Category Archives: position updates
This portfolio was built by me (no Obama).
(In size order)
Would you like to know what #6 and up is?
I bet you would.
I am not being melodramatic or overly emotional about the contents of this post. I am offering you a general diagnosis of my performance and how I am in great need of “adjustment” in order to correct the treacherous path I find myself on.
I will reserve full judgement on WNR’s earnings miss until after the conference call. However, I think it’s fair to say, I did not expect them to miss during an environment of unbridled gift horses. It’s as if they are spastic retards, wheel chairing their way through life, getting knocked into oncoming traffic by other retards with whiffle ball bats. To think that I have aligned myself with people who get escorted into oncoming traffic by way of whiffle ball bat is reprehensible and it makes me sick.
As I drove around in my garbage truck this morning, I concluded that my recent string of set backs had nothing to do with the lack of proper ritual, sacrificing the house pets of my neighbors in exchange for unlimited stock market powers. You see, it’s all a lie, one giant fib, so why put credence into said fib? In other words, this will be the last stock that I buy based upon a thesis. For me, it’s an end of an era. In essence, my “thesis penis” has been cut off.
Other refiners like TSO and HOC have normal management teams, who do not get involved with fucktards wielding whiffle ball bats for sport. The consequences of my actions have been matched with loss of pride, dignity and monetary reserves.
“The Fly” will need to kill a great many people before his thirst for anger and bloodshed is quenched. He will need to be smart about his next moves and rely upon his time machine aka The PPT more than ever.
As an aside, there are no redeeming qualities about this tape. I will look into increasing the size of my downside plays a great deal, especially long TZA, as this market looks tired, old and woefully gay.
In closing, if you followed me into battle and lost a few arms or legs, I am sorry for your loss. It’s important to remember “they are only arms and legs” and as long as you have a penis left, life is worth pursuing.
Little by little, the chairs are being removed from the floor. Soon enough, the music will end you will be left sitting on the floor, with tin cup, without coin. What you are witnessing today is classic end of the quarter bullshit, as money managers dress their respective windows with all of the finest shit. We haven’t seen this type of volatility in awhile. If you are long NFLX and made 30% this month (LOL!), you have to lock that shit in. At the same time, you have funds who are cash heavy dying to get in the game.
A few things that interest me, aside from perpetually higher equity prices:
FXY fishtails higher daily, much to the chagrin of the Bank of Japan and Japanese exporters.
TLT is rock steady, as retail money floods into bonds.
Banks have been weak all month long, despite the mega-charged, QE2, rally.
The market is controlled, once again, by the minute by minute fluctuations of the dollar.
Gold is the new reserve currency (rolls eyes)
No one seems to be concerned with weak European growth, following continent wide austerity programs.
Why do people think devaluing the dollar will lead to prosperity? Did it work for Japan? Furthermore, are we seeing inflation or purposeful currency devaluation on behalf of the Federal Reserve? Remember, Japan’s currency went down forever, amidst bone rattling deflation.
In short, ignore today’s volatility. It means nothing. Some of you think the market is going to new highs, based upon technicals and other stuff, ideas totally devoid of logic and reason. Others think the market will crash, due to the inexecutable, improbable and impractical U.S. policies that aim to print money, in order to solve deep rooted economic problems. The rest of you don’t know what the fuck is going on and have opted for the luxuries of cash. One thing is for certain: the animals in the zoo are running and in charge of the nuclear arsenal.
At the end of this quarter, my gains stand at about 27%. I am currently long large amounts of VXX, despite you motherfuckers panning it daily. I am short AEM. I am long large quantities of TLT and have been buying FXY. I have some longs left, but nothing meaningful.
For the love of homosexual dogs and criminal enterprises, I am positioned for a pullback.
My cost basis is around $2.30, so I am not exactly enthralled with the stock. Nonetheless, with funding out of the way for 2010 and natural gas prices on the mend, there is a chance little old Flotek Industries, Inc. [[FTK]] can get their act together and offer shareholders a reason to stay long, by way of normalization of earnings.
As you can see, the stock price is recovering nicely today, up more than 20%. If the company can get back on track, and that’s a big if, I believe Flotek Industries, Inc. [[FTK]] can be my biggest winner of 2010.
Either way, with today’s run in the stock, coupled with my other positions boot stomping higher, I am up more than 6% for the year.
Needless to say, I am just getting warmed up.
Here’s the bear case for Vulcan Materials Company [[VMC]] :
The company is a producer of asphalt, concrete and cement in a depressed U.S. construction environment.
Major inputs include diesel fuel and liquid asphalt. Both have soared in recent months.
In addition, the company levered up into a downturn and acquired Florida Rock (think Florida real estate), effectively making matters worse. Not only is Florida Rock a drag on them, from an operating standpoint, but they are laden with debt because of it. Currently, VMC has over $3.5 billion in debt.
VMC will get hit hard when municipalities cease their infrastructure projects, due to high material cost. The fact of the matter is, most municipalities are unprepared for the inflationary storm, about to hit their tax payers. Most, if not all, pegged their budgets to the erroneous cpi index, which does not reflect the mind numbing (double digit) increases in raw materials. In short, cities and states will be forced to delay or cancel numerous projects. That will be a huge blow to VMC.
via VMC‘s earnings report:
“Our earnings outlook reflects a prolonged downturn in residential construction, weakness in non-residential and highway construction activity and energy-related costs remaining at the current high levels. Leading indicators such as contract awards weakened in most construction categories in the second quarter. We now estimate full year aggregates shipments, including Florida Rock operations for the full year, to be down 2 to 5 percent versus the prior year.
“During this time of weaker demand, our focus is on those aspects of the business we can control. During the first half of this year, we have reduced operating hours, maintained relatively flat unit variable production costs excluding energy-related costs and decreased cash fixed costs. We will continue aggressively managing costs in all areas. We expect higher selling prices for our products to help offset the earnings effects of lower volumes and higher energy-related costs. For aggregates, we continue to expect full year price improvement of approximately 8 percent.
Their peers include Martin Marietta Materials, Inc. [[MLM]] , Texas Industries, Inc. [[TXI]] and Eagle Materials, Inc. [[EXP]] .
VMC is a repeat offender of missing earnings estimates, as demand and cost controls hit the company hard from every angle.
Their new guidance is for a profit range of $2.85-$3.25. However, I am very skeptical they can even hit that bottom number. I do not believe they are anticipating a drastic slowdown in municipal spending.
However, let’s say they hit $2.85. At current levels, that gives them a PE of 24. The average PE for their peers is 15x. However, that’s assuming they will hit their numbers too, which they will not.
At 15x 2009 earnings, VMC should be trading at $42. If their numbers come in short, due to a further economic slowdown, I believe the stock should trade 10x 2009 earnings or $28.
The only way VMC comes out smelling like roses is if residential real estate upticks, diesel fuel and liquid asphalt drop or the government implements an “infrastructure bailout,” allocating money to the construction of highways, bridges and tunnels.
In short, I believe none of that will occur and the stock is 36% overvalued, at current levels. With 20 million shares sold short or 18% of the float, expect large swings in the stock. Nonetheless, there is no fucking way this stock deserves to be up today, recovering from an early 6 point deficit.
Disclaimer: I am short egregious amounts of VMC.
NOTE: The conference call begins at 11 am, eastern.
Our resident hurricane watcher is hoping “Dolly will suck the pants off America,” via horrendous winds and “ball busting precipitation.”
Inside sources tell me “Dolly” will enter the Gulf of Mexico and punch the mustaches off of many oil rigs.
My personal weatherman says “Dolly is a dumb broad with fake nails and tits, ova here.” He said: “Fughetiboutit. Tell the steers and queers in Texas to wear a rain jacket and keep an umbrella handy.”
Should the storm take aim on the GOM rigs, get long crude and natty, via [[HP]], [[GLBL]], [[UPL]], [[UNG]], [[TXCO]] and [[NGAS]].
I just blew out of these positions for an egregious percentage gain.
“The Fly” wins again, even when most people think he is losing badly.
“The Fly” wins again, even when he appears to be losing badly.
CapitalSource prices its offering of 30.0 mln common shares at $11.00/share
On the matter of idiocy, [[CSE]] is trying to close on a deal to buy Fremont General in bankruptcy. Who is Fremont General, you ask? An egregious underwriter of mortgages in the God forsaken state of California. So, after the stock knifes lower by 30% in a week, the company dilutes its shareholders by 10%.
At the time of this post, “The Fly” was short CSE.
S&P DOWNGRADES OPINION ON
SHARES OF EAST WEST BANCORP
TO SELL FROM HOLD
Recent Price : $7.57
After widening our loss assumption for EWBC’s commercial loan portfolio, we are lowering our ’08 EPS estimate by $0.45 to $0.47 and ’09′s by $0.68 to $0.98, and we are cutting our 12-month target price by $9 to $6, which is about 6X our ’09 EPS estimate – below California peers.We believe EWBC’s commercial real estate and construction loans, which make up over 65% of the company’s loan portfolio and have above-average exposure to California’s Inland Empire, will see losses accelerate in coming quarters as housing market problems spread to other areas of the local economy.
I say, let them burn.
At the present, I am short [[EWBC]].