Below is a brief discussion of the three investment ideas I presented at the Cyprus Value Investor Conference. Office Depot (ODP) is a cost savings story where reductions have resulted in significant improvements in operating margins over the last few years. Sales growth though remains a headache and last quarter same-store sales were -6% (a 3-year low). Management … [Read more...]
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Summary Insiders have bought over $1 million worth of Target. Unlike the majority of the market, Target trades at a discount to its value. Stock price appears to have stabilized. Potential earnings beats or any improvement could see the stock much higher. First quarter results provided a hint that Target (NYSE:TGT) may not be doing as poorly as the wider market … [Read more...]
Summary What is the value of Apple stock? If the stock has exceeded its value then shouldn't even investors be selling? The article applies 6 different valuation methods to answer that question. If the stock is no longer cheap then what are the reasons for holding on to the stock? As a value investor and owner of Apple (NASDAQ:AAPL) stock, I am always concerned … [Read more...]
Summary The company has had a very long and strong history of growth, profitability and operating returns. Margins continue to be the major question mark; however, the peak rate of decline may be behind us. The stock appears to have overshot to the downside and trades at a significant discount to valuation. Online sales continue to expand at a 20%+ rate. The … [Read more...]
Summary Points: A private equity acquisition of both GNC and Vitamin Shoppe makes more sense than buying GNC alone. The deal will leave private equity with more upside and result in a premium that GNC/VSI investors will accept. The deterioration in GNC financials increases the difficult of getting the deal done. VSI is an alternative way to get exposure to any … [Read more...]
Summary Points: ANF pop was short-lived as new team still has a lot of work ahead of it. While Abercrombie brand continues to disappoint, Hollister is a bright spot. New CEO comes from Hollister so hopefully she can push the company in the right direction. Operating expenses need to be brought down further. Stock attractiveness stems from the dividend which … [Read more...]
Summary Points: Capital adequacy and NIM is decent however Citigroup's returns are behind its peers. Using regression we can calculate a multiple based on banks' returns. The calculations show that there is upside when compared to both North American and global banks. Investors interested in adding exposure to the sector should consider Citigroup. Valuing banks is … [Read more...]