Spekulatius

It’s entirely relevant to MSG, because the monthly cost so subscribe is similar and those costs have been creeping up significantly, so much that people who don’t care about this content or only care marginally started to notice and just cancel. The question is -can those losses be made up by targeting enthusiasts and charging those folks more? I am not sure, and if they can’t, it pretty much means, we have seen peak sport and finally some of the expenses related to Tv rights and player salaries will have to be scaled back. The other risk is that they may price younger folks out of the market, so they can’t afford to watch this and if they are not interested in a sport when they hit 20, they probably won’t care about it for the rest of their life. That would be a slow demographic shift, but it would be permanent, sort of what happens to baseball.

Boeing is basically an airplane system manufacturer and they will get a lot of components (engines, electronics, even the airframes) elsewhere. Liberty is correct, most of the progress is improving things over and over, not reinventing them. Tremendous progress with materials (composites, single crystal engine turbine blades, electronics have made flying cheaper, safer and more energy efficient. Only and idiot would say it’s all generic.

I like it enough and rebought some of my recently sold shares. It seems like the whole content/media sector has been weak (CBS, NFLX, DISCA) and FOX didn’t escape the wrath of Mr Market. Hard to tell what causes these share price oscillations. There was some concern about their purchases and then the stock bounced back, presumable because of a Murdoch insider buy. In the end, more noise than Signal and I disposition accordingly. I like FOX because I believe their have a franchise on news for conservatives and because their whole business around love content is Netflix resilient. their balance sheet looks way better than CBS/VIA or DISCA (which is worth consideration as well, because of the high FCF yield). somehow, FWONA dodged the bullet ... DISCA might be worth add'l consideration, though I'd want a better price before buying? First legs down appear around the same time, but NFLX might have decoupled from CBS/VIA/FOX... there is certainly some effect from sector/industry price correlation, but likely the CBS/Viacom deal is weighing on those stocks while FOXA is more a matter of uncertainty regarding capital allocation decisions?

Producing Wind turbines is a mediocre business at best. I looked at Vestas a while ago and didn’t see a reason to get exited.

Rebought some FOX Bought a starter in GTS, a crappy insurance business in Puerto Rico, trading at an even crappier price. Bought an even smaller starter in SPOT.

I like it enough and rebought some of my recently sold shares. It seems like the whole content/media sector has been weak (CBS, NFLX, DISCA) and FOX didn’t escape the wrath of Mr Market.

In my opinion, pension liabilities are way worse than debt. Essentially it is debt with a high coupon (the expected rate of return 7-8%) and a maturity of 30 years or so. Debt is easy and cheap now, pension are not. Pension liabilities actually get worse as interest rate go lower.

Great article. But unfortunately it won't change a thing. Companies will continue to cut corners. Investors will continue to invest. It’s where Uncle Sam would need to come in, start a criminal investigation into management and the engineering practices and threaten to get some arses thrown into jail for gross negligence and manslaughter. It probably won’t happen, these guys have very good lobbyists, but it’s about the only way these things would change for sure.

Pricing power is more limited the thought, as the recent quarter seems to indicate. Also, new entrants like Disney and Comcast seem to be pricing their streaming services low, so that will restrict pricing power even more. Of course they have international growth, but everywhere but the US, TV tends to be way cheaper, so I am not sure how much profit margin they can generate. Using Aswath Damodaran’s valuation spreadsheet, I need dramatic increases in ARPU to justify more than $200/ share in value. The stock seems way to expensive any way I look at this. Also, their Cash flow statement looks worse than their income statement because their capitalize their content cost, so they keep adding to their debt. FWIW, It’s not an great looking operating model, as far as balance sheet and cash flow statement are concerned.

AMZN is like weed, once it gets a foothold in a business, it’s going to be very tough to reign them in.

I wish I have gotten tequila shots every time people got fired in the company I worked for. I don’t think I would have been sober at work in late 2000 and 2001 at all. The more I think about it, so more I like the idea.

My question is what are they going to regulate? It seems like they will simply put an official label on what already exists. Correct me if I'm wrong but weren't the overwhelming majority of deaths caused by illegal products? What would the FDA even say? I can't picture them coming out and saying "vaping is safer than smoking." As that would simply drive sales and some people would take that as "this is kind of healthy". It really just seems like they want their federal tax money and that's it. Taxes and how they are being sold. I do know honk that vaping is safer than smoking, because it’s the byproducts of smoking that is causing lung disease and cancer, not the nicotine. I agree the death are caused by illegal products. What we don’t know is how profitable vaping is going to be, as new entrants have been taking market share (JUUL). I know that JUUL is 30% owned by MO (for a steep price), but 30% might not be enough to offset the market share losses, although it’s better than nothing. And then there is capital misallocation risk when you look at the purchase of their Cronos share for an insane price.

Why would he? If she can do deals that are too small for BRK, the gains won’t be material. If she were to compete with BRK he doesn’t have a reason to invest in her vehicle either.

I looked at Aswath Damodaran's SPOT valuation sheet from last year and decided to update it using this years numbers. One of the issues is that the growth extends further into the future, so I decided to reduce the growth rate from Y1-Y5 a bit from 25% into 22% (to account for the year that passed). FWIW, SPOT has grown >30% during the last 12 month. Surprisingly, I got a valuation that exceed the current market cap quite a bit - the value/share I got was $185 vs a current share price of $125. A few words of caution - I don't get how Aswath came up with a 21% gross margin last year, I put in a 25% gross margins for the premium subscriber part, which is actually lower than what SPOT achieved in Q2 2019 (26%). Most of the value is driven by the value of new subscribers that have yet to be acquired. I just took those from Aswath's model, minus my adjustment for the Y1-Y5 growth rate. The result is somewhat surprising, but maybe it isn't and just takes into account the 30% growth from last year, while the shares haven't moved. it seems that there might be a good value to be had. I also played with some numbers and found the valuation to cover the share prices as long as they can get a 13% growth rates for the next 5 years. I will attach the spreadsheet for those that are interested. SpotifyModelQ2-2019.xlsx

Cigarbutt’s posts are almost always very well thought out and useful.

Tracy monetizes her experience gained with Buffet . Nothing wrong with this, but no guarantee for success either. The problem with anyone starting out with a BRK copycat is if they can afford to be patient. There are plenty of holding companies with good capital allocators that can be bought at a discount to NAV.

I doubt that Vaping gets banned, but it will get regulated. We do not know what the economics of thr vaping or IAOS business going forward will look like. Tobacco has been a great business but never before has been a better substitute for Tobacco been around, so I think this time is different.

Regardless of why the repo rates increased dramatically and who was involved, in the end, it seems like several big boys in our financial system found themselves short on cash and with their pants down. I guess we all have seen this movie before. I personally think the Fed shouldn’t have stepped in, if if they borrow, they should have lend out at a high interest rate too. Perhaps this is related to the recent rebound in interest rates after a huge bull market in treasuries, but I am not sure.

So, what did Barr’s do wrong in your opinion? If she had bought back more GM shares as many here had been suggesting, GM would probably be junk rated already? I am not sure I get Moody’s rationale either, but I don’t get where Barra got it wrong.

I think Trump is far less likely to start a war than most presidents before him. I don’t think there is going to be strike on Iran, at least not on Tehran. Perhaps a surgical strike on some military assets, but nothing like a war. Perhaps the Saudis are going to do something , but most likely, they will just buy a Patriot system to defend against these threats and we would be happy to deliver, I think. The US is self supplied with crude (net) , so this is somebody else’s problem. Let them figure it out.

I'm rooting for Parsad, but it doesn't look pretty to me. I only scanned briefly, but don't see any evidence they are gaining traction. This is becoming a high risk VC fund :) High risk and high cost VC fund.

Because accountants / bookkeepers choose the software and there's high switching costs and customer (technical skills) lock in. There are also synergies with Intuits tax software. I think SQ could lock in merchants that are just starting out on SQ payment platform, if they offer book keeping capabilities on their software suite. I think SQ could end up running a Mickey Mouse ERP System for small companies/ merchants starting out. The stock is not cheap by any means (no position) but I like what the company is doing and started to track it.

A value buy it seems as you got in before the spike to $100/ bro that’s some doomsters predict. I think it will be more like $2-5$/brl and quickly reverse. I doubt there much supply impact from the drone attack. FWIW, so many oil heated homes on the East coast. It would be a great green energy plan to have them all connected to natural gas. Does this Gregmal guy ever get his timing wrong? He's on some epic streak! Tesla is probably going broke a few days after he bought some puts on the stock. FWIW, I bought some SPY 280 Dec 20 index puts for hedging yesterday.

I think the spike in crude will be relatively contained and short lived.Aramco is probably going to restore the destroyed facilities in a few weeks and the release from the strategic reserve will compensate for any short term restrictions. If we indeed go into a recession, crude prices will go down anyways.

$7-$8 is fairly expensive, imo. It was one reason for me to cut the cord and switch to streaming when I lived in the NYC area, since I paid for something I never watched. I don’t think I am the only one either.