Zeev's Turnips Patch-No Politics (ZEEV)

[ayahuasca]

Hi Zeev,

I've been out of town since late Tuesday and just getting caught up now. Regarding IPII, I think your concern is valid, and likely an opinion others share. I only have a small position here (thankfully I sold 1/2 before earnings), but I think a counter-argument to that is this-
The release of government money for rebuilding efforts from last year's storms has been slow and has only recently started in earnest. That cash flow will take a little longer to reach IPII because they supply materials to the contractors. Two of the main materials that IPII supplies- roof tile mortar and gypsum wallboard- should be among the main materials needed in rebuilding. Further, it is my understanding that IPII was having difficulties obtaining gypsum for their wallboards, and paying premium prices for it due to the strength of the housing market. Now that this market has cooled the availability/price of gypsum should no longer be a problem.
Overall I think the increased work from the rebuilding efforts, which are likely to continue for quite a while, should more than make up for the decrease in materials supplied for new home building and in fact will be marginally helped by the cooling of that market.
With all that said, I am likely to extricate my remaining position on the next significant run which I hope will occur when the next (and first) storm begins to approach that region.
Based on the numbers I prefer HSOA in this general arena.