giofranchi

Well, I guess you cannot possibly buy every single bargain out there... Anyway, great job again! Cheers, Gio

As you have told me: "Good if I am right, and I can afford it if I am wrong". Cheers, Gio

As I have said, it is extremely difficult imo to get right how fast and how long FB could keep growing. Who really knows? Maybe, also FB will develope other businesses besides its core advertising business, like GOOG and AMZN are doing... Who says FB will remain only an advertising company? It surely has the wherewithal to expand in other areas as well. If you cannot predict how fast and how long FB could keep growing, its FV must remain very uncertain. Maybe you are right, and the market is too optimistic right now... or maybe the market is ignoring future opportunities... given this uncertainty, FB remains a small position for me. Cheers, Gio

All very true. On the other hand AMZN already has a formidable competitor on a global scale: Alibaba of course. And I guess it could be said the same reasons that make AMZN difficult to dislodge in the west also make BABA difficult to dislodge in the east. Instead, at least for now, there is nothing that even gets close to FB's 1,892 million active users, which keep increasing at the pace of 10 per second! Cheers, Gio

Thank you, John! The following quote from Larry Page summerizes quite well how I feel about this endeavour: And I will surely keep you updated on how it is going. Cheers, Gio

This is my experience: the business I own and manage has always been a local business, but I have often thought that its services could be of great interest for architects and engineers working in other nations as well. To advertise them in those nations though would have been an effort both incredibly costly and time consuming. Therefore, I have never tried to expand my business outside Italy. Now thanks to FB that’s exactly what I am trying to do, and already with some tangible results. Obviously the jury is still out: this experiment could still fail in a miserable way… Anyway, just think about the possibilities that FB has opened up for me, and probably for many other small business owners around the world! I am willing to spend much more than I have ever spent in marketing to test those possibilities. Cheers, Gio

I guess the same could be said for AMZN and GOOG. And that’s why I keep each of them a small position (3.5% AMZN, 3.5% FB, and 5.5% GOOG). Taken as a whole they are a meaningful part of my portfolio, but I guess the risk all three will be dislodged by new competitors is small (at least for the foreseeable future). Cheers, Gio

I don't think many people know how to value FB: I certainly don't! Malone called its business model the best in the world and here is a tweet I received yesterday by Jeff Stibel, author of "Breakpoint": The best business model on a truly global scale and a leader at the helm who is making all the right moves. Imo very few people are estimating its rate of future growth correctly, nor for how long FB will be able to sustain it: 5 years ago a brain scientist and network expert like Jeff Stibel already was predicting that FB would become "wiser", but smaller... I have a small position in case the market is still underestimating how fast and how long FB could keep growing. Cheers, Gio

Why Facebook Keeps Beating Every Rival: It’s the Network, of Course https://www.nytimes.com/2017/04/19/technology/facebook-snapchat-instagram-innovation.html?_r=0 Cheers, Gio

I see, Sanjeev. On the other hand, on a P/S basis AMZN looks attractively priced, given its rate of revenue growth. And according to Morningstar AMZN is undervalued (though not cheap) today. I have bought some just in case it keeps growing revenue and succeeds in gradually expanding margins too. Cheers, Gio

Sold ACGL and used the proceeds to buy AMZN. ACGL was a small position AMZN is a small position. Cheers, Gio

I have opened a small position in GOOG yesterday. I think the recent small correction represents an opportunity to open a starter position in a great company that might still go on growing for a very long time. If the correction in price goes on, I'll be glad to buy more. eMarketer expects the online advertising market to grow at a CAGR of 14.5% for the next 4 years. And GOOG might be able to improve its share of that market from the current 41% to 50% more or less. In my own businesses online advertising is practically the only kind of marketing we do. And we are planning to spend more and more every year in online advertising. Cheers, Gio

Well, then I don't understand your own comment. If you already believed that among 180k people it might be hard to find a worthy successor, why making the comment? And although it might be hard, it surely is possible: that's why one more year could be useful and enough. Cheers, Gio

Maybe, no WORTHY successor... Cheers, Gio

Does anyone have a SOTP analysis of LVNTA? I have an hard time finding out what its NAV might be today. Thank you! Cheers, Gio

Sanjeev, believe me that I have enjoyed very much the couple of dinners I had the chance to attend! It simply is not easy for me to come every year from Milan... If it were easier and less time consuming, I would surely attend every single year. If it is of any help, I can buy the ticket even if I won't be able to be with you this year. Please, let me know. Cheers, Gio

My main takeaways: https://twitter.com/giovfranchi/status/844222400447307779 https://twitter.com/giovfranchi/status/844475949714460672 Cheers, Gio

Exclusive: Disney Iger on movies, parks, ESPN https://www.google.it/amp/www.barrons.com/amp/articles/exclusive-disneys-iger-on-movies-parks-espn-1489744355 Cheers, Gio

My downside protection is the meaningful fcf the businesses I privately own and manage generate at the end of each month. And I don't know of any other kind of downside protection that really works. Cheers, Gio

I've been thinking a lot about Starbucks and I think there are worse ideas than buying this and holding on. I generally think this will do very well over time, but here's sort of a loose outline of what I think: People really like their coffee. You don't, I don't, but millions buy it every day. I like that people make small, nearly automatic transactions everyday. The cost of each coffee, in dollar terms, not relative to other coffee, is low and I doubt too many people pay attention to the price of a single coffee, let alone their run rate costs. I think this is the type of thing that they win a customer at a young age and have them for decades as habits and preferences take root Coffee is mildly addictive with little health risks and low potential for future concerns of adverse effects. There has been a demonstrated ability to raise prices The company is currently quite profitable. I like the management. I think they have shown persistence and strategic focus (e.g. multiple attempts to enter the tea market, multiple attempts to enter higher end coffee shops.) I think they have a good chance of entering and, frankly, dominating the higher end coffee market over time. I like their capital management. I like their returns on capital I think they can continue to grow in Asia and in the US Little to no technological risk Demonstrated ability to scale without brand dilution If you take a look at the competitors in the space, the one I'd worry most about is JAB b/c I don't fully understand their strategy. They have a lot of good brands, but it's going to be hard for them to compete with SBUX outside the CPG space. Dunkin is a regional brand and MCD promise as a brand isn't good coffee, and as such, they aren't a strong competitor (though it is worth their while to try). Third-wave coffee shops are largely small chains and independents, and Starbucks is well finance and has substantial real estate expertise, which can make them a formidable competitor (I don't know about you, but most indy coffee shops are shit, though I would recommend la Colombe if you come across it). The multiple's high but I can't think of anything else that's wrong with the company, and the multiple is only a major concern if there is a risk to the company's perception as a going concern. This isn't like a retailer or fashion brand where purchases are large enough and infrequent enough to promote comparison shopping. Purchases are habitual. It's a high margin product with a low absolute cost and generally affluent customer base concentrated in urban areas. And they own their go to market and have an actual relationship with their customers. I think they get low, double digit EPS growth over the next decade, through a combination of store openings, price increases and share shrink, plus another 1.7% in current yield. Even if the multiple shrinks in half over that period, that's a mid-to high single digit return for what is essentially a consumer stable. Thank you for this analysis of SBUX. Very useful! Cheers, Gio

+1 Great quote! ;) Cheers, Gio

What Everybody Misinterprets About ESPN And Disney http://seekingalpha.com/article/4053103-everybody-misinterprets-espn-disney I agree of course that the market has changed, but it doesn't mean ESPN is dying. People will go on watching sports and loving them. ESPN surely must evolve: might multiple subscription-based streaming services, through which consumers can buy sports programs selectively based on personal preferences, be the right solution to its problems? Cheers, Gio

Thank you! Cheers, Gio

Thank you, Ross! I will look into it carefully. Ok. I like Apple, therefore I am not really worried about this new and very large investment. Of course I understand anyone has his/her own view about Apple! Mmm... I am still skeptical... If consumers want a treasure hunt, why cannot Amazon and/or Alibaba give them such an experience? Let's put it this way: 1) If TJX, IKEA, and Costco could go on giving their customers something they cannot find at Amazon and/or Alibaba, TJX, IKEA, and Costco will be fine. Also Amazon and Alibaba will be fine and will keep growing. 2) If TJX, IKEA, and Costco could NOT go on giving their customers something they cannot find at Amazon and/or Alibaba, TJX, IKEA, and Costco will start to shrink. Instead Amazon and Alibaba will be fine and will keep growing. Of course TJX's track record till now seems to prove that 1) is more likely than 2). But will it continue to be so in the future? I don't know the answer, and that's why I prefer to hold those cos which will be fine in both cases. Cheers, Gio

FAIRFAX TO MAKE STRATEGIC INVESTMENT IN ALTIUS http://altius.cmail19.com/t/ViewEmail/d/01CA5BE82B0C423E/2F9415254B7704C2C68C6A341B5D209E Cheers, Gio