Spekulatius

Seems expensive. I got my front door replaced a couple of years ago for ~1.5k. This was for a larger door (~60” double door with glass). The door cost was ~1.1k ( Home Depot) and installation ~ $400. This was a couple of years ago when contractors were really hungry for jobs. I am hearing nowadays that people get outrageous quotes for all sorts of things. Home Depot also has an installation service, so it’s worth getting A quote from them. A door installation isn’t really a difficult job as long as the size doesn’t change, so even a good handyman might be able to do it.

So there is new episode in the SYTE soap opera: ”The Spaniard” Not sure what they are seeing here to take an ~8% ownership. The acquirer is a real estate company located in Spain. SYTE isn’t really a real estate company any more. Curious to see how this will work out.

He is definitely an out of the box thinker and he is a good investor. I hope he stops by here every once in a while. I feel we will hear more about him.

So ScottHall re-incarnated as LaforeverHall. Awesome tweet storm: https://twitter.com/laforeverhall/status/1205981236960714754?s=21

I can’t believe that an E&P investor suggests ignoring D&D. D&D is one of the most important metrics as cash flow - D&D ~ FCF. You can’t ignore it especially with shale plays, because the wells deplete so fast. Why one would think otherwise is beyond me. The high D&D is one of the reasons why recovery in bankruptcy cases for E&P is so lousy, despite what looks like low cash flow multiples to EV value. The wells deplete Somerset - after 2 years most of the oil and gas is done, that one needs to keep drilling to replenish. A building will ,last 50 years and even after that the land on it still will be there. Typically it’s written off after 20-30 years, plus there are escalators for rent which means economic depreciation is less than what’s reflected on the balance sheet. Mot so for oil and gas wells. The only way you can ignore D&D is if an E&P totally stops drilling and just harvests the wells and liquidates.

It looks like NGE pays an annual dividend ($0.76 this year), but the distribution date changed around, confusing some yield calculators. I beeline the real dividend yield is 5.7%. Regarding VISA - well that can’t be the issue since China requires VISA too and it doesn’t seem to hurt them. Many countries will require VISA for US citizen if the US requires VISA for their citizens to visit the US. The issues with Nigeria are known and I’d assume are priced it, the question is does it get better or does it get worse. I have no clue and haven’t acted upon the idea yet and put this on my watch list for the time being.

The data is for tracking RETAIL investor flows, and in general they are the worse investor of all classes. So, basically this chart means that retail investors made a big mistake, nothing else. What conclusions can we draw from this? It’s not clear to me that anything is relevant for investment decisions.

Hopefully the new CEO won’t do write downs, like many new CEOs like to do. Yeah, or set the future bar low, so he can easily jump over it. FWIW, I don’t like banks right now - potential for lower NIM and higher loan losses.

How can a market go up when money flows out? This does t make any. sense. Sure there are buybacks, mergers and equity swap for debt, but those are long term trends. It would posit that Markets can go up, if money flows in.

The best illustration of the failure of the US health care system I have seen: https://www.healthcostinstitute.org/blog/entry/international-comparisons-of-health-care-prices-2017-ifhp-survey

Also sold my small position in HHC today. I also reduced my CUERVO.MX by 15% after a good run.

Printing $402 now, more than a double from the mid year lows. Shorting is hard. Puts are outrageously expensive. No way I am playing.

Oddlots - “How online dating is reshaping the economy” is a fantastic episode, imo: https://podcasts.apple.com/us/podcast/odd-lots/id1056200096?i=1000459731481

They don’t have any edge so serving renewable, in fact I would say they are at a disadvantage, because their cost of capital is going to be higher than for an investment grade company like ENB for example.

Somewhat similar but I would argue MMM is a more reliable business. Looking over 5-10 years I see MMM has more stable revenue change rates, and changes in gross, operating and net margins, greater and more stable reduction in share counts over those years. I will give Dupont credit for managing their credit (:)) profile although perhaps the argument can be made that MMM should be levering up their balance sheet given their stable business and rate climate. Looking back 5-10 years doesn‘t really make sense for DD , since so much has changed since they merger with DOW Chemical and split the company three ways. DD results are messy at this point, donut doesn’t screen well. Hopefully, in a few years , the company will look much better. DuPont really was one of the worst managed companies in the industry since the 1990‘s and maybe back further.

DD is somewhat similar to MMM, but cheaper, imo.

I think we established in another exchange that anecdotal observations probably not going to help others companies that huge, as the differences are too large even for regions that are close to each other. I think a lot of the perceptions depend on how well your local hub operates. As for the stock I was buying FDX during the decline in late 2018, assuming that this was just somewhat cyclical, with some operational issues thrown in, that would be resolved over time. I sold during the moderate bounce after I felt that the issues run way deeper than I thought and that managements hasn’t fully fessed up. Since then, we had several management changes, TNT is still not performing and they are going to war with their biggest customer (Amazon) who I think will become a competitor. Even worse, I think the founder is pretty dilution all about the real issues, as he rants about USPS and thinks new planes are going to solve the cost issue in a couple of years. The company also hasn’t really generated FCF for years as Capex and pensions ate it all, which is fine when the business is growing fast, but lately growth has trailed off and Capex hasn’t. Now this is a business that operates as a platform with high fixed cost and as the revenue declines (as it has in the last quartet) I think they could get quickly in a situation where they are going to lose money. I am not in the camp that Amazon is going to win every battle they get into, but I am pretty sure that they are going to be major force in logistics and shouldn’t taken way more serious than USPS. Anyways, I am not an expert in this, I just try to stay away from trouble and owning FDX stock is more trouble than it am willing to accept. Being what it is, I think the stock is overvalued at $150 (the pre market price).

FDX is screwed imo, especially if you consider the bigger picture with AMZN: http://investors.fedex.com/news-and-events/investor-news/news-release-details/2019/FedEx-Corp-Reports-Second-Quarter-Results/default.aspx

Issuing stock ain't a bad thing if the stock is overvalued here. Jim McLaughlin is pushing 70, so it is understandable that he retired. I agree that issuing stock when it is overvalued makes sense. I guess the knock on BOMN is that they try to benefit from the Berkshire aura. The guys running it seem to be competent and their incentives are reasonably well aligned with shareholders. I don’t own this because I think the stock is overvalued and I don’t think the billboard business is that great of a nucleus for a company to get started. They have an embryonic surety business, up that will take years to grow into a meaningful size.

5:0 (FTC vote against the merger ) is a pretty clear score in a soccer match and this is no different here. I don’t think this merger is going to happen. PACB’s board need’s plan B and that means a merger with another partner, even if they pay less.

Reading the merger presentation on DD’s IR website, it seems like the main benefit of this transactions are 1) somewhat levered recap - DD remainco gets $7B 2) they merge with IFF which currently has a ~16x EBITDA valuation 3) $300-400M in merger synergies and creating the largest company in their niche Seems alright when the implied valuation of the company is ~11x EBITDA. I think it is correct that some of the remainco business lines could well end up being merged as well. It looks more and more like Tyco 2.0 to me.

Sometimes you get the dips, sometimes you don’t. I personally have target prices as well, but you have a downside that your inherently murky valuation undervalues the stock in question and you never get to buy it. If your time span is truly a decade, a 16% difference isn’t that much. My own timespan is more like 3-5 years and in that case 16% matters.

The biggest competition for Liberty isn’t BT, it’s probably Sky, now owned by Comcast. They are using a hybrid network (self build and last leg from BT). This approach works well where the government mandated that the incumbent has to rent out their network to competitors. Sky is now starting the same thing in Italy (presumable using Telecom Italia’s network for the last mile. I can see Comcast eventually making a bid for some Liberty subs. They clearly have ambitions in Europe.

Most people just stayed away from stocks like GME. The issues with GME were apparent a long time ago: https://www.siliconinvestor.com/readmsg.aspx?msgid=26866701&srchtxt=GME

Note that DD conveniently guided earnings down a bit from ~$3.95 to ~$3.8/ share. This will keep a lid on DD stock to some extend.