Monday, February 17, 2014

Natural Gas At A Crossroads: Heading For A Shortage Or is The Market Still Oversupplied?

Against The Backdrop Of An Extremely Cold Winter, The Natural Gas Market Wavers

Natural gas prices have been in the dumps for a couple of years as the drillers found lots and lots (and lots) of gas reserves onshore in the US that are extractable at a reasonable cost using modern production technology.  As producers went hog wild in drilling wells, inventories piled up, prices crashed ($2/MCF natural gas was not that long ago) and natural gas consumers (utilities, chemical companies, etc.) starting burning up as much of the stuff as they possibly could.  It seemed the glut of natural gas would never go away and prices would always be low.  However, the winter of 2013-2014 has proven to be one of the coldest in a couple of decades and demand has suddenly ballooned for natural gas as heating fuel.  The overhang of excess supply is about gone as everyone tried to stay warm and prices have risen to in excess of $5/MCF for the front month future and $4 and change for the rest of the futures curve. In times past when supplies have gotten short in the natural gas (and just about every other commodity) market, it has not been uncommon to see parabolic upward moves in the price of the commodity.  However, natural gas is nowhere near panicky shortage pricing that has been seen in the past (natural gas was $20/MCF after the 2005 hurricane season), perhaps due to the view that we are still standing on a sea of natural gas and any shortfall in supply will be temporary.  Which way will natural gas prices move in coming months and more importantly how can an investor most appropriately make money off whatever direction the market moves?

Wednesday, February 12, 2014

Stable Value Funds: 8th Wonder Of The World Or Smoke And Mirrors?

How Stable Value Funds Work And How Best To Use Them

Get it?  A stable.

Many 401k and 403b plans have a stable value fund (AKA interest income fund) as one of the investment options.  These funds don't have a ticker symbol, have sometimes rather vague and opaque disclosure documents available on them, and it is hard to get any research or informed opinion on them. Stable value funds are only offered in "qualified" retirement plans such as 401ks and 403bs.  All most plan participants know about them is that they are "stable" and sometimes what the current interest rate offered by the fund has been recently.  In this post I will discuss how these funds are constructed and the best way to use them in your 401k or 403b.

Friday, February 7, 2014

Published On Seeking Alpha: Navios Acquisition: A Quality Company At Close To Net Asset Value

With one of the strongest management teams in the industry and a preference for long term charters to mitigate the high risk inherent in the shipping industry, Navios Acquisition (NNA) has survived the global recession, a period of greatly restricted funding for ship owners, and the bankruptcy and financial distress of less well-positioned industry peers. After a recent sell-off from 52 week highs, the company appears to be a good value for investors desiring exposure to the crude and refined products tanker business as the company's shares trade at a small premium to net asset value.

To see the rest, go here:

As always, this is meant as entertainment rather than investing advice.  Consult your advisors, throw the yarrow sticks and get out the I Ching, do your own due diligence, take you own risks.

Wednesday, February 5, 2014

Update: My Seeking Alpha Article On PTRY Selected As A Top Idea Of The Day

Since this is only the second piece I have submitted to Seeking Alpha, I don't know how rare this is for a contributor, but I imagine that its not that common given how few I see in the list:

Now to find out if I get paid more for such great work...

Tuesday, February 4, 2014

Published On Seeking Alpha: The Pantry Is Empty: The Pantry Inc. Is Overvalued And Overleveraged

The Pantry, Inc. (PTRY) has made numerous changes to the company and its operations, hired a new CEO, remodeled stores, and even attracted a modicum of activist investor attention. Yet the company continues to see a steady slide in EBITDA, uses all of its cash flow to service debt and spruce up its stores, and has leveraged up its balance sheet in the process to the point where the firm has little room for error. The Pantry appears to be an obvious short based on declining operating performance, high leverage, and management's apparent inability to stem the deterioration of both the business and the balance sheet.

To see the rest of the article go here:

As always, this is for your entertainment only, not investment advice.  Consult your advisors, do your own research, take your own risks.  I am just some dude spouting off over the interwebs.

Monday, February 3, 2014

Insurer Nastygrams: When Long Term Care Insurance Premiums Rise

Why This Has Been Happening And What To Do If You Are Affected

If you are a long term care (LTC) insurance policyholder who has had a policy for five or more years, you are likely to get an unpleasant piece of mail if you have not already: a whopping increase in your LTC insurance premium.  Double digit percentage increases are the norm and 85% and higher increases have been levied on some policyholders.  Worse yet, just because you had your premium increased significantly does not mean that you will not see your policy cost rise even further in future years.  To add insult to injury, several significant players in the LTC insurance market have seen their credit profile degrade resulting in lower claims-paying ratings, raising the chance that they will have difficulty paying claims down the road.  In this post I will discuss the economics of LTC insurance, how insurers got themselves into trouble with this product (necessitating giant rate increases), and what to do if you have an LTC insurance policy and get slapped with one or more premium increases.