Amvona

graph imageOn January 5th, 2012 Amvona published the article American Greetings Corp. and the Triple “W”.  The thesis was comprised of two primary components:

 

a) The value and impact of the stock repurchases the company had made and would be making.
b) An appraisal of the real value of the company’s tangible assets.

 

The following is the price performance one year later of the two purchase made in the shares at the time.

Published in Finding Alpha

*May The Lord rest the souls of those who have departed in the destruction caused by Hurricane Sandy, and console their loved ones.

 

MBAsOn October 22nd, 2012 Western Digital Corp. released their Q1 2013 financial results.  Here are a few key points that are worth noting:

 

Valuation Ratios:  The cheapest Company in America?

 

"Citigroup‘s Joe Yoo today cut his ratings on hard drive and storage technology developers Seagate Technology (STX) and Western Digital (WDC) to Sell from Buy, writing that there is a chance of 25% downside to current estimates for the companies this quarter given what may be drastically lower volume of drive shipments.  Yoo cut his Seagate target to $25 from $37, and cut his Western Digital target to $32 from $53. …For Western, his estimates go to $15.3 billion and $9.99 in EPS from a prior $15.84 billion and $10.68 per share."

STX, WDC Cut to Sell at Citi; Estimates Too High Amidst PC Slowdown (Tech Trader Daily, Oct. 12th, 2012)

Published in Finding Alpha

Shares of Western Digital (WDC) were sold for investors accounts on August 13th, 2012 at $44.  As of close of market on Friday Oct. 19th, the shares were being traded for a mere 34.88.  A decline of a full $9.12 or almost 21% in barely 9 weeks.  Is the value of the company really less than it was, when the shares recently traded at $44?

 

wdc chart 10-22-2012

Published in Finding Alpha

intervention - royal tenenbaumsOn April 25th, 2012 Amvona published the article "Corning from another perspective”.  On May 2nd shares of Corning (GLW) were sold for investors accounts at $14.49 per share - a return of about ~13% in just over 4 months, or almost 38% annualized.  The shares were not sold because it was thought that they were overvalued, rather it was to free up capital for the growing position in Western Digital (WDC) later discussed in the follow up article "Update: Western Digital Discusses Q4 2012 Results”.

Published in Finding Alpha

On July 25th, 2012 Western Digital Corp. (WDC) announced their FY2012 results - and beat consensus EPS estimates of $2.47.  In after hours trading on July 24th as well as today, the shares moved up slightly, so it seemed like a good time to take a look back at some of the Amvona analysis of the company.

 

chart

Published in Finding Alpha

Spencer Platt/Getty ImagesOn May 17th around 2 p.m. a call came in from a friend, he said he had just received a call from his broker, who asked him “what he wanted to do about Facebook’s IPO”.    The response was intricate and subtle;

 

“wouldn't touch it with a hundred foot pole”

 

The advice was to consider buying Western Digital (WDC) instead if he had to buy something.    Sensing that the answer may have been a bit curt, the following email was sent shortly after the phone call:

Published in Finding Alpha

on the sidelines 2According to a research report published last Friday, Bank of America has downgraded Western Digital from Buy to Neutral, and lowered their target from $54 to $46. In the report, Bank of America said:

 

"WD reported significantly better than expected F3Q12 EPS at $2.52 vs. our/Street $1.60/1.55, driven by revenue and margin. WD guidance was disappointing (EPS of $2.35-2.55 vs. our/Street prior $2.67/2.30) and commentary pointed to softer demand than expected going forward, at current/elevated ASPs levels, and some pricing concessions (certain HGST customers, pre-acquisition). It appears the HDD industry can't have it both ways for much longer – pricing/margins at high levels, and expected strong demand, with assumed channel inventory refill. We step to the sidelines for now, despite attractive valuation."

Published in Finding Alpha
DSM_IV_2Probably because of some yet-to-be-diagnosed neurosis our idea of a “good time” is listening to replays of company conference calls - the company’s that we own for investor accounts are a lot of fun, but our real interest is their competitors.

Recently when listening to the Q3 2012 CC for Seagate Technologies (at about 9 min and 35 sec. into the call), we stumbled across an interesting piece of information - Seagate indicated that the TAM (Total Addressable Market) in the March QTR was about 143 M units, which was above both the industry analyst and the company’s own expectations of 130-135 M units, mentioned by the company in their January CC. 
Published in Finding Alpha
price_targetWe were waiting for at least a 7% price jump when we published our article Hard Drives, Floods, Monasteries and Investment Returns on Dec. 2nd , 2011 – good thing we weren’t holding our breath.  We thought the article looked pretty smart, not only because the WDC investment had already returned 30.2% to investors by the time we were able to publish, but also because we had this really crazy $67 dollar price target on the stock (way higher than any other analyst at the time) – we thought people would listen.
Published in Finding Alpha
Halki
 
The bones of an article
 
On November 16th, 2011 there just wasn’t enough time to do everything – something had to give.  We were packing our bags for our trip to Istanbul, we had to be at the airport by 6:30 p.m., we were making last minute preparations, scribbling out notes for an article on Western Digital and stuffing investors accounts with their shares as fast as we could.  After listening to their Q1 2012 CC call twice [and then STX’s] and having read all of their 10Q’sand annual reports for over a year we were more convinced now than ever that WDC had by far the superior management team, and with a confirmation of full insurance coverage including business continuity (that is to say lost income) after the floods in Thailand, there was no doubt left in what we were doing with investors money.
 
 
Although we only needed the typical hour to knock off the article, it just wasn’t in the cards.   By 2:30 p.m., amidst a flurry of phone calls and emails, we gave up on the idea that the article could be published that day, having scribbled out only the framework of an article.
 
Published in Finding Alpha
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