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GirlsUnder30 (94.05)

The awesome opportunity with GTAT

Recs

6

February 28, 2013 – Comments (19) | RELATED TICKERS: GTATQ , NFLX

I have been following this stock for some time. I took a nibble at $4 and am ready to go in with both fists. Here is why:

To my surprise, the 25% hump we saw over Valentines Day in this stock was NOT short covering so there are some ballsy players in this stock who I hope don't get neutured. All but 13 million shares of this stock are held by institutional investors and there are at least 30 MILLION SHARES SHORT!!! This creates a situation just like NFLX where the scarcity will put incredible upward pressure on the stock which can only be relieved by a sympathetic or forced seller. I just finished my first pass reading over the financials and they don't look that bad. Of the reported loss, $1.36 is attributable to non-cash items. They resolved their upcoming covenants with BA and increased liquidity if they need it. They pared their deferred revenues and have only about $0.15 of inventory risk if their customers don't survive. Forward guidance suggests a 7-12x P/E for 2013 WITHOUT including any talk of their upcoming FD-SOI business which I believe could surprise everyone with its success. Piper Jaffray has an overweight recommendation @$3.42 and trackPiperJaffrey has a near 90 fool CAPS score. This one looks like an awesome winner to me. 

19 Comments – Post Your Own

#1) On March 08, 2013 at 1:52 PM, DrGoldin (99.68) wrote:

Are you sure about Piper Jaffray?  From what I see, their current call is Neutral.  TrackPiperJaff is actually showing a red-button call on the CAPS page for GTAT, but I think that's wrong.  Goes to show that CAPS scores for these tracked Street calls aren't always accurate though.

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#2) On March 17, 2013 at 1:04 PM, RallyCry (< 20) wrote:

Whats the outlook for AMAT? still bullish?

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#3) On March 19, 2013 at 11:37 AM, GirlsUnder30 (94.05) wrote:

DrGoldin, they may have changed their outlook but I do remember reading the overweight from either P-J or their investment affiliated Canaccord at the time prior to the rise in the stock around Valentines Day. The stock is a very strong short squeeze candidate

RallyCry, the stock is way cheap under $13 in my opinion. I'm overweightedand and expect the stock to be $17 by this year and $24 by next year.

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#4) On April 09, 2013 at 10:31 AM, GirlsUnder30 (94.05) wrote:

This blog got awful quiet. I really suspected this would be my most popular blog post given the enormous short position and the very strong upside potential of this company. If anyone reading had heeded my advice they would be about 25% richer in GTAT stock today.

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#5) On April 13, 2013 at 4:35 PM, 007mercucio (< 20) wrote:

I was heeding without reading.  LOL.  Going long with this one.  I think GTAT has alot of potential.

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#6) On May 08, 2013 at 1:48 PM, GirlsUnder30 (94.05) wrote:

A month later and now going to 50% 8^)

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#7) On May 17, 2013 at 3:51 PM, GirlsUnder30 (94.05) wrote:

Okay, it's time to take some off the board and here is the how and why:

1. reduce your long exposure to GTAT at the current prices. If you'll net over a $1.50 (%50) on the stock take the gain because we will see a retraction coming soon that will last over a year. I was heavily overweighted in it and plan to reduce my position 80% by June.

2. The reason for the retraction will be indigestion of its current acquisition and liquidity problems.

3. Selling the $5 calls through December is a good way to make holding this stock less painful.

I'm so surprised this thread hasn't hit at least 5 recommendations yet.

 

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#8) On October 04, 2013 at 8:52 PM, banmate7 (< 20) wrote:

I'm up 102%. Why? Buy and hold. Moreover, as we discussed on another article, I'm in GTAT on the basis of faith in them having a business moat in the solar and sapphire supply chains.

 Suffice it to say, I still admit that I'm merely lucky & that there is no real analysis to be had here...except that the lack of solid earnings, profits, and stability make GTAT a huge risk. This also underscores why most of my money is in solid blue chips purchased at value.

In contrast, you feign knowledge and expertise with short term predictions. Well, look at how that turned out. You advised me to take money off the table a few months ago. Like I said, I am up 102%.

You ultimately are playing roulette. At least I admit it with my investment in GTAT. I hope others see through your "advice".

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#9) On October 17, 2013 at 12:54 PM, GirlsUnder30 (94.05) wrote:

Okay, you are entitled to your opinion. I like locking in a profit when the future is uncertain and freeing capital for other investments like CGR. We'll see how things look after the financials are reported. By the way, how was my feigned knowledge when I suggested that AMAT would outperform GLW?

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#10) On October 17, 2013 at 10:21 PM, banmate7 (< 20) wrote:

Our exchanges about GTAT absolutely exemplify the pitfalls of a short term trading approach, especially one based on superficial facts & analysis. And I emphasize the term "superficial" here. Very little of what you attempt to pass on as analysis has real correlation to stock performance. 

The icing on the cake is that you spoke with such surety and authority, almost daring people to question you. You advised me to liquidate a signficant portion of my GTAT shares, when I was averaged in at $4.40. It's pretty telling how things turned out, isn't it?

As I said, you're basically playing roulette. Nothing more. In contrast, I'm a value investor. I am honest about characterizing my occasional non-value investments, like GTAT, as a pure gamble. There is no surety on my part here. Even with value investing, I talk about it in terms of odds based on well know value metrics & analysis. I often provide a detailed history of my investments, corroborating long term performance, including dollar amounts.

I challenge you to provide the same. Give us a cross section of investments. Let us judge within a greater context, as opposed to you providing select information making you look good.

As for GLW, like I said, I'm a value investor & confident that this will beat the market over time. At the very least, the odds are high that I'm not going to lose money. That's the way I invest, accumulating at value, waiting patiently, reinvesting dividends. I can discuss GLW PE & PEG, cash flow, balance sheets again, explaining why there is compelling value here.

Lastly, you once said GLW was an oily company. I suggest you read the September 23 issue of Forbes. They have a solid article on this venerable and successful company. It might change your mind...and perhaps open your mind up to looking at such companies through more mathematical based analysis.

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#11) On October 18, 2013 at 12:22 PM, banmate7 (< 20) wrote:

By the way, AMAT has run up nicely. But so have CRM & WKDAY. Yet none of them have compelling value metrics, making them very speculative. You might get lucky in the short term, but the market ultimately normalizes stock price to reasonable multiples. It's a matter of "when", not "if".

That's why I won't invest in AMAT right now. The PE is sky high. In my mind, it would be another GTAT type investment, albeit much stronger in terms of cash flow. I can't afford too many of these types of investments, which offer higher odds on going south. 

Most of all, I can't be trading in and out either in pursuit of short term growth. Again, I challenge you to provide detail on long term performance doing such trading. Most actively managed mutual funds can't beat the indices, never mind you.

On the other hand, I've handily beaten indices by value investing in KO, CNI, INTC, MSFT, TRN, AAPL, NOV, DOW, and such blue chips. Buy. Hold. Reinvest dividends. Sleep peacefully.

Like I said, this type of investing has some mathematical underpinnings. PE. PEG. Estimated growth. Ways to calculate fair value. Etc.

It's a bit more substantive & given to corroboration than Jim Cramer lightning round advice...don't you think?

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#12) On October 18, 2013 at 4:57 PM, GirlsUnder30 (94.05) wrote:

banmate7

When did I ever suggest you sell @ $4.40? I went overweight in this stock to the point of margin so I sold off some when I was up 60% to relieve that. I got in a lot earlier than you and so I could afford to lock in profits before you but had you heeded my advice, you would have sold off a portion at $6.60 and held. We'll see how much better than $6.60 GTAT finishes the year and then you can comment with some credibility. I began accumulating other positons with my gains and have continued to seek other opportunities which have all gained about the same as GTAT from the price I sold it at and are positioned for even greater gains than it going forward. Buy and hold by itself is not the best strategy for maximum return but as I stated before, you can try to paint my 43% over market returns over the past three years as luck. I know it isn't.

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#13) On October 18, 2013 at 5:50 PM, banmate7 (< 20) wrote:

On the GTAT thread, you advised me to take money off the table when I was averaged in at $4.40. You said to move on $1.50 profit. You said a retraction was imminent & would last 1 year. You said to sell $5 calls through Decemember to make owning GTAT less painful.

Again, how did that turn out? 

 

 

As to credibility, do you realize I was up %100+ at some point? I am up 93% as of today. Sorry, the jokes on you.

 

Face it, you have no more of an idea on where GTAT is going than the next person. Again, at least I have the honesty to admit this investment is nothing but me gambling on the idea that GTAT has a business moat deep in solar & sapphire supply chains...knowing that these markets most certainly are not fully developed yet, hence the extreme risk.

 

By the way, what does 43% over market mean? How much money did you wage across which instruments? Again, you provide no evidence, just anecdotes that easily can be doctored up.

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#14) On October 19, 2013 at 10:01 AM, GirlsUnder30 (94.05) wrote:

banmate7

The market is up around 70% in that time period, do the math. It's odd that your CAPS score does not reflect the wonderful success you have in real life. For the record, that advice worked wonderfully for me. The whole GTAT story hasn't been told yet and if you are still holding and not taking a profit, you won't need the benefit of my analysis to tell you what happened, your position will explain it most eloquently..

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#15) On October 21, 2013 at 2:30 PM, banmate7 (< 20) wrote:

You still provided no analysis. Let me explain my so called "buy & hold" analysis. Consider how I value invested into CNI.

I initially tuned in to railroads because Warren Buffett bought shares in BNI. I immediately began to look into railroads & railroad supply chain companies. All the railroads had run up, well above their 15 year trailing PE & PEG...except CNI. It was selling at $55 at a PE=14, fair value. However, the avg growth rate x operating earnings growth rate made it a fair value of around $67. I reviewed all this on FASTGraphs.

So I made my "value investment". Here it is, in detail:

Trade_Date shares  total_price price/share
05/14/2008 179.194 $10,009.13  $55.86
07/01/2008 0.856   $40.57      $47.39
10/02/2008 0.842   $39.18      $46.53
01/02/2009 0.91       $34.25      $37.64
04/01/2009 1.041   $36.48      $35.04
07/01/2009 0.92    $39.87      $43.34
10/01/2009 0.892   $43.50      $48.77
01/04/2010 0.812   $44.65      $54.99
04/01/2010 0.806   $49.30      $61.17
04/08/2010 0.809   $49.48      $61.16
07/01/2010 0.839   $47.49      $56.60
10/01/2010 0.767   $49.14      $64.07
01/03/2011 0.757   $51.21      $67.65
04/01/2011 0.832   $63.32      $76.11
07/01/2011 0.803   $63.92      $79.60
10/03/2011 0.908   $59.37      $65.39
01/03/2012 0.764   $61.11      $79.99
04/02/2012 0.91    $72.28      $79.43
07/02/2012 0.843   $70.91      $84.12
10/01/2012 0.83    $74.02      $89.18
01/02/2013 0.79    $73.42      $92.94
04/01/2013 0.832   $82.88      $99.62
07/01/2013 0.817   $80.27      $98.25
10/01/2013 0.804   $82.47      $102.57

total shares:  198.578     
original cost: $10,009.13
current value: $21,188.27

This is almost a %110 total return. The S&P500 returned 22% during the same time period. These are real numbers using a value investing methodology. This is something that can be corroborated, as opposed to the random "analysis" you issue.

By the way, the S&P500 did not return 70% in the last 3 year, not according to Yahoo finance. More like 48%. At least try to get your facts right.

Lastly, today I am up 105% in GTAT. Again, this outcome obviates your Jim Cramer lightning round like quips. And as with Jim, I have to say it's entertaining. But at least Jim admits that's his business.

:)

Kidding aside, Jim is actually correct and sage when he's more measured. He actually does spend some time explaining fundamentals. So should you.

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#16) On October 21, 2013 at 3:20 PM, banmate7 (< 20) wrote:

It's odd that your CAPS score...

I have no idea what a CAPS score is?

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#17) On October 21, 2013 at 5:15 PM, GirlsUnder30 (94.05) wrote:

banmate7

Is the S&P the only market gauge? Which month did you use as the cutoff? My facts are straight and so are my numbers, see that <20 reading next to your login? That is your CAPS score and a measure of how your recommendations rate against your peers. I think I've said enough to you, in this case, your irritating nature will not get me to produce a pearl for you. 

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#18) On October 21, 2013 at 6:10 PM, banmate7 (< 20) wrote:

I pay absolutely no attention to MF CAPS scores, whatever those might be. I simply invest & am always on the lookout to learn something new, even a tip. Believe me, I like being proven wrong, as I ultimately refactor my frame of reference in an attempt to become a better investor. Unfortunately you've provided nothing of the sort.

It's clear you are very unseasoned. Your heart might be in the right place, but what you posit as knowledge and expertise simply isn't. Anyway, I leave you with one more example of how I invest. Here is an example of how I took a position in DOW.


Trade_Date shares  total_price price/share

08/23/2011  196.0  $5,024.59  $25.64
10/28/2011  1.705  $49.00     $28.74
01/30/2012  1.498  $49.43     $33.00
04/30/2012  1.458  $49.80     $34.16
07/30/2012  2.198  $64.21     $29.21
10/31/2012  2.224  $64.91     $29.19
12/31/2012  2.051  $65.63     $32.00
04/30/2013  1.966  $66.28     $33.71
07/30/2013  1.915  $66.91     $34.94

total shares:   211.015
original value: $5,024.59
total value:    $8,725.47

I got in at $25 at a PE=12 when over the past 15 years it has an average PE=22. Mind you, I used a PE=16 as an ideal basis here, smoothing out dot com kind of valutions. DOW pays a 3% dividend, which I reinvest.

You can see the PE normalized back to 18 right now. I have about a 70% gain when the S&P500 returned 50% during the same time.

Additionally, on these types of investments, including most in my profile, I sleep soundly at night. I don't go in & out willy-nilly. And as you can at least see with these 2 examples, I significantly beat the S&P500, merely by applying time tested value investing.

And one more time: if I liquidate GTAT today, I gain 105%. But I'll hold, keeping faith with GTAT in emerging solar & sapphire market opportunities. I'll leave you with this encouraging snippet from another message board: Its revenues declined by 78% from $271.6M in Q1-11 to $57.7M in Q1-13. However, its revenues rebounded in Q2-13 to $168M, which may be the start of a long term trend.


Hardly definitive. But enough for me to keep my hopes alive for even more gains here. I am prepared to lose my money in the wait. We will see.

 

All the best to you. 

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#19) On October 23, 2013 at 1:11 AM, banmate7 (< 20) wrote:

Corning! 

:)

 

 Ok, I'll take my leave now. Best of luck in the future...to all of you.

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