giofranchi

I guess simply by getting 4-7% in most of their products, and 11-12% in aesthetics, and 10-13% in emerging markets. Listen, you and I simply don’t know the so called Val-gan business as well as Mr. Pearson… Would you argue with that? I hope not. Therefore, is Mr. Pearson a reliable manager? I mean: does he usually under-promise and over-deliver? My answer is: Yes! Yours, instead, might be: No! Any answer you give to that question, I would keep it as simple as that! ;) Gio

All's Well That Ends Well ;D ;D ;D Cheers, Gio

Thank you very much, OracleofCarolina! :) Gio

I agree… at least in theory… in practice I am very bad at verifying this kind of things… and don’t know many people who are good at it… of course, I will now read Wikipedia (thank you!)… I just don’t think it will make much better at it… That’s why I invest in 10 companies: if I get burnt with just two or three of them, I might do very fine nonetheless! I think this is the best way of verifying I have come up with until now... ;) Gio

I do not even know what the dutch auction offer actually is… ::) I don’t understand what you are worried about: that JAH might be a fraud? Listen, management here has a predictable business, which is not capital intensive: that is what I look for in a business. Because it puts free cash in management’s hands on a regular basis and safely enough. If then management is good at deploying that free cash, management and shareholders will become rich. On the other hand, a fraud in the end makes everyone poor. Therefore, why should management be cheating? Only if the business is not a reliable free cash generator and/or if management’s capital allocating skills are poor. That’s for each of us to judge. Me, I like consumer products, and I like Mr. Franklin. :) Gio

Liberty, sorry I hadn’t read your post until now… The short thesis for JAH is almost exactly the short thesis for VRX: if you can answer short sellers’ arguments against VRX, you should also be able to answer their arguments against JAH. In fact, I think there are many similarities between VRX and JAH. :) Gio

bmichaud, if you look at VRX New Release for its 2013 year end Results, you find on Table 5 (5.2) how Adjusted cash flow from operations (Non-GAAP) is calculated. While on Table 2 you find the Reconciliation of GAAP EPS to Cash EPS. http://ir.valeant.com/investor-relations/news-releases/news-release-details/2014/Valeant-Pharmaceuticals-Reports-Fourth-Quarter-And-Full-Year-2013-Financial-Results/default.aspx Hope this helps. :) Gio

--Mr. Andrew W. Mellon Gio

+1 Much appreciated! :) Gio

Hi original mungerville, Have I ever used the word “always”?! If so, I was clearly mistaken… probably because, while writing, I was actually thinking about something else!! ;D I believe in opportunistic behavior (only in business, mind you, not at all in personal relationships!), and the word “always” has (almost ;)) no place in my business vocabulary! Gio

biaggio, very nice to see you on this thread again! As wellmont (and me too, I think… but I don’t want to sound too presumptuous here!) has repeatedly said, there are many ways VRX can create shareholders value, besides growing bigger and bigger. Just look at LMCA! To me, partnering with Mr. Pearson today is much like having partnered with Mr. Malone 20 years ago… Isn’t this enough? ;) Cheers, Gio

Just to be clear: I cannot know if you, or anyone else for that matter!, believe in leaving some room to average down… I guess it is just a way of doing business that fits my personality. Actually, right now the only full position I have in my firm’s portfolio is FFH. Some days ago I had two full positions: FFH and LRE. Therefore, you see, the fact I have not yet a full position in VRX might mean nothing at all! ;) Gio

Hi ItsAValueTrap! Have you read my comment on the VRX thread? Should it really be “all, or nothing at all!”?! Is it wise to invest that way? If you like LMCA more than ALS right now, well then sell some ALS and add to your LMCA position… I can understand that! But to get out of ALS completely?! Why? I don’t understand… ??? Gio

I think it will turn out to be a very satisfactory investment for many years ahead. In between VRX and ENDP I am almost at 10%. But I want to leave some room to average down, as I am doing with ALS too. I am not worried at all about their debt load. But I am aware of the fact that, if a correction comes, the stock price of indebted companies will decline the most. Just like ALS stock price will decline a lot, if a correction in the price of iron ore comes. That’s why I am almost at 10% in VRX + ENDP, and a bit more than 10% in ALS, which are not full positions yet. Gio

Wow! That’s a huge vote of confidence! :) Fairfax remains my largest investment by far… ;) Gio

Imo the quality of ENDP’s conference calls is on par with VRX’s. Therefore, I am invested in ENDP too. And I would suggest to dig deep (I mean to print its last three conference calls and read them, nothing more!) into ENDP as well. :) Cheers, Gio

I think it's the opposite. They've been doing most acquisitions mostly with debt, they could easily have issued more stock, and Ackman wanted VRX to put more equity in this deal but VRX wanted to use more debt (and Ackman has elected to take 100% shares if he can get them, so he also thinks it's quite cheap). The current deal is a compromise. They've bought back a fair amount of stock a few years ago, and the stock price increase since then tracks the operational growth fairly closely (not exactly). If the company can keep executing anywhere close to what they've been doing, and I have no reason to think they can't, the stock isn't overvalued at all. vrx is way undervalued if these two combine. it's undervalued as a standalone. I agree with wellmont on VRX, therefore I invest in VRX. I agree with ItsAValueTrap on LMCA, therefore I invest in LMCA. I agree with Dazel on ALS, therefore I invest in ALS. Instead, I don’t agree it should be either VRX, or LMCA, or ALS… Why?! Here we have three undervalued jewels… why should I be satisfied of owning just one jewel, when I can have three?! ::) Gio

I agree. Anyway, 1 year and a half ago CBRL was an undervalued stock, and the healthy rise in price is testimony to that. But today CBRL is no longer undervalued, and from now on to be a good investment it must create value. To create value, Mr. Biglari proposals make sense; CBRL’s management on the other hand is completely unconvincing… Now, a shareholder should always think about the future, and not be content with the past, just because the recent past has delivered solid results. ;) Gio

This is very interesting! And I tend to agree. :) Thank you, Gio

I agree this might not move the needle much… Anyhow, it is the strategy and the process that I like! :) Gio

+1 (unfortunately) Gio

Maybe not… But shareholders lulled into autopilot thinking by a rising stock price are very common… too much so!! Btw, what flaws do you find in Mr. Biglari’s proposals for CBRL? It basically is the same recipe he used to turn around Steak’n Shake… And it worked quite well! ;) Gio

I have just bought it! Thank you! ;) Gio

The process of acquiring insurance platforms opportunistically goes on. :) Cheers, Gio PRFFH_April_24_2014_Fairfax_to_Acquire_Indonesian_Insurer.pdf

http://www.endo.com/news-events/press-releases Gio