International Business Machines Corporation Message Board

Thx, ksa... always appreciate your input here as well. S.

As LVS's assets and revenues have surged in value, it's EPS has not... but likely will this year.

Only a fool would have held this stock since late 2010... and then sell it now. S

Nice to see a reliable source confirm the story.
Thx, Blitz. S.

MHO is that the "beef" is described in UBS's commentary, and the points that I made.

When LVS first hit $55 in late 2010, it was due to the full realization of MBS's success after it opened 8 months prior to that PPS peak.

The most devistating impact on LVS going into 2011 was the realization of just how badly Steve Jacobs has damaged Sand's VIP junket relations. Sand's VIP business plummeted between mid-2010 and the fall of 2012... and was part and parcel to the collapse of Sand's gaming market share from 24% to 14% during that period of time.

Dab, if you're looking for one major reason for the stock going flat-line after late 2010, that would be it.

Other impacts came from China's "soft landing" and Sand's difficult "phased approach" to opening cotai central. Minor impacts came from the multiple court issues such as Jacob's allegations, Suen, and others.

From my perspective, 2013 appears to be the year that all of Sand's negatives get cleared up, as well as the year that all of their positives come to fruition (although I was hoping for 8% GDP growth in China this quarter)....

... and for that reason, I'm just as bullish on LVS as UBS obviously is.

Spok

Dish could be arranging any number of collaborative arrangements to support and buttress their bid for sprint.

Being clear over there in japan and outside of the U.S. market, Softbank is in a very weak position to be doing anything collaborative stateside other than the capital and higher credit rating they bring to the table.

Dish is clearly in the driver's seat. Even without visibility of all that they're doing behind the scenes, they offer the most commercial bang to the deal by far... and the best use of clearwire's extensive spectrum via High Definition video.

Did you see NetFlix's results today? THAT, is the sandbox dish strives to play in... and with far more distribution resources via sprint/clearwire than NetFlix could ever assemble.

If critical mass weren't so far into the future, I would buy stock in Dish... but there are better capital applications than that for the upcoming 2-year investment time horizon.

Spok

Just as Clearwire brass was pumping up expectations when they were trying to get people to buy the stock...

... now, I expect them to trash expectations now that they're trying to get sprint's ridiculous $2.97 buyout finished so they can collect their cashable stock option payoffs and head to the bank at the expense of the minority shareholders whose interests there were put there to protect.

I would say that the upcoming vote would be a battle... but it won't be, because opposition to Dan Hesse and sprint is very widespread and strong. Dish will do a MUCH better job of striking a clearwire buyout price that will garner the votes of large minority shareholders... a price that will also be good value for Dish.

S

Wow, that's a load of cr@p. This guy is on ignore in 10 seconds from now.

Nice synopsis, Blitz. The timing of your traunche's are very close to the timing of mine. Fortunately, I only dabbled at $8/share and backed up the truck when Crest bought their huge stake. Still, I don't make money on all of it at Sprint's ridiculous bid price...

... but I would today, if I were to sell at the market.

It's a large position. I'm a lot more anxious than Crest is to liquidate and reposition the capital.

S

Nice try. Show me a post of mine from this board from Clearwire's $17 dollar days and I won't call you Gomer, Gomer.

Not really. Opposition is overwhelming.

No, I don't see MGM as a BK prospect. I think they could re-gain profitability via cost cuts and careful management, but they are too saddled with aging resorts in mature markets to be any kind of a growth vehicle like LVS... which is in the hottest markets with big growth potential... albiet held down in price given it's recent EPS plateau borne out of China's soft landing, Vegas' slow recovery, it's awkward, phased approach to launching cotai central, and it's difficult rebuilding of VIP business which Steve Jacobs so badly damaged.

My concern is that by the time MGM were to edge back into to black (they are already EBITDA positive), the U.S. could experience another recession. When companies don't earn money, even positive EBITDA doesn't provide enough cash flow to replace depreciating assets and cap-ex must increasingly pile on debt... which is expensive for a junk-rated company like MGM... since they can't do it with after-depreciation-cash-flow.

I personally don't discern between a "speculation" and an "investment"... it's all real money to me and I don't take any financial committment any less seriously or well-researched as any other...

... once I've earned it... I'm NEVER playing with "the house's money"... it is MINE until such time as I should either lose it, or spend it. That's a good mantra to adhere to.

Spok

Dan Hesse has hammered clearwire over the years so badly that most minority shareholders would sell out to Pee Wee Herman for $2.75 a share before they'd give hesse their shares for $2.97. Dan Hesse has burned every bridge... the $2.97 bid is completely dead now.

Ergan brings a fresh perspective to Clearwire's situation. He has not shown a propensity to destroy clearwire as Dan Hesse has... or force a purchase of clearwire for a ridiculous price as Softbank's Mr. Son has done. Ergan is actually in a position to bargain with Clearwire for a price that is good value for Dish, but not a ripoff for clearwire shareholders...

... like many people out there, my impression of Ergan is that he is shrewd... but that he is fair and ethical and very much in contrast with the crooked ways of Dan Hesse.

S

Yes. Softbank needs clearwire's spectrum and is forcing the ridiculous, $2.97 offer to acquire it. They have over-paid sprint for 70% of that company on the assumption that they could effectively steal clearwire from it's minority shareholders... which obviously... isn't going to pass muster with the minority shareholders.

Dish, on the other hand, brings a lot of spectrum of their own to the table, and will not need all of clearwire's spectrum. By selling a portion of clearwire spectrum following a merger, they could essentially PAY for the clearwire acquisition at significantly more than the $2.97 that softbank is trying to steal the company for, and lower the cost of the total merger.

Dish is aware of what it is buying... and clearwire's net value in that package. Ergan is no dummy... once consummated, he would control almost 130% of the total spectrum bandwidth that verizon and AT&T control COMBINED. In a spectrum-crazy world that has evolved... Ergan's $25 billion offer is crazy like a fox.

S

MGM wasn't too big to fail as a result of "government assistance", which is the usual way that that term is applied following the crash of "08... but I get your point, my friend.

What helps MGM the most is Macau. The problem is, macau is only a "lifeboat" for MGM... not a driver like it is for LVS, because even once MGM opens it's off-strip, cotai resort in 2016, Macau will still be only a small part of MGM's portfolio of resorts given their massive presence in Vegas and their non-asian development business plan.

MGM will be a struggling resort operator for many years to come... and they will be very cyclical... eg: much more vulnerable to economic downturns than a company like LVS that is growing via far-east, mass market patronage that almost never declines in real terms...

... even during 2009's worst month, macau mass-market patonage grew 2%... and that's the worst month that was ever recorded since multi-concessionaire gaming was launched in macau.

S

Tell that to Edwardo Saverin, Bret... the co-founder of Facebook who took his $3 billion of IPO money and headed straight for Singapore. He's very content living there.

His $3 billion of investment capital... had it been invested in American companies and used to hire American workers... could have provided many THOUSANDS of american jobs if we had had a regulatory and tax structure that could compete with Singapore...

... Instead, our top corporate tax rate in the U.S. is the highest in the world... and our top individual bracket is the highest in the world outside of Europe. Our confiscatory government is driving our country's precious investment capital out of the country.

S

A clarification of that last paragraph:

Sands China has 9,210 hotel rooms on "Cotai". The company has closer to 10,000 hotel rooms once you include the Sands Macau resort downtown.

I'm not certain if Sand's hotel inventory equals 40 percent of the city's total supply or not... but their inventory is in excess of 50% of the total hotel inventory that is controlled by the 6 gaming concessionaires.

Spok

Singapore is a magnet for "investment capital" as the country has no capital gains tax, low taxes overall, and a reasonable business regulatory environment. As a result, when you look at a 40 year, satellite time lapse of Singapore, you can actually SEE it physically growing as robustly as their economy has grown financially.

If only the U.S. would stop following the Greek economic model, and follow Singapore's instead. Unfortunately, I don't think that's possible... as to many Americans want something for nothing and the American's with precious investment capital are heading for...

... yep... Singapore... to invest in THEIR country and hire THEIR workers.

S

Let me begin by saying I'm not a fan of MGM stock. I could be wrong... the best of them often are... but it doesn't meet my criteria.

As you know, I'm a contrarian investor who has tried to adhere to the lessons of Rothschild, Lynch, Templeton, Buffett, etc. for decades... and I've never doubted the lessons I've learned as they've worked well. MGM meets one of the criteria in that it is down, losing money, and is cheap. One could also argue that it meets the criteria of having potential, as defined by the fact that MGM is 60% Vegas exposure and Vegas is recovering.

My problem with MGM is that the "potential" is not evident in the company's internal business plan, but rather, is limited to the external macro environment it operates in. Vegas is in an upswing, but is no longer on a "growth" trajectory... it's a mature market now that will bear cyclical swings. MGM is in macau, but way behind there and years from building on cotai, off-strip, in an also-ran timeframe.

Sands boomed with the recovery because they had the right plan, with the right venues, in the right locales. MGM has none of that, so here we are, "mid-cycle", and they're still losing money and building 20,000 seat arenas in mature geographies. They are contrarian, but the requisite "potential" to grow on an inter-cyclical basis is not there, IMHO.

FTR, I'm increasingly going with low-beta stocks... semi-counter-cyclicals in the .40 to .80 range. Contrarianism is tough in a market hitting records, so outside of the emerging markets, I'm ware of cyclicals. M-REIT's are big with me now, as I look for the fed to end QE3 before they ease up on fed funds.

GLTY with MGM just the same though, my friend.

Spok

Good point... we're a nation of laws and companies should bear equal rights and responsibilities under them.

That said, certain aspects of American business culture are quite flexable... ethics, fiduciary responsibility, manipulation, etc. are not black and white but various shades of grey. I've personally had problems with regulatory agencies because I interpreted law or administrative code differently than such an agency. Sometimes, I accept their interpretation and suffer any consequences... and sometimes I file suit with the administrative law courts... especially when the evidence favors my interpretation.

Companies like Sprint are the most important reason WHY we have courts... because no law or administrative code can precisely address any specific circumstance. Sprint may have structured it's cashable options under the guise of performance... when in fact it's a payoff for chucking their fiduciary duties and toeing the line with sprint's CLWR bid... but perhaps a judge would agree that it was camouflaged well enough and worded well enough to allow them to get AWAY with such a payoff.

In the case of sprint... the shade of grey is appears almost black in the case of clearwire. Nobody with any objectivity could ever suggest that non-sprint clearwire shareholders have been treated in any fiduciary manner whatsoever...

... but in the end, the courts must decide... and if they're wrong, teamrep is right... it's incumbent on the minority shareholders to deliver a proxy haymaker to sprint's crooked jaw and move on to the next phase of nurturing it's huge, scarce, precious resource that everybody so very much want's a piece of.

Spok