måndag 30 maj 2016

På börsfronten intet nytt. Alfa Laval, Snapchat, TGS.

Händer inte så mycket på börsen och det blir intressant att se vad som sker framåt. Planen är att jag ska göra en större genomgång av de nordiska börserna, kanske hittar jag något mer att investera i eller så hittar jag absolut ingenting.

Alfa Laval

http://jordholmen.blogspot.se/2015/07/ar-alfa-laval-ett-tillvaxtbolag.html

Det senaste inlägget jag skrev om Alfa Laval var "ganska" sågande med kommentarer som:

"Bolag som gör odisciplinerade gigantiska förvärv och vandaliserar sin balansräkning kan inte anses vara tillväxtbolag, utan bör snarare anses vara ett bolag som gör ett stort förvärv......"

Fast Alfa Laval är ju förstås annorlunda. Alfa Laval betala ju endast 13,4 miljarder nok för Frank Mohn med en omsättning på drygt 3,4 miljarder norska kronor. Inte nog med det, Alfa Laval köpte Frank Mohn från familjen Mohn som förmodligen inte har någon som helst aning om vad deras eget företag är värt. 

(...)Nedan kan man se Alfa Lavals förvärvshistorik sedan 2010 och Alfa Laval verkar ha gjort många små disciplinerade förvärv inom nischföretag. 2011 genomfördes ett större förvärv av företaget Aalborg och 2010 hade Aalborg en omsättning på 3,3 miljarder sek. Alfa Laval betala drygt 5 miljarder sek (dåvarande dollarkurs) för Aalborg. När man jämför förvärvet av Aalborg med förvärvet av Frank Mohn frågar man sig vad VDn sysslar med.

(...)Man kan fråga sig varför VDn helt plötsligt började löpa amok 2014 och göra uppenbart värdeförstörande förvärv? Började VDn bli desperat av den allt mer stagnerande tillväxten och bestämde sig för att slå på stort? Kanske försökte VDn maximera sin ersättning och trycka upp EPS något?"

Och nu finns det förstås bevis för att Alfa Lavals senaste förvärv var ett misslyckande. Alfa Lavals VD kan förstås inte hjälpa att oljepriset kollapsa direkt efter förvärvet, men i min mening skulle förvärvet i vilket fall blivit ett misslyckande. Alfa Lavals orderingång har sjunkit kraftigt och omsättningen lär följa orderingången nedåt så småningom. Det stora förvärvet av Frank Mohn ingår numera i Alfa Lavals Marine and diesel division.

Omsättningen utvecklas dåligt för Alfa Laval som helhet.

Orderingången utvecklas än värre för Alfa Laval som helhet.

Frank Mohn ingår i divisionen Marine och Diesel och denna divisionen utvecklas mycket dåligt.

Alfa Laval har fått en dålig start. Kanske är den dåliga starten bara en tillfällighet och kanske kommer de svagare kvartalen ersättas av starka framåt?

Snapchat och TGS

Snapchat kan snart värderas till 167 miljarder SEK samtidigt som bolaget omsätter ringa 100 miljoner dollar. Hur lång tid tar det innan denna bubbla imploderar? Vem vet, med tanke på hur länge Tesla varit groteskt övervärderat framstår det som att vinster och dylikt är obetydliga faktorer för "populära bolag".

TGS group rapporterade nyligen resultatet för det första kvartalet. TGS har fallit en del sedan jag först börja kolla på det, men givet TGS resultatutveckling borde aktien fallit än mer.


Det framstår som att många placerare tycks övertygade om en snabb återhämtning i oljepriset (80-90 dollar). Jag anser att TGSs kurs prisar in en sådan hastig återhämtning och såvida inte det finns starkare skäl för att tro att en sådan återhämtning är på väg vill jag ej köpa. Som det ser ut nu fortsätter jag att med intresse betrakta bolaget.

söndag 15 maj 2016

En av vår tids främsta placerare är extremt negativ, Stanley Druckenmiller presentation

(Stanley Druckenmillers presentation finnes i sin helhet här och här. Uppenbarligen är Valuewalk oförmögna till att lägga slidsen och transkriptet på en och samma sida. I detta inlägget har jag därför genomfört denna oerhört svåra uppgift, även om jag insåg när jag var klar att ZH redan gjort detta. Därför kan man lika bra läsa Druckenmillers presentationen på ZH, speciellt om man föredrar apokalyptiska undertoner.)

Inlägget inleds med en kort beskrivning av Druckenmiller och slutligen följer Druckenmillers presentation.

Stanley Druckenmiller är i min mening en av giganterna i investeringsvärlden tillsammans med legender som Klarman, Soros, Buffett, Graham och Icahn. Stanley Druckenmillers lyckades prestera 30% årligen i 22 år under sin tid som förvaltare.

"According to Bloomberg News, on August 18, 2010, Druckenmiller announced the closing of his hedge fund "telling investors he'd been worn down by the stress of trying to maintain one of the best trading records in the industry while managing an 'enormous amount of capital.'"[6] Duquesne Capital Management posts an average annual return of 30 percent without any money-losing year." (https://en.wikipedia.org/wiki/Stanley_Druckenmiller)

Druckenmiller arbetade under en längre period för Soros och tillsammans forcerade de den brittiska centralbanken att låta pundet flyta 1992. Soros fond ska ha gjort en vinst om 1 miljard pund, men det var Druckenmiller som inledde positionen. När Druckenmiller först berättade om sin enorma blankningsposition, så reagerade Soros väldigt intressant:

"In his discussion of his experiences with the legendary Soros, Druck related the story of how he identified the British pound as a near-lock short back in 1992 and told Soros he was making a huge bet ($5.5 billion) on it. Soros told him “Don’t be a fool, you should put at least 200% our net worth ($15 billion) on this once in 20-year opportunity.” (http://www.valuewalk.com/2015/04/stan-druckenmiller-lost-tree-club/)

Om man läst denna bloggen kommer man känna igen de orostecken Druckenmiller behandlar i nedanstående presentation och man kan till och med känna igen några av graferna i presentationen. För de som misstänker att jag käkar hallucinogena svampar innan jag skriver mina inlägg, blir frågeställningen:

Har även Druckenmiller börjat käka hallucinogena svampar?

Nedan följer Druckenmillers presentation

myopic - shortsighted

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When I started Duquesne in February of 1981, the risk free rate of return, 5 year treasuries, was 15%. Real rates were close to 5%. We were setting up for one of the greatest bull markets in financial history as assets were priced incredibly cheaply to compete with risk free rates and Volcker’s brutal monetary squeeze forced much needed restructuring at the macro and micro level. It is not a coincidence that strange bedfellows Tip O’Neill and Ronald Reagan produced the last major reforms in social security and taxes shortly thereafter. Moreover, the 15% hurdle rate forced corporations to invest their capital wisely and engage in their own structural reform. If this led to one of the greatest investment environments ever, how can the mirror of it, which is where we are today, also be a great investment environment? Not a week goes by without someone extolling the virtues of the equity market because “there is no alternative” with rates at zero. The view has become so widely held it has its own acronym, “TINA”.

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{Switch to slide 3} Not only valuations were low back in 1981 but financial leverage was less than half of what it is today. The capacity of credit inspired growth was still ahead of us. The policy response to the global crisis was, and more importantly, remains so forceful that it has prevented any real deleveraging from happening. Leverage has actually increased globally. Ironically from where I stand, that has been the intended goal of most policymakers today.

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{Slide 4} Let me focus on two of the main policies that have not only prevented a clean-up of past excesses in developed markets but also led to an explosion in leverage in Emerging markets. The first of these policies has been spearheaded by the Federal Reserve Bank in the US. By most objective measures, we are deep into the longest period ever of excessively easy monetary policies. During the great recession, rates were set at zero and they expanded their balance sheet by $1.4T. More to the point, after the great recession ended, the Fed continued to expand their balance sheet another $2.2T. Today, with unemployment below 5% and inflation close to 2%, the Fed’s radical dovishness continues. If the Fed was using an average of Volcker and Greenspan’s response to data as implied by standard Taylor rules, Fed Funds would be close to 3% today. In other words, and quite ironically, this is the least “data dependent” Fed we have had in history. Simply put, this is the biggest and longest dovish deviation from historical norms I have seen in my career. The Fed has borrowed more from future consumption than ever before. And despite the US global outperformance, we currently have the most negative real rates in the G-7. At the 2005 Ira Sohn Conference, looking at a more muted but similar deviation, I argued that the Greenspan Fed was sowing the seeds of an historical housing bubble fed by reckless sub-prime borrowing that would end very badly. Those policy excesses pale in comparison to the duration and extent of today’s monetary experiment.

The obsession with short-term stimuli contrasts with the structural reform mindset back in the early 80s. Volcker was willing to sacrifice near term pain to rid the economy of inflation and drive reform. The turbulence he engineered led to a productivity boom, a surge in real growth, and a 25 year bull market. The myopia of today’s central bankers is leading to the opposite, reckless behavior at the government and corporate level. Five years ago, one could have argued it was in search of “escape velocity.” But the sub-par economic growth we are experiencing in the 8th year of a radical monetary experiment and in Japan after more than 20 years has blown that theory out of the water. And smoothing growth over a cycle should not be confused with consistently attempting to borrow consumption from the future. The Fed has no end game. The Fed’s objective seems to be getting by another 6 months without a 20% decline in the S and P and avoiding a recession over the near term. In doing so, they are enabling the opposite of needed reform and increasing, not lowering, the odds of the economic tail risk they are trying to avoid. At the government level, the impeding of market signals has allowed politicians to continue to ignore badly needed entitlement and tax reform.

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Look at the slide behind me. The doves keep asking where is the evidence of mal-investment? As you can see, the growth in operating cash flow peaked 5 years ago and turned negative year over year recently even as net debt continues to grow at an incredibly high pace. Never in the post-World War II period has this happened. Until the cycle preceding the great recession, the peaks had been pretty much coincident. Even during that cycle, they only diverged for 2 years, and by the time EBITDA turned negative year over year, as it has today, growth in net debt had been declining for over 2 years. Again, the current 5-year divergence is unprecedented in financial history!

6

And if this wasn’t disturbing enough, take a look at the use of that debt in this cycle. While the debt in the 1990’s financed the construction of the internet, most of the debt today has been used for financial engineering, not productive investments. This is very clear in this slide. The purple in the graph represents buybacks and M/A vs. the green which represents capital expenditure. Notice how the green dominates in the 1990’s and is totally dominated by the purple in the current cycle. Think about this. Last year, buybacks and M&A were $2T. All R&D and office equipment spending was $1.8T. And the reckless behavior has grown in a non-linear fashion after 8 years of free money. In 2012, buybacks and M&A were $1.25T while all R&D and office equipment spending was $1.55T. As valuations rose since then, R&D and office equipment grew by only $250b, but financial engineering grew $750b, or 3x this! You can only live on your seed corn so long. Despite no increase in their interest costs while growing their net borrowing by $1.7T, the profit share of the corporate sector peaked in 2012. The corporate sector today is stuck in a vicious cycle of earnings management, questionable allocation of capital, low productivity, declining margins, and growing indebtedness. And we are paying 18X for the asset class.


7

 {Slide 7} A second source of myopic policies is now coming from China. In response to the global financial crisis, China embarked on a $4 trillion stimulus program. However, because they had engaged in massive infrastructure investment the previous 10 years, and that was the primary stimulus pipe they chose; this only aggravated the overcapacity in the investment side of their economy. Not surprisingly, this only provided a short term pop in nominal growth. While we were worried about bank assets to GDP in 2012, incredibly, credit has increased by 70% of GDP in the 4 years since then. Just to put this in perspective, this means that since 2012 the Chinese banking sector has allowed credit to grow by the amount of the entire Brazilian GDP per year! Picture the entire Brazilian production in new houses and infrastructure. Incredibly, all this credit growth has been accompanied by a fall in nominal GDP growth from 15% to 5%. This is an extremely toxic cocktail for companies that have borrowed at 10% expecting 15% sales growth. Our strong suspicion therefore is that a large part of this growth is just credit flowing to otherwise insolvent borrowers. How else to explain the lack of NPL problem in heavy industries hit by lower prices and sales growth?

8

 As a result, unlike the pre-stimulus period, when it took $1.50 to generate a $1.00 of GDP, it now takes $7. This is extremely rare and dangerous. The most recent historical analogue was the U.S. in the mid- 2000’s when the debt needed to generate a $ of GDP increased from $1.50 to $6 during the subprime mania. Two years ago, we had hope the Chinese were ready to accept a slowdown in exchange for reform. Unfortunately, with the encouragement of the G-7, they have opted for another investment focused fiscal stimulus which may buy them some time but will exacerbate their problem. They do not need more debt and more houses.

 As the chart shows, this will remove a major cylinder from the engine of world growth.

{Switch to Slide 8
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I have argued that myopic policy makers have no end game, they stumble from one short term fiscal or monetary stimulus to the next, despite overwhelming evidence that they only produce an ephemeral sugar high and grow unproductive debt that impedes long term growth. Moreover, the continued decline of global growth despite unprecedented stimulus the past decade suggests we have borrowed so much from our future for so long the chickens are coming home to roost. Three years ago on this stage I criticized the rationale of fed policy but drew a bullish intermediate conclusion as the weight of the evidence suggested the tidal wave of central bank money worldwide would still propel financial assets higher. I now feel the weight of the evidence has shifted the other way; higher valuations, three more years of unproductive corporate behavior, limits to further easing and excessive borrowing from the future suggest that the bull market is exhausting itself.

If we have borrowed more from our future than any time in history and markets value the future, we should be selling at a discount, not a premium to historic valuations. It is hard to avoid the comparison with 1982 when the market sold for 7x depressed earnings with dozens of rate cuts and productivity rising going forward vs. 18x inflated earnings, productivity declining and no further ammo on interest rates.

The lack of progress and volatility in global equity markets the past year, which often precedes a major trend change, suggests that their risk/reward is negative without substantially lower prices and/or structural reform. Don’t hold your breath for the latter. While policymakers have no end game, markets do. On a final note, what was the one asset you did not want to own when I started Duquesne in 1981? Hint…it has traded for 5000 years and for the first time has a positive carry in many parts of the globe as bankers are now experimenting with the absurd notion of negative interest rates. Some regard it as a metal, we regard it as a currency and it remains our largest currency allocation.

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onsdag 4 maj 2016

Lite länkar

Jesse Felders blogg är en av de mer högkvalitativa bloggarna jag läser. Jag föreslår att man läser samtliga nedanstående korta inlägg. 

http://jessefelder.tumblr.com/post/143536935815/what-hath-the-fed-wrought

https://www.thefelderreport.com/2016/01/05/if-youve-been-wondering-whats-driven-the-recent-bull-market-in-stocks/

https://www.thefelderreport.com/2016/01/27/what-follows-the-most-epic-reach-for-yield-episode-in-history/

https://www.thefelderreport.com/2016/02/02/dont-dismiss-the-systemic-risk-of-a-corporate-credit-bust/

"Stanley Druckenmiller: Corporate America, China And The Fed Are Stuck… Buy Gold

“I have argued that the myopic policy makers have no endgame,” billionaire Stanley Druckenmiller said towards the end of a scathing twenty minute romp through all of the world’s economic problems. The U.S. debt is out of control, China is even worse, but the biggest offender of all is the Federal Reserve, Druckenmiller said.

Corporations in the United States are stuck in the mud, forlorn of growth, unwilling to invest, and addicted to share buybacks to gin up their stocks. It is a sentiment Druckenmiller has had for years, but the famed hedge fund manager indicated he really means it now. Eleven years ago, Druckenmiller warned the Sohn audience of then-Federal Reserve chair Alan Greenspan’s blunders in inflating an epic mortgage bubble, which was sure to crash.

On Wednesday, he said the bubble inflated by former chair Ben Bernanke and current chairwoman Janet Yellen is many magnitudes worse. The Fed, Druckenmiller said, is using low interest rates to ease borrowing costs and smooth over growing problems in the global economy. And this radical Central Bank accommodation is leading to unproductive investment, and is an issue that is even worse in China, an engine of global demand.

Whether it is S&P 500 Index corporations, U.S. households or the state-managed economy in China, Druckenmiller believes cheap money is borrowing from future growth, and will backfire spectacularly. ”While policy makers have no endgame, markets do,” he said.

Druckenmiller is increasingly nervous about risk assets and recommended investors take refuge in gold. "(http://www.forbes.com/sites/antoinegara/2016/05/04/battered-hedge-fund-stars-offer-up-new-ideas-at-sohn-investment-conference/#243cc90924c0)

Jag får kontinuerligt uppdatering om vad David Einhorn och Bill Ackman köper. För en tid sedan tog Ackman en enorm position i Valeant och Einhorn tog en stor position i Sunedision. Jag betraktade både Sunedision och Valeant och valde efter någon minut att inte göra ett köp. Balansräkningen var miserabel för båda bolagen och bolagen gick med förlust. Efter en initial uppgång började analytiker allt mer ifrågasätta de bägge bolagen och bolagens redovisning.

(pil anger approximativt när jag betrakta båda bolagen. Att jag inte köpte aktier i dessa bolag är inget tecken på briljans, utan jag undvek endast att köpa förlustgående bolag med enorma skulder. 

Dock kommer jag ihåg hur jag initialt ångra mig att jag inte följt med Einhorn in i Sunedision.)

 Valeant

Sunedison



Nedanstående blogg beskriver hur Sunedision utnyttjade finansiell ingenjörskonst för att blåsa upp ett luftslott. Goda lärdomar för alla placerare för att undvika att ryckas med i klassiska spekulationer kring förvärvande bolag.

http://basehitinvesting.com/lessons-from-the-fall-of-sunedison/

Valeant är också ett intressant case kring finansiell manipulation.

http://www.wsj.com/articles/valeant-an-accounting-pioneer-too-1450202504

"Data show an unusually wide gap between Valeant’s GAAP earnings and its cash-earnings figure. Under GAAP, the company posted $70 million in net income for the first nine months of 2015. Under its own cash-earnings measure, the company reported a profit of $2.7 billion. The cash-earnings measure strips out a host of costs, including acquisition expenses, inventory adjustments and stock payments to employees."

Cornucopia

Nedanstående inlägg från Cornucopia diskuterar antagandet att ekonomin ska gå mot en jämvikt? Vad händer om denna jämviktsnivå sjunkit de senaste åren eller inte finns överhuvudtaget? Risken är att stater/centralbanker stimulera för att försöka få ekonomin att återgå till en jämvikt som inte existerar och gör mer skada än nytta i sina försök att "stimulera".

http://cornucopia.cornubot.se/2016/05/industriarbetsgivarna-systematiskt.html

Trots massiva åtgärder från stater/centralbanker de senaste åren har de misslyckat att få "igång" ekonomin. Ingen normalbegåvad individ bör ha något förtroende för centralbankerna idag. Centralbankernas stimulanser har däremot varit verkningsfulla på marknaden och vad händer när även marknaden slutar gå i den riktningen "centralbankerna" önskar?

"Centuries later social psychologists have given the phenomenon an educated name: pluralistic ignorance. Put simply, it is where no one believes, but everyone believes that everyone else believes. A classic example is in a classroom setting where, after having presented the students with difficult material, the teacher asks them whether they have any questions. Even though most students do not understand the material, they may remain silent. The students interpret the lack of questions as a sign that the other students understood the material and, to avoid being publicly exposed as the stupid one, are reticent to ask questions themselves. Each student is aware of his or her ignorance with respect to some facts—but believes that other students are not ignorant of those same facts.

Pluralistic ignorance understandably can lead to errors on a grand scale. It’s a social phenomenon for people to make systematic errors in judging other people’s private attitudes. Nowhere is this more apparent today than in the public’s perception of the U.S. Federal Reserve System, a secretive and largely unaccountable monopoly, with an unprecedented experimental monetary policy of driving the price of credit to zero for the last eight years and counting. Even though we ordinary folk grasp the illusion of the proverbial “free lunch,” the Fed’s material is infinitely more imposing than that presented by the aforementioned teacher. We assume that others are privy to the special powers that the Fed possesses, and thus we suspend our disbelief. No one believes, but everyone believes that everyone else believes."( Frank K Martin, Martin Capital Management annual report 2015).

Personligen anser jag Bill Gross tankar ligger närmare verkligheten än den optimism som präglar ekonomers prognoser.

"Policymakers and asset market bulls, on the other hand speak to the possibility of normalization – a return to 2% growth and 2% inflation in developed countries which may not initially be bond market friendly, but certainly fortuitous for jobs, profits, and stock markets worldwide.

(...) But for the global economy, which continues to lever as opposed to delever, the path to normalcy seems blocked. Structural elements – the New Normal and secular stagnation, which are the result of aging demographics, high debt/GDP, and technological displacement of labor, are phenomena which appear to have stunted real growth over the past five years and will continue to do so. Even the three strongest developed economies – the U.S., Germany, and the U.K. – have experienced real growth of 2% or less since Lehman. If trillions of dollars of monetary lighter fluid have not succeeded there (and in Japan) these past 5 years, why should we expect Draghi, his ECB, and the Eurozone to fare much differently?

(...)At the Grant’s Conference, and in prior Investment Outlooks, I addressed the timing of this “ending” with the following description: “When does our credit based financial system sputter / break down? When investable assets pose too much risk for too little return. Not immediately, but at the margin, credit and stocks begin to be exchanged for figurative and sometimes literal money in a mattress.” We are approaching that point now as bond yields, credit spreads and stock prices have brought financial wealth forward to the point of exhaustion. A rational investor must indeed have a sense of an ending, not another Lehman crash, but a crush of perpetual bull market enthusiasm.

(...) I wish to still be active in say 2020 to see how this ends. As it is, in 2015, I merely have a sense of an ending, a secular bull market ending with a whimper, not a bang. But if so, like death, only the timing is in doubt. Because of this sense, however, I have unrest, increasingly a great unrest. You should as well." (http://jordholmen.blogspot.se/2015/06/hur-man-loser-en-skuldkris.html)