Eventually Consistent Capital

🔭α
"Not hyperactivity but a hell of a lot of patience. You stuck to your principles and when opportunities came along, you pounced on them with vigor." -C.M.

[Eventually Consistent Capital @EventuallyCC]

And then there were none...
Except for bots & impersonators. ✖

[Eventually Consistent Capital @EventuallyCC]

@BagholderQuotes I withdraw my request for your return to this 💩show. RIP Twitter.
https://t.co/3Qgems3iIH

[Eventually Consistent Capital @EventuallyCC]

And then there were none...
Except for bots & impersonators. ✖

[Eventually Consistent Capital @EventuallyCC]

@MarketDraft Read the notes.
https://t.co/3Yi6b3l5pQ

[Eventually Consistent Capital @EventuallyCC]

$PGR 🔼10% because: the calendar. 🤦‍♂️

"Net premiums written growth rate reflects that 1st day of July, which is historically a higher volume day, is included in fiscal Jul23, compared to fiscal Jun22."

Even so, combined ratio is worse y/y, & policies-in-force growth is unchanged

[Althea Spinozzi @Altheaspinozzi]

🇯🇵 An horrible 20-year JGB auction today tailed the most since 1987, showing that investors require a higher yield to buy JGBs.

Rising JGB yields threaten bonds worldwide, so we see EU and US sovereign yields accelerating their rise this morning.

@saxobank @SaxoUK

[Eventually Consistent Capital @EventuallyCC]

And would someone check to see if $FDX investors are still breathing?

Even before the bond meltdown, FedEx's package volume was down below 2019-levels.

But $FDX stock hasn't yet looked down to see the thin air between it and $UPS (the better shipper).
https://t.co/OSyiMfcoNr

[Eventually Consistent Capital @EventuallyCC]

$FDX FedEx is not delivering a soft landing.
You need to go back 5 years to 2018 to find a May-ending quarter with fewer average packages, and volume is falling further.

[Eventually Consistent Capital @EventuallyCC]

@avgvalueinvest Thank you, one quibble: yes interest expense is so far lower this year, but BLDR is now paying 7% vs 3.7% interest on it's rapidly-growing revolving balance.
I can't dispute the rest.

[Eventually Consistent Capital @EventuallyCC]

@Nesjamag @avgvalueinvest "Invest in preparedness, not in prediction." -Taleb
I'm prepared for BLDR stock to be MUCH less valuable over the next couple of years, as the buyback machine gets gummed up by the accumulated debt.

[Eventually Consistent Capital @EventuallyCC]

@Nesjamag @avgvalueinvest The problem with that is their cash flow is drying up, and most recently they were paying 7% interest on the revolving funding of those buybacks.
https://t.co/x1rvpzsJuG

[Eventually Consistent Capital @EventuallyCC]

$BLDR Builders FirstSource:
Tell me business is deteriorating without telling me.

Last year BLDR was repaying their revolving credit facility, but this year they are drawing from it as cash flow is drying up. And this is *before* times get tougher for #homebuilders in recession.

[Eventually Consistent Capital @EventuallyCC]

@avgvalueinvest No sorry, BLDR overpaid >$2.5B for growth during the pandemic housing boom (overpaid measured by goodwill). This growth strategy can work during the good times, but inefficient bloat can rear its head in a downturn.

As the $ dries up, BLDR uses expensive debt for those buybacks.

[Eventually Consistent Capital @EventuallyCC]

@A_jrk23 Because they are so overvalued.
https://t.co/x1rvpzsJuG

[Eventually Consistent Capital @EventuallyCC]

$BLDR Builders FirstSource:
Tell me business is deteriorating without telling me.

Last year BLDR was repaying their revolving credit facility, but this year they are drawing from it as cash flow is drying up. And this is *before* times get tougher for #homebuilders in recession.

[Eventually Consistent Capital @EventuallyCC]

@Sir__Tyler Might not take his word for it, but instead check his numbers.
https://t.co/x1rvpzsJuG

[Eventually Consistent Capital @EventuallyCC]

$BLDR Builders FirstSource:
Tell me business is deteriorating without telling me.

Last year BLDR was repaying their revolving credit facility, but this year they are drawing from it as cash flow is drying up. And this is *before* times get tougher for #homebuilders in recession.

[Eventually Consistent Capital @EventuallyCC]

@CoinCommoner @jfsrevg 🙃 You might get a fabulous BLDR entry opportunity in recession. Although there might not be any non-goodwill equity left then.
https://t.co/J4F5SrE2Hz

[Eventually Consistent Capital @EventuallyCC]

I'm watching for $BLDR Builders FirstSource to have zero stockholders' equity, excluding the $3.5B of goodwill they engorged in the boom.

BLDR loves to brag about their "fortress balance sheet."

[Eventually Consistent Capital @EventuallyCC]

@jfsrevg Or: run for za hills
https://t.co/x1rvpzsJuG

[Eventually Consistent Capital @EventuallyCC]

$BLDR Builders FirstSource:
Tell me business is deteriorating without telling me.

Last year BLDR was repaying their revolving credit facility, but this year they are drawing from it as cash flow is drying up. And this is *before* times get tougher for #homebuilders in recession.

[Eventually Consistent Capital @EventuallyCC]

@DurableCreators @marc_slans OTIS carries its own risk
https://t.co/gBHoTji6sR

[Eventually Consistent Capital @EventuallyCC]

Negative-equity $OTIS announces refinancing $500M 0% notes w/ $750M 5%.

Otis would rather carry debt and pay all profits via divs & buybacks. As long as profits hold up this is fine, but w/o profits the book is less than worthless, & even a decline would lift the already-high PE

[Eventually Consistent Capital @EventuallyCC]

@The_DivInvestor Customers safe: yes. Investors? It's getting riskier.
https://t.co/gBHoTji6sR

[Eventually Consistent Capital @EventuallyCC]

Negative-equity $OTIS announces refinancing $500M 0% notes w/ $750M 5%.

Otis would rather carry debt and pay all profits via divs & buybacks. As long as profits hold up this is fine, but w/o profits the book is less than worthless, & even a decline would lift the already-high PE

[Eventually Consistent Capital @EventuallyCC]

$OTIS manufactured elevators & escalators, before becoming a buyback-machine. 🙃

Perhaps management & investors should consider a *slightly* more cautious approach in a possible commercial real estate hard-landing.
https://t.co/6iuCmaiULh

[Eventually Consistent Capital @EventuallyCC]

Negative-equity $OTIS announces refinancing $500M 0% notes w/ $750M 5%.

Otis would rather carry debt and pay all profits via divs & buybacks. As long as profits hold up this is fine, but w/o profits the book is less than worthless, & even a decline would lift the already-high PE

[Eventually Consistent Capital @EventuallyCC]

I wonder how well $OTIS service revenue holds up in recession, one in which commercial real estate is hit hard.

I also wonder when long-option sellers will stop using Black–Scholes to (mis)price their wares.

Mkt Mkr: "If OTIS trades 9x P:E by Jan-2025, I'll pay you 18x prem."🤔

[Eventually Consistent Capital @EventuallyCC]

@nealemahoney @WallStCynic Ruh-roh DoorDash.
https://t.co/w7kjaXqWKb

[Eventually Consistent Capital @EventuallyCC]

"Breaking a delivery habit is an easy way for budget-conscious consumers to cut back on restaurant spending"

" $UBER and $DASH haven't reported the same weakness in their food delivery sales." --Yet 😈

"Only Grubhub reported shrinking order vol in N Amer for 1st half of the yr"

[Eventually Consistent Capital @EventuallyCC]

@CNBC Ruh-roh DoorDash.
https://t.co/w7kjaXqWKb

[Eventually Consistent Capital @EventuallyCC]

"Breaking a delivery habit is an easy way for budget-conscious consumers to cut back on restaurant spending"

" $UBER and $DASH haven't reported the same weakness in their food delivery sales." --Yet 😈

"Only Grubhub reported shrinking order vol in N Amer for 1st half of the yr"