Stone Street Advisors's blog
Myself and others have discussed many orange and red flags with mobile device accessory company ZAGG. Here, I introduce two additional exhibits which don't exactly suggest the company is doing nearly as well as management and longs will have you believe.
When a company in a commodity market with no pricing power and questionable brand loyalty spends 1/3rd its market cap to buy another company in a commodity market with similarly questionable brand loyalty, investors have to consider that an orange - if not red - flag.
The SEC, along with the major U.S. stock exchanges, have "fixed" the problems with the reverse-merger industry. By "fixed" I mean they've essentially done nothing at all...
The answer to the question “How to Stop the Drop in Home Values” is not a matter of knee jerk reactions, more moral hazard, bad policy pushed through on a populist wind, or a problem you solve by principal reductions.
Mortgage principal writedowns may sound like a political panacea, until we consider the effects not only on borrowers, but on banks, and taxpayers, as well...
Pundits and politicians argue that widespread mortgage principal reductions for underwater borrowers will not only help "main street" but the economy as a whole. In reality, such actions are far from a panacea...
Who are all of these people in the top 1% of earners in the U.S? What occupations do they hold? The answer may surprise you.
Attacking the independence and objectivity of the ratings agencies due to their business model is easy, but it largely ignores the deeper problem: The ratings agency approach to credit analysis is inherently and impossibly broken, and efforts to reform it merely amount to tilting at windmills.
The stock is up 35% on news of a non-exclusive content deal. To sell content into a market unaccustomed to paying for it. How could this possibly go wrong?
Its one thing when Investment Banks use optimistic assumptions for revenue growth and margin expansion to "rationalize" a high price for its client's stock. Its another thing entirely to assume a Chinese company has the same level of risk as a U.S. one...
Imagine being told that you need to do something in life and you attempt to do it, but the person that’s very insistent that you do X takes his other hand and actively goes out of his/her way to prevent you from attaining X while each passing moment in time said person begins to label you as “lazy” or not trying hard enough?
We read about and hear it every day in the media, and accept it intuitively, but is there really a significant relationship between gas prices and consumer spending, or is it just another convenient excuse for when financial/economic data comes in below expectations?
What could possibly go wrong when a post-industrial town mortgages itself and (its future) to the hilt for a new Soccer Stadium?
Deconstructing Revenue Growth Assumptions Implied by Hot China Internet Stock Prices: Youku.com EditionSubmitted by Stone Street Advisors on 06/07/2011 12:00 -0500
The high-flying price of hot China internet stocks is driven largely by enormous estimated revenue growth, but if we take a closer look, the growth rates implied by stock prices are totally out of line with reality.
Is a Chinese internet video company that's hemorrhaging cash really worth $4.6 BILLION?