Stocks

[Adriano@10]

I have a friend who works in this industry and he told me about Bunge, did a bit of research and I liked everything that I was reading. It has a decent 5.8% div yield, solid balance sheet, and is in an industry where I do not have exposure and which seems to be a safe bet even in downturns (agriculture), I mean nothing is safe, but s&p is down 16% pre-corona and i got in at this at almost 40% down from pre-rona. Either I am losing my mind or there is something very wrong here, if rest of s&p is down only 16%, why tf is a company that is in Agriculture down 40%?

I understand the reasoning to some extent, its depression and all, but if this is down 40%, how low should brick and mortar coffee shops be? Or restaurants? Oreverything else minus tech and healthcare

update, china just posted fucking outlandish numbers in exports.


Trinh Nguyen
@Trinhnomics
China April exports rose +8.2%YoY in CNY vs estimate of a contraction!!!


Imports fell -14.2%YoY so that's bad news for the rest of Asia & world!!!

yeah man those exports seem to high unless theres a huge portion of masks and vents in there, but i doubt that since rest of the world only really needed them towards end of q1.

Still going over bunge s numbers but it looks good thus far not a industry i m too familiar with so it ll take me a bit longer. You already entered? Seeing them down almost 10% after earnings i m not sure i should listen in to the call.

Man valuations are beyond fucked unless the only inflation we find is in the stock market....

Also on tech i still think people are getting fooled look at lyft s presentation yesterday I mean yes their Q1 rev growth was great but we al know q2 is gonna be shit with rides down some 50% an their cash burn is still huge and profitability is no where in sight 15% up pre market wtf are people smoking?
On top of that cali just said it wont accept uber and lyfts hiring strategies any more and wants drivers to be employees from here on out.....

Therefore people might be finally waking up to the fraud that carvana is after another round of shitty results.
I really wonder whether we should just say fuck it and buy Hype stocks with very little value? Like W, Shopify, Bynd, Etsy, Tesla, Carvana...
Everything in me screams no but it looks like the market does not care that most of their business models seem unsustainable, i m not saying their all worthless but sure as hell their not worth the market cap they currently combine for 253.23 bio. i ll give em maybe half of that and thats still very generous.


Ferrari is also another weird case a company with very limited growth opportunities in it s main market(selling supercars) trading at 51 P/e..


Side note: https://www.ft.com/content/e2d7f424-8eb6-11ea-9e12-0d4655dbd44f

FT is killing it man their reporting has been so much better than any other news paper i m paying for WSJ has nothing on em it s almost scary how much better they are.

Edit just saw piper sandler downgraded:Lyft
while GS downgraded Shop I guess investors gonna ignore both but still good to see.

Also euronav CEO: over 100 tankers currently storing crude world wide.
Can the rest of the investment world realize that and pump up my euronav stock or do i have to wait till earnings?

Edit: Reading this: https://www.wsj.com/articles/the-glut-drowning-the-oil-market-11588843801?mod=hp_lead_pos5
and seeing oil prices back at 25 makes 0 sense... gonna be a hell of a ride from here on out till settlement.

edit: https://www.sec.gov/ix?doc=/Archives/edgar/data/914208/000091420820000297/ivzform8-k05062020.htm LOL invesco forgot to rebalance it s sp 500 fund

Us adds another 3.2 mio jobless claims this week meanwhile futures up 1.3%
Bulls: well thats half the unemployment claims we had in the worst week in march so we should be good....

 

[Adriano@10]

After listening to Bunges earnings call i like em sadly a bit late for todays party but it looks like a pretty safe thing, only worry is the exposure to Brazil and the real, plus a bit of a worry about energy prices.

Also management gave a lot more info on things then most other earnings calls i ve listened to these last 3 weeks. Plus implied funding cost is pretty low with their bonds expiring in 27 and a 3.5% coupon rate at a 2.5% discount ruffly so that s pretty good these times.
Gonna buy some but probably tomorrow since they are already up big.

Also gonna buy some General Dynamics 81% of revenue comes from defense contract and they have a huge order backlog. Their even less risky than Bunge but also offer lower upside but at 11x p/e and 3.6% div rate still good enough for me.

 

[Pimpin]

General dynamics looks interesting. Will add to watchlist. As of right now I am following a few american banks, Wells Fargo, JP Morgan and City, and I am baffled at how can there be such a wide difference in valuation between banks and the rest of sectors. I mean if shit hit the fan I do not see how the government doesn't cover sour loans.

I am also closely monitoring European banks, not that it's attractive for investing, but to follow the very real possibility of a big implosion. The rift between north/south is getting worse and worse by the day. German court ruled that ECB bond buying program is overstepping national rules or something along those lines. "Rebel" states may see this as an opportunity to revolt at ECB and wider EU institutions.

Another sector aside from financial that could be interesting is Energy and mining. Because of its cyclical nature, getting in low almost always means you get that ride up and sell it at a reasonable profit. (High demand=price up= high investment=oversupply= price down= low investment=prices recover). I mean again same as with financials, if Emerging Markets do not continue growing alot of companies in US suffer. Growth is almost equal to energy consumption, and no matter how much we may want, we are not getting 100% from sun anytime soon, probably not in our lifetime. Commodities like Copper, Cobalt, Lithium, Palladium, Iron, cement will be super necessary. Especially if Governments seeking economic growth invest on big infrastructure projects, like china in 2000-2010.

Uber did the same thing as lyft, 3bn losses in a quarter and the stock is up 6% pre-market, bonkers. I get looking to future, however, with this rate of cash burning, i think Uber will need to raise money AGAIN AND AGAIN. At this point to me it seems like its a glorified taxi company, with potentially very high utilisation rate.


Ft is pure treasure, I think that's the best investment someone looking to get into investment can make, start reading ft. Any term you don't understand google it and in 1-2 years you are a pro. It's amazing how much i've learned for the markets through that.

- - - Updated - - -

Also i took another look at halliburton, seeing how much they are exposed to US markets, they may tank either on WTI price collapse, or when some analyst puts the number of rigs operating (which i suspect is much lower than 50% from peak) meaning much less activity. Its precisely the exact stock to avoid when there is less oil rpoduction but long term should be good. But yeah rn seems a bit expensive if WTI has prolonged pause.

Unemployment rate at 15%. Absolutely insane. One thing that I read that was encouraging was how effective german furloughing schemes were during the financial crisis, ie. it kept the link between workers and work, so when the crisis passed, the firms already had qualified labor and labor had their jobs.. Could be replicated though in a much larger scale this time around. Let's hope it doesn't prolong past a few months..


Also In Ft there was this article about potential stagflation ie, disruptions in supply chains combined with pent up demand.. Somehow it makes a lot of sense. We have a lot of liquidity, dysfunctional market drunk on debt, and people willing to spend.

edit, I know it is not texas but read this

The precipitous drop in prices has compelled other big Bakken producers, such as Continental Resources and ConocoPhillips, to cut hard.

North Dakota’s Department of Mineral Resources said almost 7,000 of the state’s 16,000 wells have now shut. Analysts at RS Energy Group estimate production had already fallen by 500,000 b/d.

Shutting a producing well can cost $20,000, said Alexandre Ramos-Peon at Rystad Energy.

But bringing it back on stream costs up to $50,000, according to the DMR. So the eventual restart bill has already reached almost $350m.

 

[Adriano@10]

Yeah i m looking at us and swiss banks atm jp chase and Vontobel are my current front runners.
In the energy sector i m for sure looking whats gonna happen with june contracts first before i make a move and I m looking at natural gas currently on oil i m still 100% convinced that alll those us companies loose money with a oil price under 50$ if saudi does not make profits at such prices how should anybody else? So i guess i m still playing the waiting game there.
On Halliburton i had the same thought only thing that i m not sure are they involved in shutting dow drilling operations? Cause there is some money in that in the next 6 months maybe even their consulting rev goes up over the next couple of months but generally speaking it s not a too great outlook.

On uber and lyft while i love their product at this point i just think it s not a sustainable BM: On one side cause governments are not gonna take their employment strategy without a fight as we ve seen in the EU, on top of that i d expect many drivers to wake up at some point and realize that they are not even making min wage in many places if they calculate correctly. Basically i think their Tam and their margins on the long run are way overestimated.
Also i would love if both of them would focus on making ride sharing profitable instead of being all over the fucken place. WTF is uber in the Self driving race? All their doing there is fucken burn money left and right their not gonna win that race so whats the fucken point? Or those scooter rentals why do they still exist? There have been quite some companies to try that and they all went broke cause the BM does not work. Those scooters are to expensive to maintain and way to easy to break by any passer by. I just dont get how Investors dont tell both of them to fucking focus on making your core Business work.

But then again i guess thats what we get from FB Amazon and Google, Silicon valley is always gonna bring them up as examples of huge cash burn where it worked out and no matter how many times you explain em that BYND,LYFT,UBER,TESLA are nothing like this and dont scale as easy.
If they pay their workers fair wages and they pay taxes to the government than it s exactly what you said a glorified world wide TAXI company. The fact that you can order your cab through a app does not really impact margins that much.

But you can see how broken the valley is in elons compensation dude will get a 700 mio stock compensation for leading a company that has never made an annual profit in it s 12 years history and somehow very few people think there s something very wrong that

Yeah a couple of economists i ve listened to since this started warned of a stagflation early on. Only problem is that i still did not read up what the market consequences will be.

On that article that is exactly why i m thinking natural gas, some where down the line wether it s in 6 months 1 or 2 years the us oil production will not match the demand due to to many operations being shut down and it taking some time to get em back up running. Still in the early process though so if you got any better ideas or already have a company in that space do share please.


Also once again stocks rallied on horrible jobs numbers, then people tell me well it s cause of the china deal we had that china deal back on rally like 5 times in the last 5 months!!!!!

There s s till a couple of things that keep me cautious till Q2 one of em is that investors now do expect negative US rates and the fed till this day still says it wont go negative (atleast some members). Not sure whats gonna happen to prices in case the fed comes out with a strong statement that thats not gonna happen but chances are it would be a shitshow as every bulls best bull argument is dont bet against the fed.

One more thing is obviously the handling of the pandemic in the us and what i would call a good chance of another big outburst in the us, if there s another us lockdown even if only partial it s gonna be a shitshow.

Last but not least current outlandish Valuation of retail darlings: if any of em bites the dust we might see similar things as we saw in the 2000s.

Also united not getting any demand for it s debt priced at 11% is worrisome .


ALso guys i said it before i ll say it again check out DTH and Euro nav their very volatile and look expensive but value wise you get great fucken deals if you dig in. As long as oil prices are low these are cash machines only problem is that they are in an unatractive segemnt of the market so it takes time for people to notice but even if they dont notice you ll get fat dividends.
DHT increased it s quarterly div to 0.35$ per share while trading at 6.72$ do the math thats a 20% fwd dividend!!!!!

 

[Adriano@10]

More tesla news so after musk had another twitter breakdown threatening to leave Cali for texas if they dont let him open up 1 week before it was planned to open up anyways.
Finally some of his fans seem to realize what a piece of shit the guy is and are turning on him.

Also today china sales numbers for april are out teslas m3 sales are down 64% M/M despite the overall E car market in china growing 8% M/M.
So much for the claim demand is huge and tesla is production restricted.
Would not be surprised if the stock still goes up today as the usual enablers are at work again defending Elon/tesla.

Also i m at a point where i m absolutely disgusted with every finance professionals who still praise that fucken fraud or defends it. I hope that for once the likes of Ross Gerber, Cathie Wood, Cramer and Adam Jonas of MS will get what they deserve once the card house collapses. Cause there is no way that they miss all the red flag that are popping up for years now they know exactly what kind of BS their pushing on retail but they dont give a fuck.
It s funny how Chanos and Einhorn get a lot of shit for shorting the stock when they actually have better arguments then the Bulls and are way more respected in the finance world than any of the prominent bulls.
Yet somehow they are the idiots who dont understand new tech.......


On another not the saudis just fucked another of my trades over......
Fucken 10 mins after i decide to double down on my tanker bets they announce that they ll cut another 1mbd in june. Sent the stock down like 2%..
Not that i dont like that investment any more but it s just annoying as waiting 10 mins would have saved me money and increased my div yield even further.

Futures down over 1% atm

 

[Pimpin]

Tesla has been a cult for a while as we've been saying, and it'll keep being one. When someone gets 1 thing right, they get this sense of being infallible and get intellectually lazy, it is not something limited to Elon. The arguments for its valuation are so outlandish, the data, the self driving, but they would not understand any thing refuting their arguments. Hard to convince someone that does not understand something.

I told you about oil man, it is highly cyclical, and if you get in at a bottom, it will almost certainly go up if you hold it long enough, like all other commodities. The thing with oil is that so many countries depend on it, so you won't have them pumping oil to self destruct. The 20th will be interesting however, I still expect the contracts to drop considerably. I don't buy this 25% decline in demand, it seems far bigger percentage at least where I am living.

On the other hand, liquidity provided to Emerging Markets seems to have halted the doom I was predicting, at least short term. The markets were flooded with money from IMF and such organisations. I mean same thing happened to the stock market, so I am not surprised. Once you increase the money supply, the search for yield is back on and you got dog shit bonds at low rates. This can not be sustained. How can Emerging Markets in WB keep raising new debt at sub 1% yield? While the rally may continue and overcome Corona crisis, I fear what will ensue once we get over it.

reading the Saudi statement on cutbacks, I think they are the sole people on God's green earth who are taking the crisis seriously. I'd never thought id say this, but they seem to understand the depth of the crisis. Russia and some other countries have been oblivious. I mean Saudi Arabia was oblivious until now..

Now I am reading that alot of regions are reporting new cases.. Shocking.

upd

https://www.ft.com/content/7cfe4e67-4aa9-436c-827a-b59ebbf59c54

Really nice article.. scary quote

But the Secondary Market Corporate Credit Facility will buy exchange-traded junk bond funds. The Bank of Japan has been buying ETFs for a while, and the European Central Bank has hoovered up some high-quality corporate debt, but coming from the de facto global central bank, this amounts to a watershed moment in the history of monetary policy.

At the same time, a financial-crisis-era programme restarted in March was expanded to support top-rated slices of bundles of “leveraged loans” and commercial mortgages. Together, the three facilities come to $850bn — nearly half the size of the Fed’s entire first round of quantitative easing in 2008-10. The intervention has buoyed credit markets, helping a smattering of riskier companies raise financing even before a single dollar has been spent.

https://www.ft.com/content/f0f87b1a-7233-473c-9364-edade5345916

EM Corporate bonds.. Also some of the interviews there are hilarious when they say EM have been more disciplined and saying how EM corporations are less leveraged, as if that means shit once the central banks are in trouble and your balance shit is trillions of zimbabwean dollars and you owe 15 american dollars.

 

[brehme1989]

How much do you guys pay for FT? Used to have a subscription up until 2016 but then didn't feel the need to keep it. Had Bloomberg and/or Eikon so never really wanted to pay anything else for financial stuff as I am surrounded by a flow of information via apps, television, twitter and general media.

But I used to read a couple of articles a day, which I can still do to an extent, but if it doesn't cost more than 5-10 euros a month I may get it going again and enjoy the full experience. Saw once that they wanted 30£ a month which is absurd.

 

[Pimpin]

if you want to, I can send you up to 20 articles a week (or month?) as gift articles, just hit me up with what article you want and ill send it

 

[brehme1989]

if you want to, I can send you up to 20 articles a week (or month?) as gift articles, just hit me up with what article you want and ill send it

Thanks for the offer. I don't use it that much honestly. I have their app which has some decent content but it's not like I check on news sites and articles all day long. Wish I could do that though

 

[Adriano@10]

Tesla has been a cult for a while as we've been saying, and it'll keep being one. When someone gets 1 thing right, they get this sense of being infallible and get intellectually lazy, it is not something limited to Elon. The arguments for its valuation are so outlandish, the data, the self driving, but they would not understand any thing refuting their arguments. Hard to convince someone that does not understand something.

I told you about oil man, it is highly cyclical, and if you get in at a bottom, it will almost certainly go up if you hold it long enough, like all other commodities. The thing with oil is that so many countries depend on it, so you won't have them pumping oil to self destruct. The 20th will be interesting however, I still expect the contracts to drop considerably. I don't buy this 25% decline in demand, it seems far bigger percentage at least where I am living.

On the other hand, liquidity provided to Emerging Markets seems to have halted the doom I was predicting, at least short term. The markets were flooded with money from IMF and such organisations. I mean same thing happened to the stock market, so I am not surprised. Once you increase the money supply, the search for yield is back on and you got dog shit bonds at low rates. This can not be sustained. How can Emerging Markets in WB keep raising new debt at sub 1% yield? While the rally may continue and overcome Corona crisis, I fear what will ensue once we get over it.

reading the Saudi statement on cutbacks, I think they are the sole people on God's green earth who are taking the crisis seriously. I'd never thought id say this, but they seem to understand the depth of the crisis. Russia and some other countries have been oblivious. I mean Saudi Arabia was oblivious until now..

Now I am reading that alot of regions are reporting new cases.. Shocking.

upd

https://www.ft.com/content/7cfe4e67-4aa9-436c-827a-b59ebbf59c54

Really nice article.. scary quote



https://www.ft.com/content/f0f87b1a-7233-473c-9364-edade5345916

EM Corporate bonds.. Also some of the interviews there are hilarious when they say EM have been more disciplined and saying how EM corporations are less leveraged, as if that means shit once the central banks are in trouble and your balance shit is trillions of zimbabwean dollars and you owe 15 american dollars.

Fully agree, on the oil my rational is as long as air traffic is not up and running we re most likely gonna have a surplus in supply for some time hence why i doubled down on my tanker bet. I mean worst case scenario i collect 20% ad 30% dividends this year have to sell at a slight loss next year or just keep on collecting a 10% Div from there on out i currently dont see much better ways to play oil and i dont buy that we are in a equilibrium already.

Also this weeks seems different, not sure why but i think we might see another big drop to many are getting comfortable with this market. Just a feeling i got many bears turned last week based on no actual data.
Also fed chairs once again saying there will be no negative interest rates while markets are still betting on it......
But ofcourse as long as money is gonna flood the markets and the fed provides a backstop for debt and hence implied borrowing cost the search and stretch for yield will continue. My main problem with all of this is that the fed and a flood of money cant and wont keep earnings up. I personally simply dont or wont believe the earnings dont matter anymore. Investors might be able to ignore Q1 and Q2, but whats after that. Q3 probably wont be a disaster but it wont be great either thats for sure. So the real question is when will stocks care about earnings again? I have no answer to that question but when the time comes we re in for a big correction.


On another note Airbnb saying theri data point shows to a v recovery in booking when they are still down 85% yoy, it s hilarious....
Same came from autonation dealers that are down 90% yoy.

ALso the nasdaq is just cray even people like chamaht palihapityia(sp) say so and he s aberma bull in my books

On a side note Tesla defied lockdown orders of Alameda county yesterday and opened their factory, sadly police is thus far sitting by and watching.
But once again Elon shows that he s utterly unfit to be CEO he just pissed of the state where most of his customers sit and that made tesla possible in the first place with all it s subsidies.
Also i m sorry if people don t care but to me this story is fascinating and i m already looking forward to the shocking netflix doc that will be made....

Never thought i would see something like this play out on social media...



Breheme the FT online subscription only is like 500 chf a year for me think the paper version would have cost 1k more.

 

[Pimpin]

american banks are getting BATTERED. If things are as bad as the financial sector investors think, why the f are all other sectors up?

 

[Adriano@10]

american banks are getting BATTERED. If things are as bad as the financial sector investors think, why the f are all other sectors up?

IDIOTS going never fight the feds.....
Another set of idiots not understanding that tech is also affected by a recession and that we are close to the dot.com bubble valuation for some tech stocks.
Then theres a set of smart assholes who feed the buying frency like Cathy wood, jim Cramer, everybody at softbank and so on they know that they are selling crap they just dont care.

Also all those fucking trading algos cannot help..

Again every sensible investor/economist even if they are into tech cannot explain what is happening currently.

Gonna sit out this week with new investments, i ve got around 30% back in the market last week.

 

[Adriano@10]

Anybody know what the fully booked for CCL s august cruises mean? Like are they sailing at full capacity?
Asking cause they said Disney shanghai is sold out at the opening but they did not mention at first that sold out in this case means at 25% of the pre covid full capacity.

So i was wondering if the same applies for cruises but cannot find any clarification.
But i cannot imagine that they fucking sail at full capacity in august.
On the other hand price per night was something around 20 to 25 usd so sailing at 25% capacity with these prices would probably not make any economic sense.
Then again maybe the Saudis just want oil demand to pick up.


EDIT: another curios thing with RCL they re gonna raise 3.3 bio trough a bond offering that is backed by 28 of their ships as a collateral. Now the weird thing is that RCL says 2.35 bio of that money will be used to repay MS for theor one year secured loan agreement which also was backed by the ships as a collateral...

Seems a bit weird to me.

Did some more digging looks like the 2.35 bio they got in march are not enough to keep em afloat as the deal they got from MS was at an interest of libor plus 2.25 which would increase up to 2.75.

So they ll go from paying +/-3% to paying 10% plus on their debt. Seems like a great business.


Also on oil Oecd numbers are out oil stocks in march 89 mb above 5 year average. Oil stock increased 57.7 mio barell in march.

Also Saudi Kuwait and Emiratis increased their output by 3MBD in APRIL...

Does not sound like will come into an equilibrium soon.

Edit2: Almost forgot wirecard preliminary q1 should be released tomorrow, remember they have yet to release q419 with EY not having signed of on the 2019 audit.
Not sure which situation is crayzier Tesla or Wirecard but both situations i d never thought i d witness.

 

[brehme1989]

So do we expect American Airlines to go bust by the end of the month or do you think it's someone else (first) or it's still early and it may take more months?

 

[Candreva Crosses]

if you want to, I can send you up to 20 articles a week (or month?) as gift articles, just hit me up with what article you want and ill send it

This is nice but its against your username mate. You'll need money.

 

[Adriano@10]

So do we expect American Airlines to go bust by the end of the month or do you think it's someone else (first) or it's still early and it may take more months?

By the end of the months? No, by the end of the year? Depends on gov aid.

 

[Pimpin]

https://twitter.com/JKempEnergy/status/1260848201910890496

strap in bois

 

[Adriano@10]

https://twitter.com/JKempEnergy/status/1260848201910890496

strap in bois

HAHAH we re in for another cray week also WTI is currently 5% up.......


Edit: From wsj: In its monthly oil-market report, the IEA projected global demand to drop by 21.5 million barrels a day this month, while crude-producing nations and companies slash output by 12 million barrels a day.

So we re still at overproduction and by quite a lot. i d guess some traders with no storage space are gonna get burned soon.

Also gonna buy long dated carvana puts, cant see how this shitstain of a company can survive whats gonna happen to the used car markets.

 

[brehme1989]

It shouldn't be surprising if oil collapses again.

 

[Adriano@10]

It shouldn't be surprising if oil collapses again.

The surprising part to me was how high it got again, everybody involved in oil said it would collapse again.

Then again daytraders....

Edit: another 3 mio claims today.....