Yeah its not a real big deal but with sss constantly dropping it amplifies losses. Dont see how it would be made up in prices as sales are falling
thats the problem with continually dropping same store sales, expenses dont go down with them. Well over 10% of Sears' stores are in California which will see another minimum wage boost next year to $10 per hour and almost certainly pressure sear's bottom line in the state. And now with the REIT, if they want to close a location they'll need to pony up a years worth of rent.
book value is often a very poor measure as it is in this case, but the point is that Sears couldnt survive in its current form and adding $157 million in rent expense only insures their downfall. If they somehow limp to 2018, they'll have some very expensive debt to refinance.
yeah 2nd quarters definitely turning into a bit of a struggle for BNSF. This last week was particularly poor with carloads down 9.69% and Carloads+Intermodal down by 2.38% although there were some special circumstances this last week. For the quarter, carloads down 2.7% with carloads and intermodal essentially flat. The mix is also less favorable with Higher Revenue grain and petroleum being somewhat lower while lower revenue coal is up modestly. Longer term though, I think BNSF does just fine.
It sucks to see a CEO that seems to be overcompensated, especially if performance starts to drag. The truth though is, even if Rometty does get somewhere around $15 million a year, that's still well under 1% of IBM's annual earnings and it is reasonably tied to performance.
you have to search the title. He's referring to an article by bill gates called 50 years of Warren Buffett's wisdom
And yet they still have significant sales. As long as you can cut costs agressively as 3g has done with heinz and not have sales fall of a cliff, you should do just fine
Investment income last quarter: $875 million, total operating earnings $4.244 billion
yeah, i was a bit surprised to see an add to WFC, he hadn't touched it for awhile. Starting to get close to that 10% threshold now
Its not a bad play, I haven't looked at HOG for a long time. They definitely have some struggles right now but I think their death has been greatly exaggerated.
yeah its definitely come down a bit here, seems like a reasonable play. Of course, like BNSF capex regularly exceeds depreciation although lately not nearly in as significant in a way considering whats been going on with BNSFs network. But it certainly affects true earnings. Although partially offsetting that is the deferral of income taxes which is a liability that regularly increases benefiting true cash flow. Net cash flow has been about $3.5 billion lately, probably not materially different this year as capex has remained at 4.3 billion. So that makes $90 billion seem pretty expensive at about 25 times cash flow but if you can finance capex at low interest rates and the business continues to grow, then it could still work out quite well. That's essentially the BNSF model, issue debt for any capex over depreciation and return net income to shareholders.
But in all reality, it was never IBM over brk. It was IBM over sitting on even more cash
If you can buy for close to the 1/1500 ratio, you'll do very very slightly better in a class A share as A can convert to B and tends to do so when markets are less than efficient. As a result, the A share count continues to drop with only ~826,000 shares outstanding down from 938,000 3 years ago, so soon A shares may be rare company indeed. For now A and B are both about 50% of market cap. You do lose a little bit of liquidity but A is still pretty liquid and you always have the option to convert.
However, there are quite a few advantages to B shares too. If you own in within a taxable account its much easier to control gains on sale to minimize taxes. Some people are in tax brackets with no long-term capital gains (for married people up to taxable income of ~$93k) and if you're going to sell at some point it will be much easier to control the sale of B shares to still not incur federal taxes. In the case of a tax loss its also much easier to realize with B shares.
Another thing to consider is that you're also increasing your position significantly, nearly quadrupling it to a $222,000 position. Thats a big decision to make, and almost certainly a bigger decision than whether you go A or B