David Tsao

http://www.tengrandchicago.com

42 Comments

    • ON: Sun Oct 12th 11:27 AM
      Commented on:
      Reaching for the Bottom in the Markets
      I was thinking about checking out the time frames around 1929, but there was one specific reason why I didn't. Many of the instruments available to governments, banks, and other institutions were not available back then.

      The recent interventions aren't saying much to tame the market's wild rides... but over time the newly injected capital should drive a wedge into the fundamental economic situation and hopefully bottom out.

      As for timing this, that depends on your frame of reference.
      View article »
    • ON: Mon Aug 25th 10:03 AM
      Commented on:
      Raw Data Report: Harley Davidson, BMW, Daimler
      With respect to HOG, can you break down by geographic region? I'm just curious to see if HOG saw strength/weakness when compared to regions experiencing the the most pains with respect to subprime mortgages/foreclosures...
      View article »
    • ON: Sat Aug 2nd 22:02 PM
      Commented on:
      Know How Many Kindles Amazon Has Sold? 240,000
      Mark Mahaney also had AMZN price target for $119/share back in January. His forecast model back in May assumed there would be an adoption rate at 50% of what iPod's numbers when they first came out. At the end of the day, these targets may come to fruition, but the the forecast wasn't based on any sound reasoning.
      View article »
    • ON: Tue Jul 29th 21:47 PM
      Commented on:
      Amazon.com Likely to Remain Range-Bound for Time Being
      omooc,

      AMZN sold their European DVD rental business, while at the same time experienced a reduction in gross margins due to price promotions, Amazon Prime, and other factors. Breaking it out, they went from 27.1% in gross margin to 25.8% in North America, and grew 20.8 to 21.5% from their international channel.
      View article »
    • ON: Sat Jul 26th 22:18 PM
      Commented on:
      Amazon: Transitioning Into a Technology and 'Cloud Services' Company
      If you want to "get it" in terms of grid computing, there's another good book that makes the electric grid analogy called "The Big Switch" by Nicholas Carr.

      The one fault that I find with the electric grid analogy, is that what businesses and consumers leave behind during the industrial revolution and what they woud leave now.

      Leaving steam for the electric grid, versus leaving my blade server for a fully managed service environment present different incremental gains in terms of business continuity. Even if services like saleforce.com, Amazon's AWS, Google Aps, get to a level 99.999999% up time, there are still several hurdles to cross, some of the biggest challenges being:

      - data security/privacy
      - the up front systems integration cost to hook up company data/processes into to the "cloud".
      - new players need to enter the market to provide sufficient competition to open up my choices so as to not risk placing my company's critical systems/data into one company's platform.

      It is rather risky to accumlate Amazon stock solely on their AWS service (or the potential for it). Other market entrants are going to enter this picture, and until the Fortune 500 switch to cloud computing, this is going to be a very long evolution.

      I give Amazon kudos for making impressive revenues consdering the economic environment, however they continue to see margin compression with their promos/discounts.

      View article »
    • ON: Sat Jul 19th 01:30 AM
      Commented on:
      Harley's Beat: Was High Crude the Buffer?
      ronh,

      although Europe's auto business is showing weakness, moto's are a way of life over there. Have you ever hit any of the cities in Italy? People willing to shell out premiums for a Harley, will distinguish themselves from the Piaggio loving public over there. The same goes for India, where it's all about dinky Hero Honda bikes. I asked a fellow coworker when I was there last year if he would ride a Harley around the streets of Mumbai... "fantastic" is the word he used. Affording one is a different story, but in time things should look good for Harley in emerging markets.

      There is a good story the Chicago Tribune ran about Hog's versus Royal Enfields in India. An interesting read.

      www.chicagotribune.com...
      View article »
    • ON: Sat Jul 19th 01:21 AM
      Commented on:
      Harley's Beat: Was High Crude the Buffer?
      I would tend to agree with Mallarde, but still picked up HOG a few weeks ago. Harley's aren't about function, they're about image and style. Higher gas prices, makes looking good and feeling good more costly.

      I still bought HOG because they will turn around when the economy turns around. It's not often you can buy a classic piece of Americana at this price.
      View article »
    • ON: Tue Jul 15th 08:10 AM
      Commented on:
      Using the Magic Formula With Dividend Stocks
      A good angle. I'm currently testing his system, but at times I throw other filters on top of it (like PEG < 1, etc.), and run this picks through a DCF analysis.

      Now's a good time for these types of screens.

      View article »
    • ON: Tue Jul 15th 08:00 AM
      Commented on:
      Why I Bought Financials (Despite the Mess)
      The selling surge will continue. I admit it is hard to buy stocks in this environment, but some stocks are on sale now. I got into XLF a few months ago. Was it the bottom? Well of course not... that's easy to say now. They key is I took a small bite. If it continues to go on sale, and you believe the world isn't coming to an end, then now is a better time to feast on those quality companies you've always wanted to own.

      View article »
    • ON: Wed Jul 9th 20:03 PM
      Commented on:
      5 Sectors That Do Well in a Shrinking Economy
      Do you guys mean to do deep analysis like this?

      seekingalpha.com/artic...

      Sorry, I couldn't help but plug myself.
      View article »
    • ON: Mon Jul 7th 23:49 PM
      Commented on:
      Is Amazon.com Really Worth Over $70 a Share?
      What did you guys set your your SG&A, and COGS as a percentage of top line revenues? My assumptions back in Janurary were slightly different, and I came up with a $60/share valuation. My assumptions gave AMZN every benefit of the doubt, and put set them up under very optimistic scenarios. Almost half of their revenues come from outside the US. 6 months ago, I thought their overseas operations would be somewhat immune to the credit crisis unfolding here. It's a different story now.

      Although they see high margin channels through 3rd party sellers, AMZN has extremely tight margins for the overall business. With such tight margins and rising input costs, companies that operate on tight margins are going to feel it. I'm not sure what type of agreement Amazon has with UPS or USPS, but at some point Amazon is going to eat rising costs of shipping, or pass it on to the customer.

      Either option isn't great. Customers for the most part, associate AMZN with low cost or free shipping.

      There are too many other factors to outline here. I'm not sure what Citi (Mark Mahaney) and Goldman see that I don't with their bullish calls on Amazon.

      And please, let's not have another analyst try to compare the Kindle to the iPod.

      Two different customer segments, two different purposes.
      View article »
    • ON: Thu Jul 3rd 15:41 PM
      Commented on:
      Freeport McMoran: With Copper Prices Rising, It's Still a Buy
      There is a fundamental reason for the selloff. There is a nationwide strike going on in Peru, and FCX is caught up in this. This will obviously drive up copper prices, but companies like FCX and PCU will have to leave money on the table.

      www.mineweb.com/minewe...

      Check up Otto Rock's postings under PCU regarding his analysis on how long this strike could go. In fact, if you want good coverage on metals and south america, I would highly recommend his blog.

      www.incakolanews.blogs.../
      View article »
    • ON: Thu Jun 26th 19:40 PM
      Commented on:
      Should Analysts Who Don't Own Stock Be Trusted?
      Unless they are your best friend, or within your inner circle, it's hard to trust them whether they own the stock or not. If they own it, their style of communication maybe construed as "pumping". If they don't own it, you start to question whether they are "pumping" the stock because their clients have a majority stake in it

      At the end of the day, it's like trying to find a good car mechanic... Once you find one you trust, you go to them for all your work. Other times you try to go it your own way only to learn the hard way when your fist flies into the engine block at a 100mph because the lug nut has been torqued to death while you attempt to change the oil (yes, this happened to me).
      View article »
    • ON: Wed Jun 4th 18:01 PM
      Commented on:
      Is Amazon's Free Cash Flow Overstated?
      The change in net operating working capital is a factor in determining free cash flow available to the firm. William's argument about extending Current Liabilities out over several periods can affect FCF since it is a component in determining working capital. However, attention should also be paid to AMZN's LT debt obligations and the structured lines of credit agreements they have. I still think AMZN is overvalued, margins are thin, and there will be no improvement for some time to come.

      Another thing with respect to AMZN is to watch out for Citi's analyst Mark Mahaney... his research and calls on AMZN are a bit off the wall.
      View article »
    • ON: Wed Jun 4th 06:32 AM
      Commented on:
      Lululemon Reduces Guidance; Could Present Buying Opportunity
      I wish LULU good luck in proving/proving these lofty valuations going into 2008/2009. Christine Day's experience at Starbucks may not translate over well into women's apparel. I wasn't impressed much with the earnings call as Bob Meers and Christine Day both fielded questions back and forth. If you're going to pass the reigns over, hand it over to the new CEO.

      One of the analysts asked an interesting question regarding why the management/personnel changes now, and what LULU was missing prior. Part of the argument put forth by Christine Day, was the hire of Sheree Waterson who has prior e-commerce experience. She does, with enfashion.com during the dotcom days, but those online properties are now defunct. Starting up an online sales channel based on the company's growth strategy and free cash flow position will not be easy and eat into margins. Depreciation of IT systems was estimated at $1.2mm. Pay attention to CapEx and SGA in the coming quarters. Maybe they will outsource this operation... to "try" and keep growth costs down.

      time will tell.
      View article »
Loading...
Symbols:
Authors:
Quick Links:
Contribute an Article Become a Seeking Alpha Contributor

Transcripts

More Transcripts»