Latest Expert Opinions

Signal
Opinion
Expert
DON'T BUY
DON'T BUY
August 2, 2016

Feels it is too late to be buying. The track record of the management team has been very shareholder oriented, and returns they have delivered have been nothing short of extraordinary. It is all a question of what you are willing to pay for those attributes. He would argue that the market is overpaying from what he sees for the next 1-3 years. The business is now $30 billion+ dollar market cap. He started buying it at a $2 billion market cap. Fuel margins are a big driver of their profits and they are getting $.18-$.19 a gallon, and a lot of that has to do with declining oil prices. Sold his holdings, and would like to buy it back, but at 18X.

Show full opinionHide full opinion

Feels it is too late to be buying. The track record of the management team has been very shareholder oriented, and returns they have delivered have been nothing short of extraordinary. It is all a question of what you are willing to pay for those attributes. He would argue that the market is overpaying from what he sees for the next 1-3 years. The business is now $30 billion+ dollar market cap. He started buying it at a $2 billion market cap. Fuel margins are a big driver of their profits and they are getting $.18-$.19 a gallon, and a lot of that has to do with declining oil prices. Sold his holdings, and would like to buy it back, but at 18X.

COMMENT
COMMENT
August 2, 2016

Their value proposition to customers is not something he is particularly comfortable with. They provide you certainty on your cost of living, etc., but in exchange for a big certainty premium. He has not been able to figure out how that is a repeatable strategy over time. Also, it is a captive universe. Once you have knocked on every door, there is a lot of time before you can go back. Because of this, it is not a growth stock.

Show full opinionHide full opinion

Their value proposition to customers is not something he is particularly comfortable with. They provide you certainty on your cost of living, etc., but in exchange for a big certainty premium. He has not been able to figure out how that is a repeatable strategy over time. Also, it is a captive universe. Once you have knocked on every door, there is a lot of time before you can go back. Because of this, it is not a growth stock.

COMMENT
COMMENT
August 2, 2016

The commodity downturn we saw happen 1.5 years ago, had a big impact on volumes, not just oil, but a number of things that were shipped by rail. This, and Canadian Pacific (CP-T) have become phenomenal businesses over the last 15 years in terms of returns. Rails are businesses he wants to own at the right price, and the right price on this was a couple of months ago, so he has not been adding to it since. This represents good value today. Prefers Canadian Pacific even though it is more expensive.

Show full opinionHide full opinion

The commodity downturn we saw happen 1.5 years ago, had a big impact on volumes, not just oil, but a number of things that were shipped by rail. This, and Canadian Pacific (CP-T) have become phenomenal businesses over the last 15 years in terms of returns. Rails are businesses he wants to own at the right price, and the right price on this was a couple of months ago, so he has not been adding to it since. This represents good value today. Prefers Canadian Pacific even though it is more expensive.

TOP PICK
TOP PICK
August 2, 2016

This is an IT services company. Valuation is almost a 10% free cash flow yield. In May they announced they were acquiring HP Enterprises. Thinks people are underestimating the accretion and the synergies delivered from this merger. It is a very fragmented industry. They will be a multibillion-dollar company poised to continue making accretive acquisitions. Dividend yield of 1.18%.

Show full opinionHide full opinion

This is an IT services company. Valuation is almost a 10% free cash flow yield. In May they announced they were acquiring HP Enterprises. Thinks people are underestimating the accretion and the synergies delivered from this merger. It is a very fragmented industry. They will be a multibillion-dollar company poised to continue making accretive acquisitions. Dividend yield of 1.18%.

TOP PICK
TOP PICK
August 2, 2016

Over the last 30 years, they have compounded shareholders’ wealth at 10%. They are changing the front of the store, moving up the ranks. Today you are paying 15X and thinks you’re getting Rite Aid for free.

Show full opinionHide full opinion

Over the last 30 years, they have compounded shareholders’ wealth at 10%. They are changing the front of the store, moving up the ranks. Today you are paying 15X and thinks you’re getting Rite Aid for free.

TOP PICK
TOP PICK
August 2, 2016

They are extremely targeted and very focused on small/medium Enterprises, and the owner/entrepreneurs that run those businesses. A very conservative and well-run bank. They are carving out the top teens from all the top-performing bulge bracket banks. They come to Signature and get a P&L, so if they make a good loan, they participate in profits. If they make a bad loan, they have to wear the loss. BV multiple is about 1.8.

Show full opinionHide full opinion
Signature Bank (SBNY-Q)
August 2, 2016

They are extremely targeted and very focused on small/medium Enterprises, and the owner/entrepreneurs that run those businesses. A very conservative and well-run bank. They are carving out the top teens from all the top-performing bulge bracket banks. They come to Signature and get a P&L, so if they make a good loan, they participate in profits. If they make a bad loan, they have to wear the loss. BV multiple is about 1.8.