Discover and read the best of Twitter Threads about #cyclical

Most recents (13)


1. Recently, we received new PMI data, which feeds into our PMI composite, whose readings continue to show a weak environment for growth assets (stocks, commodities, & high yield credit). As of the latest available data, our PMI composite now shows a reading of -10.93. Image
2. This was a sequential deceleration from one month prior and a decline in the three-month trend. PMIs are generally strong directional indicators of where we are in the profit cycle, as PMI respondents manage inventories and orders in response to their outlook on profitability.
3. PMI indicators are typically biased toward the manufacturing sector. While this does indeed make sense since production is largely driven by the manufacturing sector, it is important to also separate these sub-indexes to understand the pervasiveness of the current trend .
Read 10 tweets
Thought of the day: How many don't understand they own #cyclical equities? And the cycle peaked out in 2022 for 90% and contagion is the order of the day in 2023? #natgas #lumber #coal #oil #uranium #ironore #tin #nickel
#cyclical means you exit as the cycle matures .....that was 2022 if not 2021 for 80% of #commodities. Then 60% will experience a 55-75% fall in spot prices. Then one revisits in 2H 2023 or 2024 for reentry. If one holds through the cycle they don't understand what they own.
In short stupidity holds

#Natgas stocks post the $10 peak.....bottom < $2

#Coal stocks post the $450 plus ton peaks.....bottom < $130
Read 3 tweets
Thought of the day: When one is buying a #cyclical 20 bagger, generally the cashflow expansion over the holding period exceeds the purchase cap by multiple times. Hence its best to treat the exercise as a 5yr plus sitting period, as if it didn't trade for the interim period.
For $BTU the purchase cap was <$125m Vs peak operating cashflow > $1.5bn

For $IREN $70m Vs likely peak cashflow of > $250m
For $RIG < $400m Vs peak cashflow > $2bn
Read 3 tweets
Thought of the day: Return compounding is all about timeframes in #cyclicals, 10x over 5 years reinvested in 10x over 5 years reinvested in 10x over 5 years with 1-2 year waiting between reinvestment = 1000x over 17-19 years. Are you formulating your compounding plan?
Our working example:

$BTU from $1.21 = 13x < 30 months

deployed into:

$IREN from $1.32 = expect 10x over 48 months

deployed into:

Unknown at this time = 8x

Total return = >1000x
Documented is previous tweets
Read 15 tweets
Understanding balance sheet liquidity runways from cashflow cycle lows is key to selecting the multi baggers...

$BTU 80c to >$40 post buy backs & dividends kicking in >30x

$RIG 60c to >$15 >20x due to massive operating cashflow build up through 2026, debt duration push out etc
$BTU 2020 operating CF compared to 2023 > 15x

$RIG 2021 operating CF compared to 2026 > 6x
We purchased both at near cycle lows in 2H 2020.

We are replicating those themes in 2023 in:

#bitcoin miners

#preciousmetal stocks

Selected #cyclical low themes
Read 4 tweets
1- Checking in on the #Cyclical economy:

Inventories remain bloated and keep growing
2- So new orders continue to fall off a cliff

Chart from Richmond Fed survey - outlook 6 months from now
3- With less business, hiring and wage growth decline, latter from high levels
Read 5 tweets
$GMTN heading towards negative EV

1m oz resource at high grade with positive drilling results

65koz low capex production ramp up, NPV 10x cap and expanding

Optimization issues on start up

Accummulation zone incoming 8-18c, below <12c 10x return potential

It's starting to tick the boxes
A) negative EV
B) free pounds in the ground
C) low capex ramp up
D) nice grade
E) 10x plus NPV upside
F) hated by the market
G) optimization could kick in 3-6 months time
H) cycle bottoming incoming over 4-9 months
I) low dilution risk Vs M&A
Please note any new bottoming theme over the next 3 to 9 months, one should have 5 candidates to mitigate stock specific risk.

If our #gold watchlist falls by 50% from here as the bottoming process kicks in, the average return will likely be 10-15x over the following 3-5 years.
Read 7 tweets
Medium term investors buying the dip should act with serious caution, bear market dipping becomes a serious capital loss exercise. Understand the wider liquidity flow issues at play, avoid becoming the victim. Most inexperienced investors will struggle with the losses.

Decoupling from contagion takes time, the period of time will be shorter assuming the #uranium spot moves above $65 while equities price in $45 or longer if the spot contages lower as well.

50-70% down from recent 7 month highs continues to be a compelling accummulation zone
Fools buy the 15 dips in a bear market and self destruct 80% of their capital.
Those of us who built up 25-45% dry powder over the last 9 months have the resources to deploy into the next cycle bottoms that will multiply our capital by 10x plus.
Read 6 tweets
#cyclical businesses 🧵

A detailed thread on how to invest in cyclical businesses so that

- you don’t get trapped at the very peak and
- invest when the cycle is down for good gains in subsequent periods (1/n)
Look at a 10 yrs chart of a cyclical company

Same co., different outcomes for different investors

- 0 return for someone who invested at peak of 2010
- 80% loss who invested at the peak and sold in 2015-16
- 400-700% gain in 1-1.5 yrs who invested at lows of 2016, 2019-20 (2/n) Image
It's believed that cyclical companies are bad for investment

We too believe the same, until we realized that they are bad if picked up at the peak, but the same company can deliver great returns and in a relatively shorter duration if picked when the business cycle is down (3/n)
Read 12 tweets

8th edition.


Soulful music by none other than @VijayKedia1 before the AGM kicks off

check this one: @vijaykedia1 at his best
When will PPFAS will launch a new scheme?

Only if, PPFAS is excited about putting their own money & can add value to investors

Right now, there is no plan to cut any more expense ratio.

#NewFundoffer? nops
Read 63 tweets
Did the #Irish Central Bank provide sovereign guarantees to buyers of Irish Bank Bonds and other contractual debt liabilities classified as fixed income securities, before the #GFC struck?
I asked this question after watching Professor Kelly on YouTube.
He was describing how the #Irish Central Bank allowed banks to import capital in large sums, and later lend it out to housing finance borrowers.
That created a severe #ALM Mismatch, as homes are not liquid assets.
Only after the #GFC, did the Irish and other banks realize that a run on the #deposits could lead to financial #insolvency.
#Ruin #Risk by definition is the gap between Unexpected #Loss and Expected Loss.
As the gap increases, the chances of financial ruin and #default rises too!
Read 7 tweets
Do you believe #markets are #cyclical in nature?
Do you think #history #rhymes, if not #repeats?
Do you agree #greed and #fear are two main forces in the market?
If answer of above Q's is yes then following tweets will solidify ur view if its a no then they will change ur view.
Above is a monthly chart of #Sensex. It goes through an alternating #greedandfear cycle of 8 years. Sensex moves up in greed phase and consolidates in fear phase. It was up 469% in greed phase of 1992. was up only 20% from 1992 to 2000. From 2000 to 2008 it was up 271%.
In fear phase of 2008 to 2016 it was up only 48%. #Sensex has entered greed phase in 2016 and will stay there till 2024. So far its up more than 50%. But the story doesnt end there. The sectors which move up during these phases also go through a cycle.
Read 22 tweets
It would seem to be a mistake to not have taken peoples' very real, practical concerns more seriously…
This was the article which had been retweeted…
3/ Given extent, range, & specificity of research that has gone into making appeal so far it raises certain questions about how the local council justifies itself as operating for the greater good of all of its locality-while pumping publicity for...… …
Read 13 tweets

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