Coronavirus Starts to Hit Tech Hardware Stocks

By Dan AmossPosted February 19, 2020

With the news that Apple Inc. has cut its revenue guidance due to the coronavirus outbreak, other tech hardware companies will suffer from both its supply chain and from lower demand for hard drives within China. This includes our latest play on Seagate Technology that has suffered unrelenting revenue declines in the past several years.

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Jim Rickards’ Crash Speculator

Dan Amoss

Dan Amoss, CFA, tracks aggressive accounting and other red flags that markets miss. He’s a student of the Austrian School of economics and Daily Reckoning fan since 2000. Agora Financial relies on Dan for macro market commentary as well as profitable plays like his 2008 call to readers to buy Lehman Bros. puts, which...

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Royal Caribbean Cruises To Dilution

By Dan AmossPosted October 14, 2020

With changing consumer behavior due to the pandemic, the travel and leisure industry is suffering due to cash burn and weak balance sheets. This includes cruise ship operators like Royal Caribbean. Like so many cyclical travel companies and airlines, RCL shareholders are suffering significant dilution of their stakes in the company

Airlines Need Much More Capital

By Dan AmossPosted April 29, 2020

One sector of the market suffering heavy losses is the airline industry. When taxpayer-funded payroll assistance ends, airlines must tap new sources of capital from the private sector. The longer that demand for airline travel remains far below its peak, the more cash airlines will burn and the more capital it will need. The result will be a heavy cost to shareholders.

We Are Entering Corporate Triage

By Dan AmossPosted March 18, 2020

Today, many businesses face a shutdown of indefinite duration and an uncertain recovery afterward. These consumer-facing businesses are not designed or prepared for something like a coronavirus pandemic. Most operate on tight profit margins, have heavy capital requirements and are burdened with large debts. Dealing with how to help companies, you can think of corporate triage as policymakers deciding which companies get rescued and how they might get rescued.

Wynn’s Tornado of Adverse Events Continues

By Dan AmossPosted September 2, 2020

Shares of casino owner Wynn Resorts Ltd., our latest short idea, continue to lag the market for very good reasons. Wynn faces a triple tornado of adverse events. These include the pandemic, the resulting economic depression and trouble for their Macau location. A rebound will surely arrive, but how large it will be is unclear. As revenues decline and debt load rises, these headwinds will continue to put downward pressure on its stock price.

American Airlines Is a Recession Away From Bankruptcy

By Dan AmossPosted July 10, 2019

Airline stocks appear to be morphing from solid investments into value traps. In particular, American Airline bulls assume the business is not as cyclical as it used to be, thanks to a more consolidated industry. But we already have plenty of evidence that the airline profit cycle is a few years past its peak and a recession will push American into financial distress.

Fun and Games with EBITDA

By Dan AmossPosted September 30, 2020

When credit markets seized up during the February-March market panic, CVNA shares crashed due to its inability to produce used car loans at a sustainable level. In a very capital-intensive business, having enough cash flow is key. Using one accounting metric in a misleading way is necessary to constantly reinforce a narrative of unlimited demand for cars to maintain excitement in the stock.