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No. of Recommendations: 5
The Barron's article is scattered with "could" and "might." Tronox seems a highly cyclical business which is an "also ran" on a racing card where DuPont is the odds on favorite. Betting on this stock is, from where I stand, not that much different than going to the race track. There's nothing wrong with that; some people are very good at handicapping horses, but it's not for me.

Tronox has a solid balance sheet, with $2.4 billion in debt to $1.4 billion in cash. Free cash flow is healthy.

The above is a quote from the Barron's article. It's just simply wrong. Free cash flow is not healthy. It's negative.

I'm aware that the article reflects Barron's opinion, and not necessarily yours KitKat, but, after just a quick look at the books, I was taking issue with:

The best thing about them at present is a 5% yield. With manageable debt and positive cash flow this looks fairly safe.

Yes, technically they have positive cash flow, but technically, a ninety year old who uses a walker is "ambulatory." As for the dividend, unless a significant turnaround takes, or they leverage themselves to excess, the future for the dividend is murky. And as for "this looks fairly safe." It doesn't to me, but if people didn't see things differently, there couldn't be two sides to a trade :)

I, correctly I hope, imagine that when someone posts they are looking for feedback and the chance to see through someone else's eyes; from a different point of view.

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