He's a genius.
Silver if I only listened to you I would be making money just like all your investors.
From Deal Book:
Who says hedge funds can’t be warm and fuzzy? SAC Capital, the large and secretive investment pool run by Steven A. Cohen, made a regulatory filing Monday disclosing that the fund and its affiliates owned a 5 percent stake in Build-a-Bear Workshop, a publicly traded company that sells custom-made plush toys such as the “Taking Care of Business” bear, which comes complete with two-piece suit and black briefcase.
To be sure, SAC’s investment does not necessarily mean Mr. Cohen’s fund is feeling bullish about Build-a-Bear. The fund may have other, undisclosed positions, including short sales of the stock, which would gain value if the shares declined.
Though hedge funds can be pushy with the companies in which they invest, management at Build-a-Bear probably does not need to worry. SAC’s filing suggests that it is a passive investment and not an attempt to influence the company or acquire control.
Shares of Build-a-Bear were up 3 percent after SAC’s stake was disclosed on Monday, giving the company a market capitalization of nearly $600 million.
Build-a-Bear is just the latest consumer-focused investment in past few weeks for SAC Capital. On Dec. 29, the last trading day of 2006, it reported an 8.7 percent stake in Endeavour Acquisition, the shell company that agreed in December to buy American Apparel, a retailer that targets young urbanites with provocative advertising.
That same day, SAC Capital also reported owning a 5.6 percent stake in Pacific Sunwear of California, a seller of surfer- and skateboarder-style apparel.
From Deal Book:
Who says hedge funds can’t be warm and fuzzy? SAC Capital, the large and secretive investment pool run by Steven A. Cohen, made a regulatory filing Monday disclosing that the fund and its affiliates owned a 5 percent stake in Build-a-Bear Workshop, a publicly traded company that sells custom-made plush toys such as the “Taking Care of Business” bear, which comes complete with two-piece suit and black briefcase.
To be sure, SAC’s investment does not necessarily mean Mr. Cohen’s fund is feeling bullish about Build-a-Bear. The fund may have other, undisclosed positions, including short sales of the stock, which would gain value if the shares declined.
Though hedge funds can be pushy with the companies in which they invest, management at Build-a-Bear probably does not need to worry. SAC’s filing suggests that it is a passive investment and not an attempt to influence the company or acquire control.
Shares of Build-a-Bear were up 3 percent after SAC’s stake was disclosed on Monday, giving the company a market capitalization of nearly $600 million.
Build-a-Bear is just the latest consumer-focused investment in past few weeks for SAC Capital. On Dec. 29, the last trading day of 2006, it reported an 8.7 percent stake in Endeavour Acquisition, the shell company that agreed in December to buy American Apparel, a retailer that targets young urbanites with provocative advertising.
That same day, SAC Capital also reported owning a 5.6 percent stake in Pacific Sunwear of California, a seller of surfer- and skateboarder-style apparel.
posted by MattKelly54 at
8:12 PM
8 Comments:
Matt,
Its funny that you post this; I know the guys from SAC who have invested in BBW. The three of us were all in St. Louis meeting with the mgt. at their headquarters in early december. I initiated on the name at FMR on Xmas eve at $26. 12.5% later its at $29.25. SAC isn't short they are long and strong btw. Also, the company is going to announce a new boy targeted concept that will either be what is featured on www.racelinemotorworks.com or something similar as they have licensing partnerships with nascar and f-1. The concept is conservatively worth $10 / share. Most of us that are familiar with the story agree that the business as it is today is worth $40 alone. Add the new concept and its $50. 66% upside in most bullish scenario, 33% upside in base case. No growth value of the firm is $20. I have gotten our PMs to buy roughly 2% of the firm so far; catch it while you can.
Maybe I am ignorant, but how can someone be long 5% of the shares and not be long? Does anyone know the high power finance this reporter is talking about. I guess options?
Matt,
I suppose they could be short a convert or trading options where put/call parity is out of whack. That's about it.
Journalists are journalists. They don't have to understand the facts, just report them.
This guy is an idiot. He hears SAC and immediately thinks "Short". I view this guy as no different than all other journalists that cover finance - incompetent.
Silver,
Just curious how you arrive at those targets. I'm not saying you're right nor wrong (i've never looked at it); just curious: Multiples? DCF?
-Brent
What didn't you pay attention in Mello's Class?
The downside target is no growth perpetuity value, the upside is a mixture of multiples and a dcf (9x 07 EBITDA + Cash, 20x 07 EPS, and DCF using scenario analysis with WACCs ranging from 12% to 14% and terminal multiples from 6.5x to 9x.
And btw, I am right. So just buy the stock and trust me...like my URBN short and HD short last year. I feel very confident on this one.
Just curious, why did you add back the cash to the ev/ebitda?
btw, there's more ways to value a stock than what was taught in Mello's class ;)
haha, i know that there's more ways to value than that. I am just joking. Sum of the parts, net asset value, multiples, dcf, price per click (jk)...point is that i usually try to triangulate in valuation and get something similar from all different methods. I stripped out the cash originally and added it back.
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