Tuesday, October 16, 2007


Sector Spotlight: Oil

What the fuck is going on?

What, all of a sudden oil, Turkey and bullshit numbers from a second rate company (ERIC) is going to get in our way? Magically, Rick Santelli's bearish wet dream will come to fruition and the SRS will print $120 again?

Fuck that, we're going higher, eventually.

Despite the negative tone in early trading, I see signs of strength in MSFT, NVDA, AAPL and a bunch of charging energy stocks.

While it's true, I anticipate timid trading until after Halloween; it still makes sense to start nibbling at unfair declines.

Now, if you missed out on the phenomenal run in Chinese related names, this can be a good opportunity to roll some dice, as many Chicom stocks are being marked down.

Already, JRJC went from negative to +$3 today.

As you know, my favorite way to play China is through advertising companies, like FMCN and XFML. However, it's worth mentioning, XFML trades like a fucking turd.

Finally, there is vast weakness in credit related names, especially the homies and brokers. Once again, I'd avoid all financials and homebuilders stocks. Instead, when looking for places to put money, I'd look at some of the infrastructure and oil service related names, like VMI, UPL or FTK.

The MONstah is becoming attractive to me again. Just got the GS and MS reports on them. Contra-investing wise, the praise they heap is almost an off putter.

But I know how good this company is.

From GS:

MON reported the completion of an extremely successful FY2007 where
EPS jumped an impressive 54% as MON gained market share, increased
trait penetration and leveraged the 19% pop in US corn acreage. The
outlook for MON remains very bright for both FY2008 and through the rest
of the decade. While ongoing 50% annual EPS gains are unreasonable to
expect, we do believe 20%-25% gains are possible as the company extends
trait penetration, continues driving market share, layers on a new element
of price, commercializes second-generation products and starts to extract
benefits from its recent acquisitions (DeltaPine, Seminis, Agroeste). While
the market initially focused on the below consensus FY2008 EPS guidance
of $2.20-$2.40 that implies a 10%-20% growth expectation, the stock rallied
through the day as investors recognize not only that this guidance likely
repeats a pattern of underpromising, but also that the pipeline and future
opportunities at MON remains compelling.

BA Barakas...

Do you get GS reports? I can forward this one to you if you like.
^I think BA is more of a "Shredder" type of guy. Either that or a "Johnny Cage"-match.

JG--Mortal Combat? Nevermind, I had a childhood flashback.
Oh, I'm sorry, cultural overlap. "Barakas" in my meaning is the badass from "The A-Team" as played by "Mr. T."

(Apparently I was misspelling it, it's "Baracas")
Don't know if any of you were watching the World Cup, but stuff like this shows just how far American rugby has to go before it can compete on the world stage.
Is MRVL cheap at $17?

One would think so. However, management blows.

It doesnt concern you that 2 analyst are way high on XFML EPS? wont theheadline be" XFML misses estimates?...

Give those analyst shmucks a call will you?
Very keen of you to see that.

This is being addressed.

If they are not brought in line, JP Morgan and UBS are purposefully keeping them high, in order to force a miss.

Shady stuff.
If it's true that stocks that print $80 ultimately go to $120, does the same "logic" apply to oil?
I have people that will bitch-slap the UBS analyst to get the XFML numbers in line with company guidance.

...nothing beats investing mafia-style.
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