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Tractor Supply Company Message Board

cohsgrad 38 posts  |  Last Activity: Oct 7, 2015 3:26 PM Member since: Feb 27, 2000
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  • Reply to

    Morgan Stanley bought shares?

    by baked421 Oct 7, 2015 2:09 PM
    cohsgrad cohsgrad Oct 7, 2015 3:26 PM Flag

    I don't know that they sold the shares to their clients. They may have just sold them into the market.

  • Reply to

    Morgan Stanley bought shares?

    by baked421 Oct 7, 2015 2:09 PM
    cohsgrad cohsgrad Oct 7, 2015 3:22 PM Flag

    They purchased from Apollo at well over $14 a share and resold to their clients (see prospectus filed 5/13/2015). Then they were hired to advise on restructuring alternatives shortly thereafter.

    Would be pretty surprising if they held a material number of shares. No regulatory filings indicate that they do.

  • Reply to

    Bond prices continue to plummet

    by yinkeyc Oct 1, 2015 10:32 AM
    cohsgrad cohsgrad Oct 5, 2015 10:29 AM Flag

    No one said the bonds wouldn't go to zero or be converted to equity at some point in time.

    It is worth something unless they are about to declare bankruptcy and while there are always possibilities of that happening, the most likely is that for some reason the line of credit gets pulled. If that does not happen and say they go two years while paying coupon you get 22 cents. At 25 cents it was pretty close to a no-brainer provided you don't bet the farm.

    Obviously, shares are even more risky and are a total bet on recovery in aluminum prices or perhaps if things go really well, alumina or rolling mills being sold at a higher price than I would expect. Unlikely but it could happen.

  • Reply to

    Does anybody know the status of share buyback?

    by furuhashiken Sep 28, 2015 10:06 AM
    cohsgrad cohsgrad Oct 1, 2015 3:10 PM Flag

    BOD authorization still exists but I'm pretty sure they have not been buying shares. In 2nd Q they purchased 1.2 million shares for $16.9 million (over $14 a share) so it seems pretty apparent they stopped not too far into the 2nd quarter.

  • Reply to

    Bond prices continue to plummet

    by yinkeyc Oct 1, 2015 10:32 AM
    cohsgrad cohsgrad Oct 1, 2015 2:14 PM Flag

    I'm not but one would have to assume the credit line is pulled in order for $25 to not be a buy. I can't think of any legal reason for it to be pulled but maybe there is something out there.

  • Reply to

    PR knowing my loss reserves

    by tesketax Sep 22, 2015 1:36 PM
    cohsgrad cohsgrad Sep 28, 2015 2:25 PM Flag

    MBIA management would agree with you. They go to great lengths to keep it hidden but it is hard to do so.

    I don't know what their reserves are. They have the big unearned premium reserve but that isn't specifically for PR.

  • Reply to

    Brief Conversation with John Parker (IR)

    by yinkeyc Sep 25, 2015 10:39 AM
    cohsgrad cohsgrad Sep 25, 2015 1:18 PM Flag

    Know I'm telling you something you already know but they will restructure if aluminum prices don't improve quite a bit. Barring the ABL line being withdrawn (something I can't imagine) it won't happen tomorrow but it would be inevitable in this pricing environment.

    They have continually talked about initiatives to lower costs in New Madrid but they have continually fallen short and in fact seen costs increase. Unfortunate, but true. Now they are increasing pay for all employees in the face of bad performance, I've seen it before and I'm not saying it is bad (with the possible exception of senior execs who it distresses me to see) but as the IR guy indirectly said, it is a risky position.

    Maybe there is a debt conversion coming. The bond and share price seem to indicate it but it isn't necessarily the right thing to do. It might be best to just go on and "hope" that aluminum prices improve.

  • Reply to

    Low float - list of shares holders.

    by donper618 Sep 24, 2015 6:44 AM
    cohsgrad cohsgrad Sep 24, 2015 4:11 PM Flag

    The main issue is aluminum prices, nothing to do with funds.

    They do have the rolling mills and alumina prices have diverged from aluminum so not completely tied to LME and midwest premium but it is their largest asset.

    Restructuring significantly more likely than a gain of six or seven times.

  • Reply to

    Low float - list of shares holders.

    by donper618 Sep 24, 2015 6:44 AM
    cohsgrad cohsgrad Sep 24, 2015 9:15 AM Flag

    Novel way of defining float you have there.

    Those institutional investors/mutual funds never sell or buy right?

  • cohsgrad cohsgrad Sep 23, 2015 6:27 PM Flag

    Wouldn't read too much into it. They reduced their targets because they knew they were going to fail them. Maintaining employee morale/comp. Sure BOD had good reason for change but it isn't real news.

    30% ownership constituting a change in control is frightening actually and can be construed negatively. The execs get to take out their deferred comp and receive big bonuses if say debt is converted to equity or someone buys just a very few shares (as 30% is so low). Kip Smith will not have as large a financial stake in the success of the company upon what might be a small transaction. I have a hard time viewing it as positive but share price is so low maybe the news of any sort of buying or conversion of debt to equity will be viewed positively.

  • Reply to

    By the way current assets remaim stable $347MM

    by donper618 Sep 23, 2015 3:39 PM
    cohsgrad cohsgrad Sep 23, 2015 6:14 PM Flag

    Aluminum prices were around $0.95 in 2nd Q, probably around $0.83 this quarter. Impact of roughly $15 million.

    Costs are higher due to electricity premium for summer months. Last quarter $.87 per pound. Sure catchup for bauxite levy is gone but on balance I'd say cost $.88 - $.90 per pound. so they are literally losing money on every pound produced. Lets say $5 million in additional costs for electricity.

    $20 million loss before considering impact of explosion which hopefully is covered by insurance. No way they will be able to push working capital management practices beyond the very good performance in 2nd Q. Finally, they will trigger the reduction in their ABL line of $25 million (which reduces borrowing capacity).

    $20 million cash burn is low end of reasonable range for 3rd Q. Could be a lot higher, could be a little lower but it will be ugly, ugly, ugly. After that, they might be able to whittle it down but they have to have some improvement in aluminum pricing to have hope of surviving on a long-term basis.


  • Reply to

    Senior Unsecured Notes

    by yinkeyc Sep 23, 2015 1:24 PM
    cohsgrad cohsgrad Sep 23, 2015 2:28 PM Flag

    At this point in time it is a wild guess but I'd go with $20-$30 million of cash burn.

  • Reply to

    Senior Unsecured Notes

    by yinkeyc Sep 23, 2015 1:24 PM
    cohsgrad cohsgrad Sep 23, 2015 1:56 PM Flag

    ABL comes due in Feb 2017. As it is secured by receivables and inventory I'd think it can be renewed but I guess one never knows for sure. No balance on it at the end of last quarter but there will be a balance on it this quarter given the losses they are generating in New Madrid.

  • Reply to

    Senior Unsecured Notes

    by yinkeyc Sep 23, 2015 1:24 PM
    cohsgrad cohsgrad Sep 23, 2015 1:47 PM Flag

    Its 2019.

  • cohsgrad cohsgrad Sep 22, 2015 11:50 AM Flag

    Really now? Why did they keep him on for all those years if he couldn't do simple arithmetic?

    Shouldn't you be saying something like, "You were right Greedy and I was wrong" about now?

  • Reply to

    $28MM market capital is a huge UNDERVALUE!

    by donper618 Sep 17, 2015 11:31 AM
    cohsgrad cohsgrad Sep 19, 2015 11:11 AM Flag

    Always wondered how much Kaiser put into that facility. When they acquired the 50% owned by Century in Aug. 2009 they allocated $195 million to those assets (and Jamaican fixed assets) so that sounds about right.

    Makes up around 1/4 to 1/3 of current Noranda fixed assets. My wild guess is that they could sell it for $80-$200 million.

    Would sure like to see Glencore's sell their alumina plant to get an idea of value. Glencore can't want to hold on to that asset over the long-term.

  • cohsgrad cohsgrad Sep 18, 2015 1:59 PM Flag

    If aluminum prices remain where they are, New Madrid would have a hard time surviving. Grammercy and rolling mills likely o.k.

  • cohsgrad cohsgrad Sep 17, 2015 4:01 PM Flag

    You aren't pumping hard enough! Post more frequently and with more enthusiasm as the company's future depends on it!

  • Reply to

    NORANDA is exporting metal to China...!

    by kapeller77 Sep 9, 2015 9:45 AM
    cohsgrad cohsgrad Sep 9, 2015 12:04 PM Flag

    Exporting alumina, not aluminum. China is in deficit when it comes to alumina so they have imported for years and will continue to do so. With Century shutting down Hawesville, maybe Mt. Holly demand for alumina in North America will be declining so going to China is a natural move. Not 100% sure but I'd guess margins are better too as the agreement with Century is at below market rates. Shipping costs obviously offset some of margin.

  • Reply to

    Aluminum Spot is up sharply today!

    by donper618 Sep 3, 2015 10:30 AM
    cohsgrad cohsgrad Sep 3, 2015 1:50 PM Flag

    Of course. They provide that in quarterly call. Answer that and you will see they are losing money on every pound of aluminum with possible exception of certain value added products that they don't break margin data out on. Overall though, it is clear that they will have at best a near break-even quarter (EBITDA) and probably a significant operating loss on operating basis for primarily aluminum ignoring the costs associated with explosion.

    I can' figure out alumina cost per ton for last quarter (or any period of time) as they don't disclose. Can figure out EBITDA relative to sales and operating income relative to sales but the figure is all over the place. My guess is that they will show revenue growth in alumina of roughly 10% QOQ due to China sale and they might earn $10 M operating income for the quarter off of alumina. Very tough to project. Might only be $5 million.

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