stlplaceYou Tube video: John Templeton interviewed at Wall Street Week at PBS. He was talking about the market in 1989: Germany; Japan stock market hit the top and started going down; Hongkong; US, etc.
John passed away today, at age of 95.
This Friday will be another big day for the Apple fans, the 3G iPhone will be unveiled globally. The past weekend I stopped by the local Apple store, I have not been to there for 6 months so my impression maybe more genuine. Besides the iPod touch (iPhone was absent), I found some of the sales associates are incredibly young, they look like high school kids. This reminds me many high school kids carrying MacBooks at the county library. So in a word, Apple was doing peer to peer marketing here?
What’s the use for iPhone?
I saw this question posted in Trader1688. Don’t laugh, this is a legimate question. My initial thought is the usual stuff such as MP3/video playback, web browsing, GPS,…as desribed in its offical web page.
GRE analogy problem
China GDP number: politicians vs.
Corporate earning: executives stock options
Hint: the local officials pump up the GDP numbers so that they can get promoted; the corporate CEO/CFO pump up the earning number so that their stock options will be more valuable.
Of course in an ideal world, when the law is enforced, those kind of things will not happen.
NBC will pay $3.5 billion for weather channel, weather.com and its related properties. News here. Hm, I think besides the travellers, people interested in the weather include commodity traders. The commodities range from crude oil, natural gas, heating oil, to crops. The reason goes like this, if natural disaster like Hurricane Katrina happens, it will destroy the oil and natural gas infrustures, and cause short term disruption of oil supply. The oil and gas price will jump. Similarly, if a draught or an extreme cold weather happens, crops and heating oil will be more valuable (again, disruption of supply). I think GE/NBC made a smart move buying the weather channel here.
Wimbledon
What a game. Weather played a factor too: the rain and the wind. Maybe it helped Nadal in some way? I was hoping Roger to win but I think he should have no regret (tried his best). One fun fact is the local NBC channel switched to baseball game (Cards vs. Cub), and we watched the game via UUSee web TV (Beijing TV 6). I also like two players comments after the game:
21:24 – A surprisingly stoic Roger Federer not letting any emotion out: “I tried everything, it went a little late and everything, but look Rafa is a deserving champion, he just played incredible todayÂ…. He’s the worst opponent on the best court, but it’s been a joy again to play here, I know I couldn’t win it under the circumstances, but I’ll be back next year.”
Amid the terrible market and paper loss in my brokerage account, I was doing some soul search: general market condition aside, what went wrong in my investments; new ideas?
I came across this Cal-Maine foods from the latest Barrons, Egg Fight: The Yolk’s on the Shorts. We all know the egg price went up quite a bit recently, so as the stock of Cal-Maine (Nasdaq: CALM). From July 6 2007 to July 3 2008, the stock was up 75%.
So I went to Cal-Maine Investor Relationship web site and started reading. Some interesting facts from reading its fiscal 2007 annual report, and its investor presentation.
(Update July 8) More about the value of SPRD. Last month Datang sold its 32.1% stake in TD chip maker T3G, for 122 m CNY. This values T3G at (122m) / 32.1% = 380 m CNY. That’s $54.3 m (assume $1 = 7 CNY), and I will use that number for the TD business of SPRD. From the outcome of two rounds of China Mobile TD handset bidding, we can say SPRD TD biz is about the size of T3G. As of March 31 2008 SPRD has $97 m in cash, minus total current liabilities $28 m, that’s a net cash of $69 m. As of July 8 the market cap is $199.85 m ($4.63 per share), that values the 2.5G/2.75G business of SPRD at $76.55 m (=199.85 – 54.3 – 69). Note the revenue of last 12 months is $158.80 m, and the company was profitable.
(Original) First, on the book value. According to Yahoo Finance and company Q1 2008 financials, its book value (equity) is $257.5 m (4.858 per ADR/share), market cap as of July 3rd is $192.94 m ($4.47 per share). So the price book ratio is 0.92 (=4.47/4.858).
Now some interesting stuff I read from its annual report:
1) Page 39, Customers: For 2006, one customer accounted for 14.5% of our revenue, and no other single customer accounted for 10.0% or more of our revenue. For 2007, two customers each accounted for more than 10.0% of our revenue: 37.1% and 10.6% respectively. As our business expands, we expect our overall customer composition as well as the identity and concentration of our top customers to change from period to period.
Obviously I pulled trigger too earlier on this one, SpreadTrum Communications (Nasdaq: SPRD).
Here is a Speadsheet which has the revenue numbers for recent quarters. I think one reason for the continued pressure is the slow cell phone market, as indicated by the shipments slowdown of MediaTek, a bigger rival of Spread.
My current plan: sell some before its Q2 ER. The company revenue guidance for Q2 was $39 to 40 million. It could miss because of challenging macro economy condition and intensified handset market.
BTW, this morning I sold the Yahoo shares which I bought it yesterday.
(Update July 7) Microsoft and Carl Icahn appeared to team up and will try to ouster the current board, esp. CEO Jerry Yang. I don’t think the current board and management is toasted because:
1) Two co-founders Jerry Yang, David Falio, along with their friends Softbank, Alibaba have more shares than Carl Icahn and his friends;
2) They will fight for the support for institutional shareholders, such as Legg Mason Bill Miller etc. Some of the institutional shareholders bought the YHOO shares much higher than the price Carl Icahn bought recently. Unless there is a liquidity problem, those “higher cost” YHOO share holders will hold on it and try to get a higher exit price.
(Original) Yahoo (Nasdaq: YHOO) shares are back to pre-Microsoft bid days today. So I went ahead of grab some shares.
The buzz on merger and proxy fight aside, I think the business and the brand of Yahoo worth more than the stock price today. Interestingly Yahoo board and management put up this power point presentation at SEC web site, to persude stock holders not to side with Carl Icahn’s proxy fight.
(Source: business week)
Recent market turmoil reminds me 6 years ago: Enron, WorldCom and Tyco scandals are all in the news. Even blue chip names like GE and Xerox have some corporate governance problems. GE gave excessive benifits to retired chairman Jack Welch, the benifits including Manhantan condo, free corporate jets, season tickets to Yankee baseball games etc. Xerox had to re-state its financial statements (I remember got this news from Chinese newspaper when I was in Shanghai, summer 2002). It seems the corporate bean counters can not get the numbers right. That’s when I started to invest in the US stock market (sharebuilder), although in very small amount.
Shortly after we got Sabane Oxly Act, which targets the corporate internal control and financial reporting (GAPP). I remember in dot com days all the internet companies used “pro formula” (non GAPP) to tell the fairy tales to the investors. April 2003, US invaded Iraq. The US stock market bottomed there, and took off until the recent sub prime debacle.
When will the current bear market bottom? I don’t know. But one thing I know is the market go down, and goes up…all the time, as said by famous fund manager Peter Lynch (Lynch’s take on market, mp3, 5 mins)
This is probablly the most expensive lunch: Chinese fund manager Zhao Dan Yang won the Buffett lunch bid for $2.1 million (International Herald Tribune). The proceeds benifit Glide foundation, a San Francisco based charity formerly supported by Warren Buffett former wife Susan Buffett (Susan passed away in 2005?).
My 2 cents
I was surprised by the amount initially. This amount is almost 3 times of last year winning bid. Perhaps because Buffett is getting older? Also Mr. Zhao must have significant personal wealth to pull off that, no small change for fund managers, because fund managers make money from fees and profit sharing (2-20 rule, I will write more about fund manager fee structure later).