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Entries from October 2018

BioLife: Groundfloor Opportunity In Regenerative Medicine

October 30th, 2018 · Comments Off on BioLife: Groundfloor Opportunity In Regenerative Medicine

We clued in to BioLife a couple of months ago, but we found the valuation a little too steep. That has been taken care of. If anything, we see even more potential this time around. To boot, the company is already generating positive cash flow and produced its first net profits. Source: BioLife: Groundfloor Opportunity […]

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Tags: BLFS

Deregulation Isn’t Always Pro-Growth, Even When It’s Pro-Business

October 30th, 2018 · Comments Off on Deregulation Isn’t Always Pro-Growth, Even When It’s Pro-Business

Deregulation is often believed to spur economic growth and therefore be business and shareholder friendly. However, there are instances where it is indeed business and shareholder friendly, but not market friendly, as it can confer market and pricing power to insiders. So once again, we have to stress the difference between market friendly and business […]

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Tags: Economic Policy

Italy Versus The Markets, A Very Predictable Outcome

October 30th, 2018 · Comments Off on Italy Versus The Markets, A Very Predictable Outcome

The Italian populist government is defying the markets at exactly the wrong moment, with growth and ECB bond buying waning. Its proposed budget will increase the already sky-high debt/GDP ratio further, and this can easily set off a confidence crisis, given a number of vicious cycles that are looming. Italy can’t win a showdown with […]

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Tags: Eurocrisis

Vericel Corporation Holds Longer-Term Promise

October 30th, 2018 · Comments Off on Vericel Corporation Holds Longer-Term Promise

The promise is already there for patients, but shareholders will gain as well, in our view. Revenues will grow 25-30% this year and margins are improving and the company has plenty of cash, it’s even looking for acquisitions. The shares have sold off with the general market, buying a few on a downturn will pay […]

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Tags: VCEL

Perennial Tax Cuts

October 24th, 2018 · Comments Off on Perennial Tax Cuts

Tax cuts are seen by some as the necessary, indeed almost the only instrument for economic growth. A sort of magical formula for all times and circumstances. The resulting deficits should be met with public spending cuts, so the agenda really is shrinking the state. This overlooks large distributional consequences, and there is little to […]

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Tags: Economic Policy

Takeaways From The Skechers Quarter

October 24th, 2018 · Comments Off on Takeaways From The Skechers Quarter

While it’s always a little hard to see the forest through the trees, given that the company has so many moving parts, we think the overall picture is still attractive. While international growth is slowing down, there is still plenty of that left, and even domestic performance has still mileage. We like the company especially […]

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Tags: SKX

Man Against Machine: How Retail Gets Smashed By Violent Algos

October 24th, 2018 · Comments Off on Man Against Machine: How Retail Gets Smashed By Violent Algos

We see several tech shares off their highs by 20%, 30% or even 40% in short order, seemingly without any deterioration in their business outlook. The likely culprit: algos violently de-risking portfolios. How should retail deal with these situations? We have a few ideas. Despite significant opportunities opening up, we’re not yet buying. Source: Man […]

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Tags: AYX · NTNX

Workday Is Fine But The Markets Aren’t

October 23rd, 2018 · Comments Off on Workday Is Fine But The Markets Aren’t

Acquisitions and new modules have expanded the TAM and will keep revenues growing for some time to come. While the company is non-GAAP profitable, there isn’t yet much operational leverage, and share-based compensation is huge. We don’t see much reason for multiple expansion either. In fact, multiples could contract in times of market turbulence when […]

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Tags: WDAY

Sell-Off In New Relic Offers An Opportunity

October 23rd, 2018 · Comments Off on Sell-Off In New Relic Offers An Opportunity

New Relic is the leader in an industry that is still in the very early innings with lots of growth ahead of it. Coming up with new applications broadens its TAM and offers increasing opportunities for up-selling. Unlike many other cloud platforms, financials are already very sound with substantial cash generation and non-GAAP profitability. Source: […]

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Tags: NEWR

It’s Darkest Before The Himax Dawn

October 23rd, 2018 · Comments Off on It’s Darkest Before The Himax Dawn

Revenues are likely to receive multiple positive impulses going forward from here on. So growth is ahead while today we see a maximum impact from higher CapEx and R&D spending. The shares seem to reflect the latter, less so the former. That is, we’re at the point where it is darkest before dawn and we […]

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Tags: HIMX