Down goes the Dow

Joe,

Yes, a perfect answer from someone that doesn't have an answer to a logical and well grounded argument.

But I knew a similar response would come from you, and you will deserve what you get in the end.

Igy

K5 detector wrote:

I didn't do that. Are you drunk again, K5?

You say the same things over and over and over again.

I hope you are copying and pasting.

For Tesla fans:

Net Loss six months ended June 30, 2015: ($338,408,000) or ($2.68) a share

Net Loss six months ended June 30, 2016: ($575,455,000) or ($4.22) a share

Company liabilities increased $2,374,562,000 in the six months ending June 30, 2016

In the Non-GAAP Financial Information section of the 8k: "We are currently in the process of evaluating this guidance with respect to our use and presentation of non-GAAP financial measures, and have already taken certain steps to modify our prior disclosure practices in this area."

Is there such a thing as a negative PE ratio?

Igy

Big Dog Investments wrote:

I definitely rate Ford a "buy" right now. Unfortunately I have no cash on the sidelines at the moment and am not willing to take any profits quite yet, so I won't be partaking. I envy those of you who are getting some.

I got in today with a few shares. The price got low enough so I could use the few pennies I had without taking any profits. Wish it could have been more.

Ghost of Igloi wrote:

Joe,

Yes, a perfect answer from someone that doesn't have an answer to a logical and well grounded argument.

But I knew a similar response would come from you, and you will deserve what you get in the end.

Igy

Answers are for questions, not arguments. And I thought we were having a discussion, not an argument.

You obviously are having a hard time defending your position. That makes sense given the downright irresponsibility of recommending such a conservative position for someone beginning their retirement years. The fact that you do not even understand the simple concept of indirectly increasing a client's equity allotment does not speak well of your knowledge base.

I feel sorry for your clients. They are undoubtedly in for tough times in their later years right when they will need money the most.

Mein Gott wrote:

Isn't it against Letsrun policy to steal people's names?

There is abundant evidence that the name "Ghost of Igloi" has been stolen. Consider the fact that the real "Ghost of Igloi" announced his departure from this thread weeks ago.

Don't feed the troll.

Will Joe Beets have mercy on poor Igy's soul.

Troll is you, Sally V, Joe Mama, I mean Beets, same family....

Joe,

Look, I bet this Igy approved portfolio is doing better than you.....

http://www.morningstar.com/funds/XNAS/HSTRX/quote.html

Oh, what is "the simple concept of indirectly increasing" an equity position?

Igy

His dystopia is fueled by diss-information and diss-tortion, insulting rivals with disturbing, exaggerated and cherry-picked facts and unsubstantiated assertions a

Sally here is a good fund for you. Morningstar ****, numero uno on a one year basis, no more stock picks, and less than average risk.....

http://www.morningstar.com/funds/XNAS/HSTRX/quote.html

Don't say I didn't give you sound advice.

Igy

Ghost of Igloi,

I have become curious about this issue of GAAP vs NON GAAP reporting. Reading some of your posts in this thread you are suggesting that there is a standardized NON GAAP method of reporting earnings. Do you have link of where you get this information. This issue does worry me.

GAAP is an arbitrary set of principals and rules. But it is a comprehensive rationale way to measure corporate finances. And its crucial to have a base method that everyone agrees on to compare performance.

Its fine to highlight "special items" that are one time events such as Ford taking a write down on its Venezuela segment. And its good to show "non cash" expenses such as depreciation. But then that is why corporations are required to provide cash flow statements.

Its not clear to me how far this NON GAAP movement is going.

One criticism I have heard is companies highlighting front and center the adjusted Non GAAP numbers they want investors to see. But burying the GAAP numbers deep in the report. That strikes me as slightly shady but basically fine.

What bothers me is reading about NON-GAAP S&P 500 PE ratios. That tells me that someone is creating their own universe of measuring financial performance. If the media is pushing that and not saying it is Non-GAAP. That can be a big problem.

GAAP is standardized, NON-GAAP is not. The latter takes into consideration factors that effect earnings, but are not reflected in GAAP.

Because NON-GAAP isn't standardized, there is room for some funny business. But they also can shed light on very important information regarding the companies finances.

Smart investors look carefully at both. Often the truth lies somewhere in between.

Ryan,

Your analysis is correct. The use of non-GAAP to "highlight" an earnings beat rivals the Tech Bubble, where it was often referred to as pro forma earnings. My view is as the GAAP numbers have continued to decline corporations and the media have relied on non-GAAP to pretty up declining fundamentals. Not only does GAAP have a rules based components, the CEO and CFO sign off that the numbers are accurate under penalty of imprisonment, which is not the case with non-GAAP.

The problem of using non-GAAP exclusion of stock based compensation is obvious. Special items is interesting as some corporations use a more conservative approach. Microsoft has moved to more aggressive accounting which forva time benefitted the stock price because it reinforced the story of growth. Similar to using stock buybacks to juice the numbers. There is just a limit to how far or long it can go.

The media and analysts have become lazy and for the most part complicit in promoting the myth of "better than expected." One must admit to the inconvenient truth that their paychecks are linked to the direction of the market. In this business, the choice to be more conservative in your investments is a decision to take a pay cut.

I good place to educate yourself, if you have not done so yet, pull up a quarterly report. A good place to start would be the TSLA 8-K. Another would be Service Now (NOW). Here are two companies that are spending gobs of money to "generate" growth, and investors are giving them a pass on accountability. This is not an indictment of the respective businesses, just of the investment.

If you wish further information on GAAP versus non-GAAP make a Google search, add the name Mary Jo White the Chair of the SEC.

Igy

Ryan,

If I am a buy and hold investor, I should want my companies to be conservatively managed. Why? Because lax corporate governance, aggressive non-GAAP accounting, rising debt levels, and increasing stock buybacks have proven to be, individually and collectively, destroyers of shareholder value.

Igy

So why are the markets setting records?

Ryan,

Here is an article discussing non-GAAP accounting in reference to Valaent (VRX) and the securities industry generally. Interesting to note the stock was trading around $100 at the time of the article, having fallen from $262, today trading in at $22.50.

http://www.nytimes.com/2015/11/01/business/valeant-shows-the-perils-of-fantasy-numbers.html?_r=0

Igy

Read my the article I posted above on Valaent and you might get smarter.

Igy

Ghost of Igloi wrote:

Joe,

Look, I bet this Igy approved portfolio is doing better than you.....

http://www.morningstar.com/funds/XNAS/HSTRX/quote.html

Oh, what is "the simple concept of indirectly increasing" an equity position?

Igy

I have to assume that you didn't look at that very carefully. Did you notice the growth graph, specifically the 60% stock fund that blew away the conservative Hussman fund?