China just announced a plan to invest $168B to accelerate Urbanization. I do believe if their economy is truly slowing that we are going to hear more and more about stimulus type measures to support it. VALE should benefit from such spending it would seem.
Could very well have been shorts covering at end of day to take their gains and avoid holding over night.
Could be to some extent. Most of these large stock deals are followed by a period of selling pressure until the selling exhausts itself and the synergies are realized a quarter or two down the road. A lot of the early synergies in this deal appear to have been forfeited with the higher purchase price. Nonetheless, we are trading back at a 10%+ distribution rate and, unlike not too long ago, the distribution appears secure with the potential to be raised over time and the SEC overhang seems to have been resolved (meaning also the business model is in tact). I am willing to be patient and add on the dips.
Cramer has been all over the map. He's too emotional with his investments for my taste. He touted LINE as a very well managed business when he started buying. Now, he is selling it because he says they are poorly managed. If he makes money, he makes up reasons why he was right. And, when he loses money, he makes up reasons why it wasn't his fault. It's just how he rolls. I like the 10%+ distribution at this level and will continue to add if it goes lower. Once they start getting the BRY deal synergies figured out, the stock should do just fine.
With the distribution apparently secure, it's hard to be wrong here at these prices over time. Short-term, who knows. I picked up more LNCO today for my Roth to bring my APP below $29 and will continue to hold my long LINN position unless something fundamental changes in the outlook. GLTA
And if you go back a few years, you will see this is the fourth bottom at this level (if it proves to be a bottom). I bought today at $12.65 for another trade around my long position which is at just under $14.00. I expect either China will produce better data in the near-term or they will announce stimulus. After confirming their determination to achieve 7.5% growth this year, they aren't going to sit idly by for long.
I keep trading around my $14 long position. It seems the floor has been in the mid-to-upper $12 range. I bought on the last dip at $12.75 and sold at $14.40. I will wait and see if it hits the $12.75 level again before buying for another trade. GLTA
China has reiterated they are determined to achieve 7.5% growth in 2014 which suggests that they will invest to make it happen and not worry quite so much about debt and austerity which has plagued VALE in recent weeks. This should be good for iron ore manufacturers and especially VALE since they are viewed as dependent upon China. GLTA
I see a lot of posts suggesting that the excess cash is needed to cover the additional shares issued in the BRY acquisition, but that is not exactly correct. They did not recognize BRY contributions in the cash flow beyond the amount of time they owed the new shares. So, the question is how much will a full quarter's cash flow contribution from the BRY deal be v. the added dilution. And, it should improve over time as synergies are realized. Still, I missed the call, so don't know if it was covered, but there must be a reason why they didn't increase it today.
Whisper EPS was for 50 cents or less so the 62 cents was positive, even if 2 or 3 cents below analysts' average. Cash flow of $6.6B was 10% higher than expectation while margin of 48% was in line. They will issue no debt in 2014 and plan to use any excess cash flow to pay additional dividends or buy-back stock.
I was favorably surprised by the expectation for base metal cash flow contribution in 2014 of an incremental several billion dollars as well as the "green iron ore" program as another opportunity for VALE to realize higher prices than the norm.
We should see some upside movement in the coming days IMO. One day, the valuation will have to reflect the performance and when it does this is a low- to mid-$20's stock.
I'm not surprised given the run up recently that we are seeing some sell the news profit taking here. But fundamentally, the report is strong, so I am holding my LINE and adding to my LNCO position and looking forward to the next distribution. GLTA
How do they beat analyst estimates for revenue by $1B and miss by 3 cents on EPS? Perhaps when I read the details it will become clear, but on the first surface read, it's perplexing.
62 cents fully diluted and excluding one-time tax settlement and Rio Colorado hits. However, cash flow is a much more important number for VALE and it was up 49% YOY.
Very strong increase in cash flow (+49%). Solid 8.5% increase in revenues to $13.6B. EPS, excluding non-recurring items, of 62 cents. I believe street EPS estimate was only 26 cents.
I expect they will deliver a very solid quarter, solid guidance and an increase in the distribution to the previously contemplated $3.08. GLTA
The market may retest the recent correction on a macro level and could take LINE/LNCO with it regardless of the bands. However, I bought LNCO today for a trade into earnings (I am long LNCO in my Roth's and LINE in my trading account). Earnings should be strong, guidance should be strong and they may increase the distribution. GLTA
The institutional holders will go with the ISS recommendation against Icahn's proposal. As such, it is dead at this point. That doesn't mean Icahn won't squawk until the vote is in to feed his ego, but the vote is not in doubt.
The $12B was bought through institutions directly while the $2B was bought in the open market. Going to the institutions gave Apple access to large quantities of stock without materially impacting the open market price.