The value to Einhorn is the 2&20 he gets on the portfolio PLUS any increment earned by the reinsurance business. It is a zero-cost call on reinsurance performance. The problem is that the reinsurance business sucks right now because there is so much capital chasing too little demand. On top of that you have the fraudulent creation of captive reinsurers hanging over the market.
I am waiting for $46/share. Agree that there is value destruction here, but I don't see any long term value to VZ. Everyone seems enamored with content and platform delivery. Who is going to buy enough stuff to justify the costs?
Well, ZACK's rated it a Strong Buy today which is the reason for the price drop. Sophisticated investors do the opposite of what Zacks recommends in my experience. Peter
Did not listen to the call. Results were somewhat boring as is the stock. Just a very safe, steady earner that will not create any sleepless nights. Could be pressured by the rising dollar (discussed in the call?), but will work though it as usual. 3% yield in a safe stock is not bad considering the low risk. Peter
$1.00 would value AXPW at about $100 million! That sounds about right for a company that makes carbon electrodes for which there is no demand!
Now, you guys are getting it right. It is the value of the combined NOK/ALU that counts,not the prices today.
Your analysis provides no value for ALU in the merged company, net of existing debt. Hard to believe NOK would give up that ownership for no additional value. IMO, the whole pricing scenario represents one of two things (1) I am grossly stupid after being in this business for 50 years, or (2) the market really thinks that NOK/ALU is worth about half of the sum of the parts. Pricing here makes no sense except for traders who move tens of thousands of shares on the momentary come and go. I'm holding my ALU shares for future value at this point.
I'm buying too at these levels. The opportunity for margin improvement goes up with declining or leveling oil prices as long as management is on top of its game. This company has good management and is a solid long-term play.
I agree. I picked up another 1,000 shares during the "sale". Some big player seems to be feeding shares onto the market in a cash raising program. This is a terrific long-term investment as the East Coast isn't building any more refineries in the near future. Good management, too. Having Seth Klarman owning 10% isn't too shabby company. Peter