Free Investing

Kenneth Hackel submits: Sounds crazy, no? Given that corporate Boards remaining relentless in cash maximization policies, alongside reluctance to spend without a confident payback period, the obvious outlet is stepped-up acquisitions. Given a strategic free cash flow-based acquisition, firms could put themselves in a position of stepping up their return on invested capital, given the very low cost of debt that might need to be raised to fund the purchase. A well-priced and timed acquisition can significantly add to shareholder value, while of course, an ill-priced, ill-executed and poor candidate would severely destroy value.Complete Story »

Steve Alexander submits:What a difference a year makes! In 2008, the S&P 500 had its worst year in the history of the index, plummeting nearly 40%. I said in the 2008 year in review that those that had the intestinal fortitude to hold equities through that bloodbath would be handsomely rewarded over the next few years. It turned out that it only took one year to see some nice gains. SPY, the S&P 500 ETF, appreciated over 26% in 2009.Right now, many equity analysts are fretting about the index being at historically high price-to-earnings multiples, but we must remember that those multiples are against depressed earnings in 2009. As the economy recovers, the earnings part of the multiple should rise, and prices should follow suit. MagicDiligence still believes there is upside in stock prices from current levels.Complete Story »

Market Folly submits:This is the third quarter 2009 edition of our hedge fund portfolio tracking series. If you're unfamiliar with tracking hedge fund movements or SEC filings, check out our series preface on hedge fund 13F filings.Next up in our series is Thomas Steyer's hedge fund firm Farallon Capital. Thomas Steyer founded Farallon in 1986 and today it is a multi-billion dollar hedge fund that typically uses risk arbitrage strategies and invests in equities, private investments, debt, and real estate. Previously, Steyer was an analyst for Morgan Stanley in its Mergers & Acquisitions department and also an associate on Goldman Sachs' risk arbitrage desk. Steyer graduated Summa Cum Laude from Yale University and also received his MBA from Stanford's Graduate School of Business. In the past, Farallon was ranked third in Alpha's 2008 hedge fund rankings. In terms of recent portfolio adjustments from Farallon, we saw it was just adding to its Beacon Roofing (BECN) stake. For more recent activity out of Farallon head to our post on its portfolio and internal firm adjustments.Complete Story »