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Trade Talk Tuesday – USMCA (NAFTA), Not China

Image result for usmca cartoon"We might have another trade deal!

Yeah, that's right, I'm going to pretend to be excited about signing the US-Mexico-Canada trade deal and I'm going to pretend it's not just NAFTA with a different name and I'm going to pretend that deal wasn't supposedly all set 18 months ago and is only finally being ratified by Congress in a meaningless gesture that changes nothing.  Of course, it's not ACTUALLY being ratified but – PROGRESS IS BEING MADE – so the market is, of course higher.

Meanwhile, back in the real World, China's Ministry of Commerce says "external rumors" about the trade talks are not accurate and that the "so called" phase-one agreement may not be completed until next year as Beijing presses for greater reductions in tariffs and the Trump Administration pushes back with its own demands.  Trump has, so far, been sticking to his threat that tariffs will INCREASE on Dec 15th – it's very hard to imagine any deal getting done if that happens, as it would then look like China is breaking under Trump's tariff pressure and China would rather walk away than look weak.  

At least Alibaba (BABA) is having a good day, raising $11.2Bn in Hong Kong despite stores being shuttered and the streets smokey with tear gas.  BABA stock popped 6.5% this morning as they raised money on that exchange though that was already anticipated in a weeklong run on their Nasdaq proxy (BABA) – so don't expect the same over here as it came in right around their original HK target of $24, which they then lowered, so they could beat it.

Alibaba’s share sale was the largest offering of any kind in Hong Kong since 2010. The money raised by Alibaba will be added to the company’s cash pile, which is now $43 Billion – enough to buy M, JWN, KSS, BBY, BBBY, LB AND HBI – if they ever want to escape Hong Kong's Democracy and come to America…  

China’s banking sector grew riskier over the last year, with about 13% of the nation’s 4,379 banks and other financial firms considered “high risk” by the central bank.  Over in Japan, The IMF called on Japan’s government and central bank to cooperate more in support of the economy, Germany’s economy looks to be carrying slightly more momentum, writes Jamie Rush, suggesting the growth outlook is now a little brighter and Prime Minister Boris Johnson’s manifesto has left a question mark over the size of the fiscal boost, suggesting a rate cut being the Bank of England’s next move is more likely.  

So the World is still a very uncertain mess but, thankfully, we have a "very stable genius" overseeing our corner of it.  I resolve to be more bullish, hopefully, in the new year but, for now, I will enjoy my CASH!!! into the holidays.

 


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  1. Few stocks are driving this market:





  2. Ad business a boon for Amazon but a turn-off for shoppers


  3. Good Morning!


  4. DKS -Up 16% after raising outlook. 

    Perhaps not all retail is dead.  

    TGT & WMT are other examples of companies executing well.


  5. Albo – TGT is beast and up 100% over the last year. And clearly, they are executing well. Everything is so expensive now that maybe our valuation concepts are wrong. I found it hard to buy a retailer trading at over 20x earnings. Maybe it will be different this time. 


  6. STJ – I agree.  The only retail positions that I have on are DKS, M, and SIG OTM short puts.


  7. Can AI Compose Good Music?


  8. No one is worried – spot VIX below 12 now. Eveything is awesome.


  9. Updating my VIX-VXX chart to account for decay:


  10. Pretty safe to sell 40 calls now on a spike!


  11. Good morning!  

    DKS move is crazy.  That's what happens when people get slapped in the face by an undervalued stock (one we missed).  

    Dick's Sporting Goods Inc. stock soared nearly 13% in Tuesday premarket trading after the athletic retailer reported third-quarter earnings and sales that beat expectations. Net income totaled $57.6 million, or 66 cents per share, up from $37.8 million, or 39 cents per share, last year. Adjusted EPS of 52 cents beat the FactSet consensus for 38 cents. Sales of $1.96 billion were up from $1.86 billion last year and ahead of the FactSet guidance for $1.92 billion. E-commerce sales were up 13%. Same-store sales rose 6%, which the company says is the best showing since 2013. The FactSet outlook was for 2.9% growth. Dick's Sporting Goods now expects full-year EPS of $3.63 to $3.73 and adjusted EPS of $3.50 to $3.60. Same-store sales are expected to grow 2.5% to 3%. The FactSet estimate is for EPS of $3.40 and same-store sales growth of 2.2%.

    It's an 0.10 raise of guidance so not a big deal but $3.70 EPS on $40 price was just silly in the first place.  I'm very sorry I missed this one – so obvious…

    Big Chart – Very bullish pattern if not for the low volume.  Are we even going to crack 20M on Friday?  Maybe because it's the last trading day of the month…

    Date Open High Low Close* Adj Close** Volume
    Nov 26, 2019 313.41 313.86 313.07 313.58 313.58 5,622,715
    Nov 25, 2019 311.98 313.37 311.98 313.37 313.37 48,647,200
    Nov 22, 2019 311.09 311.24 309.85 310.96 310.96 44,850,200
    Nov 21, 2019 310.89 311.01 309.39 310.27 310.27 54,664,700
    Nov 20, 2019 311.28 311.85 309.06 310.77 310.77 79,406,200
    Nov 19, 2019 312.68 312.69 311.22 311.93 311.93 67,804,700

    DKS/Albo – AMZN is getting blowback from the way they've chosen to promotes sponsored content in favor of finding what you are actually looking for.  Also, they do nothing to police bad actors, who deceptively do things like sell you one can of coke for $1.99 when the description makes you think it's a case and the companies that sell things for $10 and charge $8 shipping – there's tons of that on AMZN and it pisses off their frequent users.  Also, AMZN has a huge problem with clothing and they've tried that nonsense where they send you 5 things to try and you send back 4 but that was a disaster – there are some things that are just better to buy in person.  Browsing is very hard on AMZN – there's too much stuff to just say "Men's shirt" also, stores are getting back to having a style, rather than trying to cater to everybody and that's a good thing as people like knowing a place "gets them".   Algos are still a bit clumsy at that.  

    Different/StJ – If you accept the premise that "safe" investments are capped at 3% and not 5% or 6%, then stocks become a more valuable alternative though I would argue that bonds are 3% because inflation is 2% (it is for rich people) and, therefore, there is still no reason to risk valuable cash in the uncertainty of a market that COULD lose your money.  

    It's very, VERY hard for me to justify paying more than 20x for stocks when there are PLENTY of stocks trading well below that like:  MT, TEVA, FCAU, DELL, VIA, AAL, VALE, F, SFBTY, ING, SAN, MFUG, LNC, PUK, BCS, MU, FCX, PRU, SNP, LEN, KHC, UBS, CBS, GS, COF, MET, MFC, LYG…  PLENTY of perfectly good mid to large-cap stocks trading at reasonable prices (some on the Watch List, some on deck and still being considered). 

    If there were NOTHING to buy cheaply, THEN I would consider paying 20x for a retailer or restaurant but ONLY if there are no alternatives – and there still are.  Enough to last the next 2-year cycle before I throw in the towel and pay these insane prices….

    On the smaller cap side, by the way, there's also:  X, M, CLF, MYL, ECA, ADS, TECK, BHF, STLD, SVC, XEC, NRZ, GPS, LB, NWL, HUN, GT, UTHR, AUO, TWO, AGNC, PK, MTG, BSM, SLM and HFC.  

    PLENTY to keep us busy.  

    X is back at $13.80 and you can buy the stock but it only pays an 0.20 dividend and they are not going to make any money so I'd set it up as a call-selling play like this:

    • Buy 40 X 2022 $10 calls for $6 ($24,000)
    • Sell 30 X 2022 $17 calls for $3.20 ($9,600) 
    • Sell 20 X 2022 $12 puts for $3.30 ($6,600) 
    • Sell 20 X March $14 calls for $1.60 ($3,200) 

    That's net $4,600 on the $28,000 spread that's $16,000 in the money at the moment and, of course, I'm assuming we'll be able to roll the 10 extra short calls out of trouble over time and, if not, worst case is we buy 10 more long calls ($6,000) to cover them so no real issue there, right?  I certainly don't think the puts are aggressive and we collected $3,200 selling 115 days out of 787 so at least 5 more sales to go to generate another $17,000 while we wait to make $23,400 on the spread – seems silly not to add that to our Butterfly Portfolio (which I am about to review).

    VIX/StJ – Worrying is so 2018…




  12. 2020′s Biggest Risks


  13. CMG making a big comeback.  Up another $20 today.  

    That's a short for the STP if it goes higher.

    I have the radio show at 2pm today so out of here at 1:30.  No Webinar tomorrow since not many people are around this week.


  14. CMG – Unreal.

    Chipotle Mexican Grill: Cowen upgrades CMG, calls stock a "Best Idea" for 2020.

    Cowen's Andrew Charles upgraded CMG to Outperform from Market Perform with a $970 price target,


  15. We lose DKS but DLTR (-15% because of the taxes) could be a good opportunity if the trade war with China gets any good news in the next months.


  16. Xerox going hostile in HP bid

    • Xerox (XRX -0.1%confirms it will take its takeover bid to HP's (HPQ -1.1%) shareholders.
    • The initial letter threatening to go hostile gave HP a November 25 deadline for agreeing to mutual confirmatory due diligence.
    • Key quote from the new letter: "We plan to engage directly with HP shareholders to solicit their support in urging the HP Board to do the right thing and pursue this compelling opportunity."
    • On Sunday, HP rejected Xerox's $22/share offer, saying the amount "significantly undervalues HP."

    Demand for jack-up rigs growing, Borr Drilling says

    • Borr Drilling (BORR -4.1%) drops after reporting a Q3 net loss of $79.2M and adjusted EBITDA of $13.8M.
    • The market for modern jack-up rigs has reached 90% utilization for the first time in the cycle, and the demand for jack-up rigs is growing, the company says.
    • Borr says there is visible demand for more than 50 jack-ups in the next 12 months, and only 14 warm stacked units remain in the market, but the company owns five of them.
    • Borr currently has 19 contracted rigs, with another 12 left to be contracted including seven yet to be delivered, which the company says places it "in a strong market position, both in terms of capacity and the age profile of our fleet."

    U.S. auto sales expected to drop in November

    • TrueCar forecasts new vehicle sales will fall 3.0% in November on an adjusted basis to 1,399,639 units. Retail deliveries are seen falling 2.6% during the month.
    • "Economic fundamentals remain solid with November auto sales continuing to follow a similar trend as previous months in 2019 with a slight year-over-year decline," notes TrueCar's Oliver Strauss.
    • Ford (F -0.4%) and General Motors (GM -0.3%) are expected to lose market share during the month with volume drops, while Hyundai/Kia (OTCPK:HYMLF), Honda (HMC -1.7%) and BMW (OTCPK:BMWYY) are forecast to post gains.

    Pockets of retail gain off strong earnings

    • The sporting goods sector is having a strong day after Dick's Sporting Goods (DKS +18.9%) came in with a strong earnings report and positive outlook on the holiday quarter.
    • Notable gainers include Foot Locker (FL +1.9%), Hibbett Sports (HIBB +4.2%), Sportsman's Warehouse Holdings (SPWH +2.6%) and Big 5 Sporting Goods (BGFV +1.1%).
    • There's also a lot of good cheer in the apparel store sector after Chico's FAS cruised past estimates. Stage Stores (SSI +3.1%), RTW Retailwinds (RTW +3.9%), Express (EXPR +4.4%), Citi Trends (CTRN +5.5%), Francesca's (FRAN +2.9%), Guess (GES +2.5%), Tilly's (TLYS +2.7%) and J. Jill (JILL +4.4%) are all showing gains.
    • Best Buy's strong guidance appears to be giving a bit of a lift to Target (TGT +1.7%), Costco (COST +0.2%) and GameStop (GME +1.4%).
    • The trade news is also leaning to the positive side today, which could be also helping sentiment with tariff impact in mind.

    ArcelorMittal to launch new sustainability program across Europe

    • ArcelorMittal (MT -0.1%) says it has launched a new sustainability program to secure a responsible steel site certification for its flat products plants across Europe.
    • MT says its 12-month program will enable each site to prove that its production processes meet rigorous standards across a range of social, environmental and governance criteria.
    • The standards are based on 12 principles aimed at improving steel production's impact on climate change and greenhouse gas emissions, water and biodiversity, human rights, labor rights and business activity.
    • MT says its sites in Belgium, Germany, Spain and France will be the first to be audited, with others to follow.

    Abu Dhabi planning up to $1.5B Aramco IPO stake – Bloomberg

    • Abu Dhabi is planning to contribute as much as $1.5B into Saudi Aramco's (ARMCO) IPO, as the Saudis call on friendly neighbors to prop up a deal that has failed to draw foreign investors, Bloomberg reports.
    • If Abu Dhabi puts in such a large order, it would mean the institutional offering is almost certainly fully covered; institutional subscriptions totaled 58.4B riyals ($15.6B), lead manager for the offering Samba Capital had said earlier, representing ~90% of the institutional tranche.
    • Crown Prince Mohammed bin Salman, who has made the Aramco share sale a centerpiece of his plan to modernize the Saudi economy, will make an official visit to Abu Dhabi tomorrow, according to Saudi TV.

    New home sales tally impresses

    • October New Home Sales: 733K vs. 707K expected.
    • September's mark was revised to +4.5% Y/Y from the -0.7% growth originally reported. The two-month new home sales tally is the best in more than 12 years.

    Richmond Fed Manufacturing softened in November

    Consumer confidence misses estimates

    Tariff concerns send discounters lower

    • Dollar General (DG -1.4%) and Five Below (FIVE -2%) open lower after Dollar Tree (DLTR -15.4%) drops guidance due largely to the anticipated negative impact of tariffs.
    • The retailer estimates that Section 301 tariffs will increase its cost of goods sold in Q4 by ~$19M or $0.06 per share if tariffs are fully implemented. A protracted trade war could make the damage even worse.
    • Previously: Dollar Tree EPS misses by $0.05, beats on revenue (Nov. 26)
    • Previously: Dollar Tree -7% after guidance limps in (Nov. 26)

    Home prices index rises 0.6% in September

    • Sep S&P Corelogic Case-Shiller HPI+0.6% M/M to 279.2 vs. +0.5% consensus, +0.2% prior.
    • +2.1% Y/Y (N.S.A) vs. +2.1% consensus, +2.0% prior.
    • HPI Composite – 20 (S.A.): +0.4% M/M vs. +0.3% consensus, +0.2% prior.

    Chain store sales stay in +4% trend

    • Chain store sales increased 4.3% for the week ending November 23 to pick up slightly from last week's pace of 4.1%. according to the latest report from Johnson Redbook.
    • Month-to-date sales for November are up 4.4% through November 23.

    Retail inventories up 0.3% in October

    Baltic Dry Index sails higher

    • The Baltic Dry Index rose 5.55% to 1,426 points in London to gain for third day in a row.
    • Capesize rates jumped 8.56% to lead the index higher. Supramax rates were up 2.21% and Handyside rates edged up 0.33%.
    • Related stocks: Diana Shipping (NYSE:DSX), DryShips (NASDAQ:DRYS), Eagle Bulk Shipping (NASDAQ:EGLE), Navios Maritime Holdings (NYSE:NM), Navios Maritime Partners (NYSE:NMM), Globus Maritime Limited (NASDAQ:GLBS), Safe Bulkers (NYSE:SB), Scorpio Bulkers (NYSE:SALT), Star Bulk Carriers (NASDAQ:SBLK), Golden Ocean Group Limited (NASDAQ:GOGL), Seanergy Maritime (NASDAQ:SHIP), EuroDry (NASDAQ:EDRY), Genco Shipping & Trading (NYSE:GNK).
    • Related ETFs: SEABDRY

  17. Reading in Finviz about CIDM the "director" bought $ 15B, what is this company doing?


  18. Disney+ getting 1M new subs per day

    • via NYPost
    • Research firm Apptopia figures Disney's (NYSE:DIS) new streaming service has been downloaded 15.5M times in less than two weeks since launch.
    • And that's not just folks taking advantage of a free trial – the data further shows $5M of in-app purchases.
    • The early numbers suggest Netflix (NASDAQ:NFLX) has a "legit competitor," says Wedbush's Dan Ives. "The pricing, the content and the bundling was just a pure genius strategy from Iger and Disney."
    • Disney is up 1.4% premarket.

    Plug Power in rally mode as B. Riley analyst lifts price target to $6

    • Plug Power (PLUG +10.4%) pushes to multi-year highs as B. Riley FBR reiterates its Buy rating and raises its price target to $6/share from $3.50, equaling ~6x EV/revenues.
    • B. Riley analyst Christopher Van Horn thinks the multiple is appropriate, given PLUG's implied 35% five-year compound annual growth rate from his 2019 revenue estimates, and nearly 90% four-year CAGR from his 2020 adjusted EBITDA estimate.
    • PLUG's long-term revenue target of $1B over the next five years, with $200M in adjusted EBITDA, "seems highly probable," given recent industry- and company-specific fundamentals, says Van Horn, who believes the stock and PLUG's fuel cell technology seem to be at an inflection point and that the company is better positioned in its core material handling business than ever before.
    • PLUG's average Sell Side Rating is Very Bullish, but both its Seeking Alpha Authors' Rating and Quant Rating are Neutral.

    Bed Bath & Beyond +8% on BAML confidence

    • Bed Bath & Beyond (NASDAQ:BBBY) rallies after positive comments from Bank of America Merrill Lynch analyst Curtis Nagle.
    • "We continue to see a substantial opportunity for higher earnings and share price performance for BBBY through: 1) divesting non-core and unprofitable assets; 2) cost reductions and store rationalization after years of highly inefficient spending; 3) the sale of real estate and secondary concepts; and 4) significant improvements to product merchandising, sourcing and in-store and online operations."
    • The firm keeps a Buy rating on BBBY and price objective of $20 (+50% upside potential).
    • Shares of Bed Bath & Beyond are up 8.26% to reverse last week's stumble.

    TiVo completes refinancing

    • TiVo (TIVO +5.8%entered into a new $715M Term Loan Credit Agreement with HPS Investment Partners as administrative and collateral agent, plus a $60M Revolving Loan Credit Agreement with Morgan Stanley Senior Funding and Wells Fargo Bank, National Association.
    • TiVo used the proceeds of the new term loan to repay loans under its existing term loan B facility and add cash to the balance sheet in anticipation of its Product business spin-off

    Fox sells out Super Bowl ad slots early

    • Fox (FOXFOXA) says it has sold out of its Super Bowl inventory with rates 6% higher than a year ago.
    • The network worked with the NFL to lower the overall number of ad breaks, which helped to raise the appeal of the "A" slots in the leadoff spots. Higher ratings this year for the NFL overall have also helped to support ad rates. Fox sold out of its ads much earlier than NBC and CBS over the last couple of Super Bowls.
    • Fox is now working on selling pre-game and post-game inventory for companies that weren't ready to pull the trigger early.

    Teva in talks with DoJ to end generics probes – Bloomberg

    • Teva Pharmaceuticals (TEVA +6.5%) pops higher in morning trade following a Bloomberg report that it has held talks with the U.S. Department of Justice about resolving a criminal antitrust probe of alleged price-fixing by the companies, Bloomberg reports.
    • A unit of Indian generics giant Sun Pharmaceutical also has been in talks with federal prosecutors, Bloomberg reports.
    • Among possible outcomes that have been discussed are deferred prosecution agreements in which the companies would admit to certain allegations but would be shielded from indictment in exchange for cooperating with the investigation and paying fines, according to the report.
    • Prosecutors have been probing allegations that generic drugmakers conspired to prop up the prices of certain widely used medications for more than five years and have hinted several times this year that charges could be imminent.

    Texas manufacturing activity weakens slightly

    • Dallas Fed Manufacturing Survey: -1.3 vs. -2.5 consensus and -5.1 prior.
    • Production: -2.4 vs. +4.5 prior.
    • Capacity utilization: -5.3 vs. +3.6 prior.
    • New Orders: -3.0 vs. -4.2 prior.

    Barclays cools on Molson Coors

    • Barclays says it's taking a wait-and-see approach with Molson Coors (TAP -0.2%) due to the recent track record of disappointments.
    • "We continue to appreciate the newfound urgency and creativity with which TAP has been working to improve top-line trends across its portfolio over the last 6 months and view the growth agenda within the newly announced 'revitalization plan' as a welcome extension of this. Still, there have been too many disappointments for too long and we worry that the company's approach of doing very little hand-holding with regard to near term guidance will mean improved revenue trends will need to be apparent before investors are willing to re-engage with the story."
    • The firm lowers TAP to an Equal-weight rating from Overweight. The average sell-side rating and Quant Rating on TAP are also at Neutral.

    CBS, Viacom hope to close merger next week

    • The pending merger between CBS (CBS -0.2%) and Viacom (VIA -0.8%) is currently expected to close after market hours on December 4.
    • The combined company will be renamed ViacomCBS and it is expected to begin trading the next day on the Nasdaq under new ticker symbols "VIACA" and "VIAC."

    AMC Entertainment rallies after big Frozen 2 weekend

    • AMC Entertainment (NYSE:AMCjumps 4.21% in morning trading after Frozen 2 opens with $127M in the U.S. and $350M globally to top expectations.
    • The Disney filmed earned a CinemaScore of A-, indicating it could have some legs for a while.
    • Previously: 'Frozen II' sets more Disney records (Nov. 25)

    New Netflix bear steps out

    • Wells Fargo sours on Netflix (NFLX -0.3%) in the face of new streaming competition.
    • "We think NFLX can achieve the street's sub growth expectations but those subs will be more expensive than investors realize," writes analyst Steven Cahall.
    • After a deep dive into Netflix's cash estimate, Cahall and team issue a free cash forecast about $18B below where the Street consensus stands.
    • "We don’t doubt NFLX will eventually turn a cash profit with arrows in the quiver like cracking down on password sharing, curtailing content spend or even advertising. But all of these indicate a more mature growth business likely with a lower multiple."
    • Wells Fargo lowers Netflix to an Underperform rating from Market Perform and assigns a price target of $265.

    McDonald's settles class action lawsuit

    • McDonald's (NYSE:MCD) agrees to pay $26M to settle a long dispute over labor violations and overtime wages.
    • The class action suit filed in California included about 38K McDonald's cooks and cashiers who alleged they were denied breaks and not paid properly for overtime hours.
    • The legal action was against company-owned stores. McDonald's has shifted a majority of its stores to the franchise model.
    • Shares of MCD are up 0.27% in premarket action.

    EBay +6% after selling StubHub

    • EBay (NASDAQ:EBAY) confirms it sold StubHub to viagogo for $4.05 billion in cash.
    • "We believe this transaction is a great outcome and maximizes long-term value for eBay shareholders," says interim CEO Scott Schenkel.
    • The sale was highly anticipated and followed a board review of eBay's strategies and portfolio.
    • The sale is expected to close by the end of Q1 of 2020, subject to regulatory approval and customary closing conditions.
    • EBAY +6.06% premarket to $37.25.
    • Source: Press Release

    Canopy Growth +4% premarket on new cannabis license for Smiths Falls facility

    • Canopy Growth (NYSE:CGC) has received its operating and secure storage licence from Health Canada for its 150,000 sq. ft. beverage facility located at Smiths Falls, ON.
    • Eleven beverages, all based on the company's unique Distilled Cannabis process, will be produced in the Smiths Falls facility.
    • Shares are up 4% premarket.

    Vail Resorts missing snow in early part of season

    • Bank of America Merrill Lynch says cumulative snowfall is down approximately 50% Y/Y for Vail Resorts (NYSE:MTN) properties, largely driven by weak snowfall at Whistler Blackcomb and Tahoe.
    • "Currently 12 of the 14 resorts we look at across MTN’s portfolio are tracking below last year’s snowfall totals through last Friday," updates the analyst team.
    • The firm reminds that pre-Thanksgiving/early season skiing typically has a low overall profit impact for Vail.
    • BAML has a Neutral rating on Vail and price objective of $245.

     

    CFNAI falls sharply in October

    Apple forecasts 100M+ 5G iPhone sales – report

    • Apple (NASDAQ:AAPL) tells supply chain partners to expect strong sales for the 5G iPhone coming next year, according to Digitimes sources.
    • The tech giant reportedly expects to sell over 100M 5G iPhones, up from the 70-80M sources say Apple forecasts for the iPhone 11 family this year.

    Animal spirits are alive and well

    • The IPO market may be a disaster, but fear not for the investment bankers – M&A action is approaching white-hot levels.
    • This Monday morning has Schwab (NYSE:SCHW) in a $26B deal for Ameritrade (NASDAQ:AMTD), LVMH (OTCPK:LVMHF) buying Tiffany (NYSE:TIF) for $16.2B, Novartis (NYSE:NVS) scooping up The Medicines Company (NASDAQ:MDCO) for $9.7B, and Kirkland Lake (NYSE:KL) taking out Detour Gold (OTCPK:DRGDF) for C$4.9B.
    • Potential future announcements include but are in no way limited to HP (NYSE:HPQ), which is currently playing hard-to-get with Xerox (NYSE:XRX), and the possible largest-ever LBO from KKR/Walgreens Boots Alliance (NASDAQ:WBA).
    • As Jimmy Conway said to Henry Hill … "It's gonna be a good summer."
    • Banks of interest: Goldman Sachs (NYSE:GS), Morgan Stanley (NYSE:MS), JPMorgan (NYSE:JPM), Bank of America (NYSE:BAC), Citigroup (NYSE:C)

  19. CIDM/Advill - They only have a $30M market cap so, even if you mean $15M – that's a lot!   It's a penny movie stock though – there are hundreds of them and most of them are scams so be careful.   

    Year End 31st Mar 2014 2015 2016 2017 2018 2019 TTM 2020E 2021E CAGR / Avg
    Revenue $m 104.3 105.5 104.4 90.4 67.7 53.5 46.8 44.1 119.8 -12.5%
    Operating Profit $m 6.39 -8.84 -22.1 8.23 0.72 -5.62 -8.07      
    Net Profit $m -25.9 -31.3 -41.7 -15.1 -18.5 -16.2 -17.6 -9.80 24.2  
    EPS Reported $ -2.51 -3.71 -6.51 -1.92 -0.50 -0.44 -0.46      
    EPS Normalised $ -1.36 -2.58 -4.72 -2.04 -0.50 -0.44 -0.46 -0.20 0.28  
    EPS Growth %                    
    PE Ratio x           n/a n/a n/a 2.65  
    PEG x           n/a n/a n/a n/a
    Profitability

    After 5 years of losses they project suddenly making $24M in 2021 and perhaps it's true and now the CEO is buying back the stock (after fleecing investors who put in $2 on previous promises) or maybe he's just pumping again ahead of the next dump by reducing the float ahead of yet another press release that something amazing is about to happen in CHINA!!!  

    he DOVE Channel turns back the clock this holiday season, as the faith-based digital-first Cinedigm (CIDM) network puts the spotlight on four retro classics from Hollywood’s Golden Age. As part of this special event, DOVE Channel is giving viewers a chance to enjoy premium programming for the whole family all year long with the “Deck The Halls With DOVE” offer—available for just $19.99.

    The roster premieres on Monday, November 25, and includes the color-restored 1935 Charles Dickens adaptation Scrooge (A Christmas Carol), starring Donald Calthrop as the quintessential miser who embarks on a legendary journey through Christmas past, present, and future; as well as the beloved 1961 animated favorite Rudolph The Red-Nosed Reindeer; a collection of side-splitting and heartwarming holiday sketches starring one of comedy’s most influential funnymen in Red Skelton Christmas Classics; the rarely seen 1966 fantasy Santa’s Christmas Circus Starring Whizzo The Clown, with Vaudeville star Frank Wiziarde as the titular clown who guides a group of children on a magic carpet ride to visit Santa

    Additionally, the Dove Channel linear network is offering a variety of curated holiday blocks airing throughout the season, including “Reason For the Season,” “12 Days to Christmas,” “Feliz Navi-Dogs,” “Dove Christmas Yule Log,” and “A Mayberry New Years Eve.” The live linear channel is available on Samsung, Stirr, and XUMO, as well as through the Direct-To-Consumer app on web, iOS, Android, Amazon Fire, & Roku. Dove Channel is also available on Dish, Sling TV and Vizio as a SVOD service.

    Wow, where can I sign up?!?

    I love the mission statement – sounds like it was written by a kid after his first Biz 101 class:

    Since inception, Cinedigm (CIDM) has been a leader at the forefront of the digital transformation of content distribution. Adapting to the rapidly transforming business needs of today’s entertainment landscape, Cinedigm remains a change-centric player focused on providing content, channels and services to the world’s largest media, technology and retail companies. Cinedigm’s Content and Networks groups provide original and aggregated programming, channels and services that entertain consumers globally across hundreds of millions of devices. For more information, visit http://www.cinedigm.com.

    Did you want fries with that?


  20. That´s why I ask you!  LOL… great analysis!

    But is interesting to see how huge amounts of money move in such strange ways, 15 billion in this…


  21. Actually, it's a really good scam when you think about it.  If you ever saw "Get Shorty", Gene Hackman is one of those Hollywood "Producers" who is always looking for projects and manages to squeak by from year to year his whole life.  They are always taking meetings with semi-famous actors (because semi-famous actors peddle projects too) and they are always looking for investors who want to be in the movie business and that scam is usually good for a few hundred thousand a year from a half dozen people who invest $50,000 in projects that die on the vine – but keep the producer in business (see also, "The Producers").   

    But this takes it to another level as the penny stock and the internet allow you to take money from a never-ending string of suckers and all you have to do is pay $5,000 for the rights to a script and get a big actor or two to say they'd be interested (if you can pay them their fees and if they are not conflicted) and then you are "green-lighted" and you issue a press release to pump up your stock (and goose it by buying a bit yourself) and then, when the project dies, you just buy it all back again for 1/3 the price and, next year, you push another project and sell 15M shares for a $1 profit again.  BRILLIANT! 

    Image result for brilliant guinness animated gif"



  22. Phil/TEVA,

    good to set up a BCS here assuming they are able to settle the charges?

    also on another note – would finviz elite be better than yahoo finance premium?

    regards


  23. Great movie, by the way:


  24. Finviz/Pat – I haven't tried it, or Yahoo Premium.  I'm happy with Stockopedia.   As to TEVA – I'm tempted but waiting to see what kind of settlement they have to come up with.


  25. Phil did suggest a TEVA trade on 11/15;

    You can sell 5 TEVA 2022 $7 puts for $2.60 ($1,300) and buy 20 of the 2022 $5 ($4)/12 ($1.85) bull call spreads at $2.15 ($4,300) for net $1,700 on the $14,000 spread so $12,300 (723%) of upside potential if TEVA can get back to $12 and you are starting out $4,000 in the money.  Worst case is you end up owning 1,000 shares of TEVA for $7,000 + the lost $1,700 so net $8.70 ($8,700) so it makes a pretty efficient play – even if it's for an IRA.

    That's the kind of play we build a portfolio with because, if it goes well, we make 12.3% of a $100,000 portfolio on the one trade and, realistically, we don't expect we're risking much more than $4,000 before we'd give up so it's well worth an allocation block (and we don't mind owning TEVA for the very long-term) and very little cash or margin commitment means we have more firepower to allocate to other trades.

    Nice call!


  26. Love the X play, the premium is decent and the stock moves around quite a bit, lots of opportunities to adjust. I was assigned stock on X puts almost a year ago and have faithfully worked my basis down to just under $10 by selling 45-60 day calls. Waited patiently til yesterday to sell another batch of $16Cs… 


  27. TEVA/Randers – Thanks, forgot about that one. 

    X/Ati – It's a fun stock to own.  Once in a while it pops sky high but then it's back the dumps.  

    It's great if you are patient enough to buy it low…

    Speaking of the dumps, no escape for TSLA:

    OK, I'm heading out for Radio – Butterfly tomorrow then.

    https://www.facebook.com/hempbocashow/

    They want me to start doing interviews (new studio today, more TV exposure) so if anyone wants their company promoted – let me know but you have to come to Boca Raton on a Tuesday afternoon. 




  28. No, the new CNN poll is not good news for Donald Trump on impeachment




  29. TEVA down.

    Federal Prosecutors Launch Criminal Probe of Opioid Makers, Distributors.


  30. TEVA / Albo – This is like trade talks – one day up on news of a settlement, one day down on news of more lawsuits! Sometimes, both news the same day! I really need to get rid of that dog!


  31. Phil.  DLTR  looks like a good time to pick up   Thoughts? 



  32. Added a little more NGL folloowing two large insider buys this month.

     

    NGL Director bought 50,000 shares at $10.02 – $10.15 worth ~ $500K.

    NGL CEO bought 100,000 shares at $9.82 – $9.95 worth ~ $1mln.

    Stock yielding 15.5% at current price.


  33. ngl 17.9% annual div yield? yikes.


  34. Don't forget that NGL comes with a K-1


  35. KL/Phil
    Hi Phil,
    After yesterday's announcement that Kirkland Lake Gold (KL) is
    acquiring Detour Gold (TSX:DGC), KL stock went from $47.62 to $39.44.
    I don't think there's any rush, but I would like your thoughts on
    what, if anything, I should do about my KL position.

    Buy  08/13/2019  20  KL  Yr 2021 Jan  $45  calls @ $11.00  -$22,000
    Sell 08/13/2019  20  KL  Yr 2021 Jan  $55  calls @ $ 7.00   $14,000

    Here's an article about the merger from Toronto, Nov. 25, 2019 (GLOBE
    NEWSWIRE). It looks like it's based on the press release.

    https://app.stockopedia.com/share-prices/kirkland-lake-gold-NYQ:KL/news/kirkland-lake-gold-to-add-new-cornerstone-asset-through-acquisition-of-detour-gold-grows-free-cash-flow-mineral-reserves-and-production-urn:newsml:reuters.com:20191125:nGNX2Lp3xT

    Thanks in advance.


  36. Arrg – I just lost all my comments because I clicked on that stupid link by accident! 

    TEVA/Albo, StJ – That's why I wanted to wait before adding them officially – still that overhang.  $48Bn was bandied about as a global settlement last month but the over 10 years was rejected.  Hard to say what TEVA's share would be.  

    DLTR/Batman – I think as long as there are tariffs, they can't make money and also I think that they did well in the last cycle because people were downsizing from TGT and WMT but now everyone has a job and wages are rising and their client base is shrinking – so not one I'd go for.

    NGL/Albo – He's only worth $6M so $1M in stock is a lot for the CEO but, then again, he gets a $3.5M salary from a company that makes no money so perhaps it was a necessary show of faith to keep his job?  They don't have enough in the bank to keep making those payouts but, if they do – he gets $150,000 back on his $1M anyway…

    KL/Saguaro – I'm sorry but they way overpaid for DGC, who produce just 900,000 ounces a year at a cost of $1,200 (GOLD sells mines that cost them more than $800).  KL thinks they can get it down to $900 and save $300 but that's only $270M and they paid $2.5Bn too much for DGC so you won't see a return on that acquisition until the 2030s and by then it will be 105 in the shade in December….  

    As to your position  I think you have 20 of the 2021 $45/55 bull call spreads at  net $8 and the 2021 $45s are now $5.50 with the stock at $39, so you can salvage those by cashing them in and pick up the 2022 $30 ($15)/45 ($8.40) bull call spreads for $6.60 so $1.10 more and you improve your long position drastically.  If they go lower, you can sell 10 of the 2022 $30 puts (now $5) for $5,000 or more and use that money to roll the 2022 $30s to the $20s and then revert to quarterly sales to generate cash.  That's if you want to stick with the position rather than just cashing out the net $2.40 ($4,800) and try to make your $11,200 loss back with this one:

    • Sell 20 GOLD 2022 $15 puts for $2.10 ($4,200) 
    • Buy 30 GOLD 2022 $13 calls for $5.50 ($16,500) 
    • Sell 30 GOLD 2022 $20 calls for $2.30 ($6,900) 
    • Sell 10 GOLD March $17 calls for $1.10 ($1,100)

    That set is net $4,300 on the $21,000 spread that's $12,000 in the money to start and you have 5 more $1,100 sales to go ($5,500) to get your net down to $0 if all goes well.  I'd feel a lot better about that than KL.