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July 2013

Recs

12

Mene, mene tekel upharsin

July 31, 2013 – Comments (9) | RELATED TICKERS: BWLD , SLM

I don't think anyone reads these blogs anymore, so I am going to feel free and easy and have a little fun with this entry.  [more]

Recs

1

AAPL innovation

July 29, 2013 – Comments (0) | RELATED TICKERS: AAPL

Bob Mansfield left Apple this weekend.  He had tried to retire in June 2012; so it's not exactly stunning.  Reports are that he was paid $2 million a month to stay on since then; heck, in that situation I'd probably 9-to-5 another year at nearly any desk job you cared to name for a year, take my shiny new Tuscan castello, and run.  [more]

Recs

6

BWLD - Still long

July 21, 2013 – Comments (0) | RELATED TICKERS: BWLD

I've been long BWLD for a couple years, and I have gone in and out of an NFL phase during that time, when I really wished they would open a franchise or two in my area.  Someone owns those franchise rights but hasn't developed them yet; and I always had "visit a BWLD franchise" on my list of things to do over the last years.  [more]

Recs

5

Noodles and Co - fairly valued for all its future growth

July 19, 2013 – Comments (3) | RELATED TICKERS: NDLS , CMG

I read a good Motley Fool analysis of NDLS just now.  When valuing this kind of stock - a new restaurant chain that has proven its acceptance among consumers but has not come anywhere near to saturating its target market with locations - I always think of Peter Lynch, who (speaking of Taco Bell in the 80's) said that such a stock is a "screaming buy" when its P/E is 20.
If NDLS' P/E is 450 now, then it is 22.5 times as pricey as it would be if it were a Peter Lynch "screaming buy."  In other words, earnings would have to double 22 times before Lynch would consider it to be fairly priced at this level for its future growth.  If we ignore comps growth and focus only on new restaurants, that means that it would have to have about 7100 restaurants in order to be a 'screaming buy' at this price. 7100 Noodles and Co. restaurants, however, might pretty well saturate the American market!  They might have trouble opening new restaurants if there were already one on most city street corners - they'd be competing with themselves. I'm not a buyer of NDLS here.  If I shorted stock, which I don't, I would consider shorting it at these prices.  (Trouble with going short is you need a catalyst - something to make Wall St. wake up and smell the coffee - and I have no idea what that would be in the case of NDLS.) Still long CMG, by the way; still happy with earnings growth; still happy with my basis.  Hope you all got in at 241 when I told you to!  [more]

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