DeleteSPWR- That's about a 13% drop in 2 days.
ReplyDeleteYeah I've been watching that one closely. Not sure where the entry point would be but its probably not the best bounce candidate when the market stops selling off.
DeleteDow is down for the year now. Wow.
PCP - Looks like a bull flag, complete with gap down.
ReplyDeleteSPX coming into trendline support from the Nov 2012 lows at around 1910 or so.
ReplyDeleteI figure 1895~1900
DeleteGASX - ?
ReplyDeleteTSLA - Nicely green, thus seems to be a growth stock?
ReplyDeleteRussell 2000 continues to track the 1981 market almost to a T
ReplyDeleteIsn't 1981 the period markets worked considerably lower?
DeleteYes. I think the Russell could have a rough time over the next year. The valuation is horrible and you have major headwinds working against it if rates move up. Not sure about the latter. I still think we see a rally in the small caps to 1180ish first.
DeleteThat is, after a re-test of the May lows in the russell....
DeleteEric Cantor is a crook too, not just Bob Rolex.
ReplyDeleteSPWR miss was due to capacity constraints not a slowdown in demand. I think it's a buy.
ReplyDeleteLong SPWR at $34.5. Small position to start.
ReplyDeleteI'm going to let her come to me. Will add in increments of $1. I'm eyeing the gap down at the very least in the short term.
DeleteI see no low risk entries in the stock market. There are two trades I like outside the stock market:
ReplyDelete(a) Bonds. TLT (the long bond) appears to have found support following a shallow retracement (not far from where I exited the opposite trade in RYJUX on Wednesday). Long RYGBX at the close.
(b) USD. The dollar had its best monthly performance in two years in July, and is due for a retracement. Long RYWBX (Rydex Weakening Dollar 2x Strategy) at the close.
A low risk entry in my opinion would be if we get a minor bounce then a follow through downside move that brings the Russell down near May lows. I suspect we get the minor bounce early next week. I'm finding a lot of interesting stuff though.
DeleteI tried to short LOCO today at $41+ but got the following message:
ReplyDelete"Shares of this security are currently not available to short sell."
I know this chain well. It's ok food, nothing to write home about. Their balance sheet is a mess. They trade at 5 times sales (same multiple as CMG, 3X PNRA) and at 75X annualized EPS in Q1 (keep in mind they haven't turned a profit in the past 3 years)
Talk about riding an elevator, feels like an hydraulically assisted elevator and much faster than a Mitsubishi elevator in the Shinjuku Mitsui.
ReplyDeletet3d- How are you holding up? How many more cycles before you're done?
ReplyDeletePII - So glad I don't own this one else I'd have to crow.
ReplyDeleteUGAZ> reopened a small position near the close at 14.0x. Let's see if I can hold this into the twenties.
ReplyDeleteSMP - Pretty tight correlation, huh?
ReplyDeleteNotice Korea's move like KB and PKX, and the effect Europe has had on China in the past. Is it time to think about catching Europe while fear is high?
ReplyDeleteEWG ?
ReplyDeleteNotice how IRE is building a nice little base while Europe is "collapsing"?
ReplyDeleteOUTR - Taking off?
ReplyDelete