REPORT #1
Gentlemen:
This Report is for the Trading day beginning Wednesday, July 27, XXXX, through Tuesday, August 2, XXXX (the Report Period). As a general pattern for the Period, we see a lot of retail buying and institutional selling. We also see the recovery of loaned shares into the index holders. I do not have any explanation for the surge in retail interest, as I am unaware of any press events or media shows that might normally correlate to such activity. I do know that the activity roughly correlates to the broader energy bill passing the congress which would also fit with the institutions were selling and retail was buying in that institutional holders are familiar with the particulars of the bill and retail investors are generally much less acquainted with the details.
The major liquidity for the Period was provided more than 50% by XXXXXXXXXX taking shares in then sending them out again. I would also point out that in a week or two we will get our first run of 13F reports for which we have data, which should illuminate things quite a bit. As you know we expect XXXXXXXXXX and Morgans, a XXXXXXXXXX client, to both be down substantially. We would also expect a bunch on new positions between 100, and 500 thousand shares representing the various hedging entities that were on the other side of the XXXXXXXXXX disposition. Most of these hedge positions we would expect to be transitory and will zero out within 6 months.
To talk about the retail activity of late, all majors held a positive balance and Schwab actually bought about 100,000 shares but only reports gaining 30,000 because what appears to be single holder sent 69,000 shares to a type one-retirement account. That is a large individual position. This type of activity indicates that the core of your diversified support are those people and institutions that think the sector will outperform going forward for macro reasons and they judge XXXXXXXXXX to be the best vehicle in the sector. As a matter of best practice, it would be good to point out that temporary fluctuations notwithstanding, over time the market for alternative energy should materially increase as fossil fuel supplies become increasingly allocated. Speaking of temporary setbacks, however, the energy bill just passed had something in it for everyone except anyone who could actually reduce our dependence on fossil fuels. I suppose this explains the institutional tepidness as it indicates a delay in adoption as the tax and corporate welfare structure favor inefficient uses of fossil fuels until at least 2009.
For the Period the largest (>= 40,000 share) changes in position were:
MGN (Wellington core), (580,559) shares;
PNC (Dimensional retrieving loaned shares), 251,900 shares;
CSFB (Institutional clearing position), (124,261) shares;
Brown (Merrill Lynch managed), (123,234) shares;
Citi (Vanguard), (104,920) shares;
BkOne (Retirement shares from Schwab), 69,025 shares;
Scottrade (Retail accounts), 63,279 shares;
BGI (Barclay's index reclamations), 49,348 shares;
E-trade (Retail accounts), 49,157 shares;
BkAm (Bank of America Capital), 46,616 shares;
BNY (Fidelity core), 46,000 shares;
NFS (Bank managed shares), (43,510) shares;
Merrill (Merrill Lynch Retail accounts), 42,230 shares.
This Report is for the Trading day beginning Wednesday, July 27, XXXX, through Tuesday, August 2, XXXX (the Report Period). As a general pattern for the Period, we see a lot of retail buying and institutional selling. We also see the recovery of loaned shares into the index holders. I do not have any explanation for the surge in retail interest, as I am unaware of any press events or media shows that might normally correlate to such activity. I do know that the activity roughly correlates to the broader energy bill passing the congress which would also fit with the institutions were selling and retail was buying in that institutional holders are familiar with the particulars of the bill and retail investors are generally much less acquainted with the details.
The major liquidity for the Period was provided more than 50% by XXXXXXXXXX taking shares in then sending them out again. I would also point out that in a week or two we will get our first run of 13F reports for which we have data, which should illuminate things quite a bit. As you know we expect XXXXXXXXXX and Morgans, a XXXXXXXXXX client, to both be down substantially. We would also expect a bunch on new positions between 100, and 500 thousand shares representing the various hedging entities that were on the other side of the XXXXXXXXXX disposition. Most of these hedge positions we would expect to be transitory and will zero out within 6 months.
To talk about the retail activity of late, all majors held a positive balance and Schwab actually bought about 100,000 shares but only reports gaining 30,000 because what appears to be single holder sent 69,000 shares to a type one-retirement account. That is a large individual position. This type of activity indicates that the core of your diversified support are those people and institutions that think the sector will outperform going forward for macro reasons and they judge XXXXXXXXXX to be the best vehicle in the sector. As a matter of best practice, it would be good to point out that temporary fluctuations notwithstanding, over time the market for alternative energy should materially increase as fossil fuel supplies become increasingly allocated. Speaking of temporary setbacks, however, the energy bill just passed had something in it for everyone except anyone who could actually reduce our dependence on fossil fuels. I suppose this explains the institutional tepidness as it indicates a delay in adoption as the tax and corporate welfare structure favor inefficient uses of fossil fuels until at least 2009.
For the Period the largest (>= 40,000 share) changes in position were:
MGN (Wellington core), (580,559) shares;
PNC (Dimensional retrieving loaned shares), 251,900 shares;
CSFB (Institutional clearing position), (124,261) shares;
Brown (Merrill Lynch managed), (123,234) shares;
Citi (Vanguard), (104,920) shares;
BkOne (Retirement shares from Schwab), 69,025 shares;
Scottrade (Retail accounts), 63,279 shares;
BGI (Barclay's index reclamations), 49,348 shares;
E-trade (Retail accounts), 49,157 shares;
BkAm (Bank of America Capital), 46,616 shares;
BNY (Fidelity core), 46,000 shares;
NFS (Bank managed shares), (43,510) shares;
Merrill (Merrill Lynch Retail accounts), 42,230 shares.
REPORT #2
Gentlemen:
This Report is for the trading days beginning Wednesday, August 10, XXXX, through Tuesday, August 16,XXXX (the Report Period). For the Period, we are seeing a continuation of the pattern from the prior Periods. Namely a continuing disposition out of Oppenheimer with the shares being picked up by the index and other large positions pursuant to their portfolio readjustments. The disposition out of Oppenheimer remains unidentified as of this writing. It appears to be a non-reporting entity, which would mean a hedge or boutique fund with less than 100mm in total assets. Judging from the price characteristics of the block I would say that the selling at less than $XX.XX is substantially finished. I would estimate at price between $XX.XX and $XX.XX they do not have that many shares left < 150,000. However, in conjunction with this slowing of sustained selling we should begin to see a slowing of the sustained buying as the large index positions like Barclay's and Dimensional are just about done being whipsawed by macro economic events.
I noticed from our review of the just released 10-Q that profits increased on equivalent to slightly decreasing revenues. This is consistent with the company concentrating on its core businesses. If the company can make the case to one or more new investor that the core profitability numbers will stay the same in terms of relative percentages of expense and profit and revenues should incrementally increase then I would say XXX,XXX to XXX,XXX shares of delivered buying would move the share price above $XX.XX perhaps above $XXX.XX
An administrative note on the 10-Q. I notice that the company does not reconcile net income to cash flow from operating activities in the interim reports. This has the effect of masking the loss of equity in affiliates and tax adjustments as most of the other items are estimable from the balance sheet and income statements. I am sure the question would arise to at least some investors why does the company follow this practice. The reporting practice makes it harder to model the cash flow, which adds uncertainty about the quality of earnings and the continued ability to pay a dividend, which all else being equal, would be expected to reduce index and other institutional participation in your stock. Just something, you may want to consider.
To conclude we will Email to you later this week a list of selected institutions, which we feel, will be favorably disposed toward an investment in XXXXXXX. It will be important to reinforce the quality of your earnings and your long-term dividend policy since the institutions referred are true value investors.
For the Period, the largest (>= 40,000 share) changes in position were:
OPP (Non-reporting at Oppenheimer), (224,475) shares;
BKON (Fortress), 215,692 shares;
BGI (Barclay's Global), 115,641 shares;
Merrill (Retail division), (127,680) shares;
SSBT (SSgA), (46,417) shares;
NTH (Northern Trust), (55,000) shares;
MLS (GAMCO), 334,565 shares;
PNC (Dimensional), 124,333 shares;
LEGG (Legg Mason retail), (463,740) shares; and,
Stifer (Stifel Nicholas), 213,731 shares.
This Report is for the trading days beginning Wednesday, August 10, XXXX, through Tuesday, August 16,XXXX (the Report Period). For the Period, we are seeing a continuation of the pattern from the prior Periods. Namely a continuing disposition out of Oppenheimer with the shares being picked up by the index and other large positions pursuant to their portfolio readjustments. The disposition out of Oppenheimer remains unidentified as of this writing. It appears to be a non-reporting entity, which would mean a hedge or boutique fund with less than 100mm in total assets. Judging from the price characteristics of the block I would say that the selling at less than $XX.XX is substantially finished. I would estimate at price between $XX.XX and $XX.XX they do not have that many shares left < 150,000. However, in conjunction with this slowing of sustained selling we should begin to see a slowing of the sustained buying as the large index positions like Barclay's and Dimensional are just about done being whipsawed by macro economic events.
I noticed from our review of the just released 10-Q that profits increased on equivalent to slightly decreasing revenues. This is consistent with the company concentrating on its core businesses. If the company can make the case to one or more new investor that the core profitability numbers will stay the same in terms of relative percentages of expense and profit and revenues should incrementally increase then I would say XXX,XXX to XXX,XXX shares of delivered buying would move the share price above $XX.XX perhaps above $XXX.XX
An administrative note on the 10-Q. I notice that the company does not reconcile net income to cash flow from operating activities in the interim reports. This has the effect of masking the loss of equity in affiliates and tax adjustments as most of the other items are estimable from the balance sheet and income statements. I am sure the question would arise to at least some investors why does the company follow this practice. The reporting practice makes it harder to model the cash flow, which adds uncertainty about the quality of earnings and the continued ability to pay a dividend, which all else being equal, would be expected to reduce index and other institutional participation in your stock. Just something, you may want to consider.
To conclude we will Email to you later this week a list of selected institutions, which we feel, will be favorably disposed toward an investment in XXXXXXX. It will be important to reinforce the quality of your earnings and your long-term dividend policy since the institutions referred are true value investors.
For the Period, the largest (>= 40,000 share) changes in position were:
OPP (Non-reporting at Oppenheimer), (224,475) shares;
BKON (Fortress), 215,692 shares;
BGI (Barclay's Global), 115,641 shares;
Merrill (Retail division), (127,680) shares;
SSBT (SSgA), (46,417) shares;
NTH (Northern Trust), (55,000) shares;
MLS (GAMCO), 334,565 shares;
PNC (Dimensional), 124,333 shares;
LEGG (Legg Mason retail), (463,740) shares; and,
Stifer (Stifel Nicholas), 213,731 shares.
REPORT #3
This Report is for the trading days beginning Wednesday, September 14, XXXX, through Tuesday, September 20, XXXX (the Report period). As you may recall last Period's activity was completely dominated by Morgan Stanley and affiliated entities accumulating shares in advance of the company's XXX announcement. This Period starts with said announcement and also includes the announcement of the Presentation at the XXXX conference but does not include the XXXX announcement.
For the current Period, the entities that acquired the shares last Period were laying them off this Period. Morgan Stanley, Morgan Stanley Security Services, (Knight Trading) and Citigroup (Sub Custodial for Morgan Stanley). Additionally it appears as if that were not enough some traders went 500,000 shares further short (half of which was covered by the end of the Period) in a trading pattern that successfully kept the shares under XXXXX. For the day of the announcement and the day following Morgan Stanley, originated, directed or covered delivery was approximately 750,000 shares (if one attributes the blatant short sales that day to MSCO) and approximately 280,000 shares respectively.
For some context:
I am at a loss as to how to punctuate this further other than to reiterate that it should be highly unusual for one entity to control the vast majority of the delivered accumulation immediately prior to an announcement and a majority of the delivered divestiture immediately after the announcement assuming that the fact of the announcement was not known in advance. The other thing that is curious is how the actual accumulation and divestiture activity was buried in huge reported trading volume for the two days concerned. If I were a suspicious type I would suggest that was done to obfuscate the observation that the majority activity was from the same origination.
As to other activity most index positions in the stock increased positions on the announcement, Primecap seems to have reclaimed a few shares, retail bought about as much as they are capable of and there were smaller supporting institutions as well. On the selling side, it is strictly limited to the aggressive trading and loaning houses. Almost no retail or institutional selling to speak of excluding Morgan Stanley and affiliated sub-custodial and trading entities.
For the Period the largest (>= 60,000 share) changes in position were:
MSCO (Margan Stanley & Company), (513,624) shares;
PNC (Dimensional Fund), 468,000 shares;
BGI (Barclay's Global), (259,601) shares;
BkAm (Primecap and others), 182,824 shares;
Schwab (Retail accounts), 171,242 shares;
Citi (Sub Custodial), (149,586) shares;
SSB&T (Royce & others), 129,236 shares;
TDW (Unknown out of what should be retail holdings), (129,053) shares;
JPMC (Fuller & others), 103,859 shares;
Scottrade (Retail accounts), 98,301 shares;
GLD (Trading position), (79,481) shares;
LHM (Lehman retail), 74,515 shares;
PRS (Retail & small managed), 67,479 shares;
FSTC (Bank managed accounts), (66,632) shares; and,
MSSC (Morgan Stanley trader), (64,500) shares.
For the current Period, the entities that acquired the shares last Period were laying them off this Period. Morgan Stanley, Morgan Stanley Security Services, (Knight Trading) and Citigroup (Sub Custodial for Morgan Stanley). Additionally it appears as if that were not enough some traders went 500,000 shares further short (half of which was covered by the end of the Period) in a trading pattern that successfully kept the shares under XXXXX. For the day of the announcement and the day following Morgan Stanley, originated, directed or covered delivery was approximately 750,000 shares (if one attributes the blatant short sales that day to MSCO) and approximately 280,000 shares respectively.
For some context:
I am at a loss as to how to punctuate this further other than to reiterate that it should be highly unusual for one entity to control the vast majority of the delivered accumulation immediately prior to an announcement and a majority of the delivered divestiture immediately after the announcement assuming that the fact of the announcement was not known in advance. The other thing that is curious is how the actual accumulation and divestiture activity was buried in huge reported trading volume for the two days concerned. If I were a suspicious type I would suggest that was done to obfuscate the observation that the majority activity was from the same origination.
As to other activity most index positions in the stock increased positions on the announcement, Primecap seems to have reclaimed a few shares, retail bought about as much as they are capable of and there were smaller supporting institutions as well. On the selling side, it is strictly limited to the aggressive trading and loaning houses. Almost no retail or institutional selling to speak of excluding Morgan Stanley and affiliated sub-custodial and trading entities.
For the Period the largest (>= 60,000 share) changes in position were:
MSCO (Margan Stanley & Company), (513,624) shares;
PNC (Dimensional Fund), 468,000 shares;
BGI (Barclay's Global), (259,601) shares;
BkAm (Primecap and others), 182,824 shares;
Schwab (Retail accounts), 171,242 shares;
Citi (Sub Custodial), (149,586) shares;
SSB&T (Royce & others), 129,236 shares;
TDW (Unknown out of what should be retail holdings), (129,053) shares;
JPMC (Fuller & others), 103,859 shares;
Scottrade (Retail accounts), 98,301 shares;
GLD (Trading position), (79,481) shares;
LHM (Lehman retail), 74,515 shares;
PRS (Retail & small managed), 67,479 shares;
FSTC (Bank managed accounts), (66,632) shares; and,
MSSC (Morgan Stanley trader), (64,500) shares.