Sat, Sep 20, 2014, 12:02 AM EDT - U.S. Markets closed

Recent

% | $
Quotes you view appear here for quick access.

TORM A/S Message Board

j0n_48195 96 posts  |  Last Activity: Sep 15, 2014 11:41 AM Member since: Apr 2, 2001
SortNewest  |  Oldest  |  Highest Rated Expand all messages
  • j0n_48195 j0n_48195 Sep 15, 2014 11:41 AM Flag

    According to the WSJ article posted on Yahoo, the worst case is for AIG to be on the hook for $40B if the treasury is found guilt, as. AIG assumed liability for any government misconduct. That would be a huge miscarriage of justice, IMHO. Punishing the shareholders twice? Only in the world of legal logic does that make any sense at all. You know the lawyers would get their 30% and most small shareholders would never see a dime. Nobody expects Hank to win, but if AIG paid him one penny to settle this out of court that's a rip off.

    Sentiment: Buy

  • Reply to

    After Hours ???

    by echo_sph Sep 10, 2014 5:24 PM
    j0n_48195 j0n_48195 Sep 11, 2014 12:47 PM Flag

    What's your point? None of that has anything to do with the financial performance of the company. The more hated, the cheaper the shares being repurchased. Stocks that look ugly in the market often offer the best value.

    Sentiment: Buy

  • Reply to

    Listen...

    by sileonienrique Sep 4, 2014 3:07 PM
    j0n_48195 j0n_48195 Sep 10, 2014 4:49 PM Flag

    I'm guessing you meant that post for sileon and not fabr1.

    Sentiment: Buy

  • Reply to

    Citi starts AIG at a buy PT 68

    by geepersman3 Sep 8, 2014 6:56 AM
    j0n_48195 j0n_48195 Sep 9, 2014 8:21 AM Flag

    I think AIG is buying, but not that much, Figure them spending $2B per quarter. (They could spend more, but I doubt even that much.) With 50 trading days, that translates to $40M per day, or about 700,000 shares/day. That's not enough to stand out in the charts, but it does account for why the price of the common has been less prone to swoons than the warrants. There's no reason why the warrants should dip twice as much as the common in dollar terms (not to mention percentages), but they often do.

    Sentiment: Buy

  • Reply to

    AIG Warrants

    by chxfhx Sep 5, 2014 5:08 PM
    j0n_48195 j0n_48195 Sep 8, 2014 1:09 PM Flag

    The warrants are so thinly traded, they often diverge from the common in trading. I've said before that a smart trader could take advantage of that, but I'm not that smart and already all in. We warrant holders just have to "groan and bear" it. Pun intended.

    Sentiment: Buy

  • j0n_48195 j0n_48195 Aug 31, 2014 11:14 AM Flag

    There's no reason why AIG cannot become as profitable as Travellers. Using big data to rationally price policies and operational efficiencies will take time. Both will pay big. But there's more to running a company than management systems and computer programs. It still requires "big picture" vision and people skills. AIG can handle the technical fixes. They have no choice. But leadership requires some intangibles that will not be proven until long after the technical fixes are in place. Greenberg let the nuts-and-bolts side of the business outgrow him. But despite his flaws, he was a driven leader. Let's hope the new guy has some of that too.

    Sentiment: Buy

  • j0n_48195 j0n_48195 Aug 29, 2014 3:30 PM Flag

    I am sympathetic to your point of view. I think Hank Paulson dumped much of the financial problems of his friends' companies onto AIG, then made AIG agree to surrender on terms dictated by the treasury. In hindsight, it was a bit heavy handed, but more out of panic and confusion than malice. But that's not why I'm responding. I have more practical questions: To what extent would any settlement in favor of Greenberg help current shareholders? Would that affect AIG's deferred tax assets? Would it be worth it for AIG to keep reliving their darker past through the press, almost certainly damaging a reputation they've worked so long to rebuild? Greenberg has nothing to lose and everything to gain. I'm not so sure that's true for the rest of us.

    Sentiment: Buy

  • Reply to

    New Article on AIG Warrants

    by sunshinemink7 Aug 27, 2014 3:44 PM
    j0n_48195 j0n_48195 Aug 27, 2014 5:10 PM Flag

    I hear you about those documents. They're like reading a foreign language. Even if you understand the words, you have to re-read them several times to get their meaning. In the meantime, narcolepsy seems to take over. As for SA and Motley Crew... I mean Fool, they're mainly in the newspaper business. Facts are important, but creating a compelling story is their main mission. I see these writers as sharp ambitious guys (mostly) trying to make a name for themselves by applying their college learning to the world of finance. They get credit for being idealistic and sincere, but often lack the kind of perspective that comes with losing money and learning from the experience. Knock on wood, we'll all make money on this gem.

    Sentiment: Buy

  • Reply to

    90% of Calif. residents lack earthquake coverage

    by kmx_swing Aug 25, 2014 3:37 PM
    j0n_48195 j0n_48195 Aug 27, 2014 3:29 PM Flag

    Agreed, but I can crudely quantify the downside. It's is also more immediate. The upside is more amorphous and "smeared out" over time. I know that the upside will dominate over time, but I need to be ready for that potential hiccup for the third quarter earnings.

  • Reply to

    A better way to look at the warrants. ...

    by j0n_48195 Aug 25, 2014 5:23 PM
    j0n_48195 j0n_48195 Aug 27, 2014 1:22 PM Flag

    As far as capital management goes, we're looking at a "turtle" strategy. Management will not do anything sudden or dramatic. Both dividends and buybacks will be ramped up incrementally- a few cents here, a couple billion there. The down side of course, is that the stock is a screaming buy right now and AIG is sitting on $20B in cash. There are some positives too though. AIG is being careful not to draw attention from regulators. More importantly, AIG's ho-hum approach to buybacks has kept the markets unaware of AIG's slow motion recovery. The stock has stayed at about the same discount to book for the last two years. The longer the better. They may ultimately buy more stock cheaper this way than a more aggressive program would allow. One thing I can say for sure is that the opinions of the warrant holders will have no effect on AIG's decisions.

    Sentiment: Buy

  • Reply to

    Cash is king

    by fabricone1 Aug 19, 2014 10:37 AM
    j0n_48195 j0n_48195 Aug 27, 2014 11:51 AM Flag

    Buybacks favor warrant holders and common holders equally. Dividends favor stockholders up to $.675 annually (in any 12 month period, not necessarily within the calendar year). Beyond that $.675, warrant holders are doubly compensated. But, as you point out, we all lose to the extent that those funds are not used to retire shares below book. It will all depend upon how close we get to book in the meantime.

    Sentiment: Buy

  • Reply to

    90% of Calif. residents lack earthquake coverage

    by kmx_swing Aug 25, 2014 3:37 PM
    j0n_48195 j0n_48195 Aug 26, 2014 4:34 PM Flag

    So you think they have 8-10% of that market? That seems high, but I'll defer to your expertise (since I have none) if you can back it up. We're still talking only a 10-12 cent hit before taxes - less that a dime after tax. And yes, I feel that pain coming with the return of a 100+ combined ratio. However, I think the analysts do a pretty good job "normalizing" those numbers. They can tell the difference between a blip and a trend. This may be a blip, but the trend is still good.

    Sentiment: Buy

  • Reply to

    90% of Calif. residents lack earthquake coverage

    by kmx_swing Aug 25, 2014 3:37 PM
    j0n_48195 j0n_48195 Aug 26, 2014 3:26 PM Flag

    In the paper this morning I saw an estimate of $2.1B insured losses. Figure 5% of that is AIG's (just a guess, anybody is welcome to improve upon that) and you get about 7-8 cents/share likely impact on cash flow, maybe a nickle reported loss after tax. That's not peanuts, but I'm guessing AIG sees at least a couple of these every quarter.

    Sentiment: Buy

  • Reply to

    Cash is king

    by fabricone1 Aug 19, 2014 10:37 AM
    j0n_48195 j0n_48195 Aug 26, 2014 11:10 AM Flag

    Yes! Though I'm far from certain that's really the case. Even a few hedge funds "hedged" that conclusion when they went public with this about a year ago. Even the pros sound fogged. It's in the prospectus on the AIG website, but even after you read it you'll think you're more confused, not less. See for yourself. Please. After you wake up from your coma, tell me what you think.

    Sentiment: Buy

  • Reply to

    Cash is king

    by fabricone1 Aug 19, 2014 10:37 AM
    j0n_48195 j0n_48195 Aug 25, 2014 11:51 PM Flag

    Finally, somebody who gets it. The number of warrants does not increase, but I'm sure you meant to say the number of shares each warrant can convert does increase. To exaggerate that effect, if the strike adjusted to a dollar (i know, ridiculous, but just saying), each warrant could convert approximately 45 shares at that price. So yes, sunshine is right too. Warrant holders are in no hurry to see dividends creep up to $.675, but once they get there, the more the merrier.

    Sentiment: Buy

  • With the conversion RATE, as well as PRICE adjustments for annual dividends over $.675 annually, it is so much simpler to think of each warrant being worth $45 WORTH of AIG common at the adjusted strike price. If, miraculously, AIG paid enough dividends to adjust the strike down to a buck, each warrant would then convert to 45 shares (NOT one) at that price. That means the warrants lose relative to the common for dividends paid up to $.675. Beyond that, the warrants are doubly paid. A 10 cent further dividend hike would have the effect of adding 20 cents to the value of the warrants (more actually, but it gets complicated)- even if AIG's market value remains flat. . One reason the warrants remain so cheap is that it's so hard to articulate this double (squared actually) adjustment to the warrants' true value.

    Sentiment: Buy

  • Reply to

    Cash is king

    by fabricone1 Aug 19, 2014 10:37 AM
    j0n_48195 j0n_48195 Aug 25, 2014 3:49 PM Flag

    I haven't read those posts in a while. Sorry, I probably won't. But what is usually overlooked about the strike price adjustment is that the warrants are adjusted so that YOU STILL SPEND $45 TO CONVERT EACH WARRANT. Why, you ask? Because each warrant converts to an equally proportioned amount greater than one share. In an extreme example, if the strike price was adjusted to $22.5 (no chance, but still) the warrants would also have been adjusted to two shares of common per warrant- further doubling their value. You would not pay $22.50 for one share of the common, but rather $45 for two shares of common PER WARRANT. A thousand warrants would now have the right to buy two thousand shares at that reduced rate. Really. Using a more likely scenario, if the strike is adjusted to $40, each warrant would then have the right to convert to approximately 1.1 shares. The share's "in the money" value would be bumped by the share conversion rate appreciation as well. So much for "demystifying" the warrants.

    Sentiment: Buy

  • Reply to

    Hated and manipulated

    by sileonienrique Aug 19, 2014 2:04 PM
    j0n_48195 j0n_48195 Aug 25, 2014 12:30 PM Flag

    Useful. Thanks.

    Sentiment: Buy

  • Reply to

    Who is the idiot stuffing the ask @ 26

    by geepersman3 Aug 21, 2014 2:57 PM
    j0n_48195 j0n_48195 Aug 23, 2014 3:48 PM Flag

    Exactly.. It's the kind of "medium term" psychology that reflects the reality of the new options landscape. They probably figure there aren't enough warrants available to move the needle anyway. There may be some regulatory differences in buying the warrants as well. It's nice to see somebody is taking advantage of this nonsense anyway. I would too, except I'm already all in. GLTA

    Sentiment: Buy

  • Reply to

    Hated and manipulated

    by sileonienrique Aug 19, 2014 2:04 PM
    j0n_48195 j0n_48195 Aug 22, 2014 3:35 PM Flag

    It is a rule. I looked it up several weeks ago. It was embedded on a very long winded accountant's page. Whose rule it is, I forget. SEC? Maybe. There are exceptions, but I think that 25% is still the working assumption. Sounds like AIG is buying too slowly to push that limit.

    Sentiment: Buy

Trending Tickers

i
Trending Tickers features significant U.S. stocks showing the most dramatic increase in user interest in Yahoo Finance in the previous hour over historic norms. The list is limited to those equities which trade at least 100,000 shares on an average day and have a market cap of more than $300 million.