Spekulatius

I enjoy watching this, but I hate people fronting their kids for questions.

Looks like the US is doing nicely and China as re-accelerating. Europe is still slow and I don’t know about Canada. Mr. Market simply seems to have overreacted back in December.

Top execs should be required to hold several years worth of annual compensation in company stock, just to make sure they are aligned with owners. It’s one thing I look at and consider when voting on compensation and I vote no a lot.

Imo, the market is story driven right now. I am keeping PINS on my watch list and I think there might be Chance to get this at a sensible valuation later on. I think that even Uber will come out of the gate strongly and my bet is that they will raise the IPO price a bit above $50. I am not interested in that one though.

Could you elaborate on your perception of the "Worst Case SAAR Scenario"? Thanks, I'm just trying to learn. Not a problem - SAAR means Seasonally Adjusted Annual Rate. If you check out Fiat's presentations, especially the investor day presentations, you will see them use it to explain what happens when a recession-like scenario happens, they will still make a profit. The problem is that during a recession, we typically have a) lower volume , b) less profitable models or trims and c) more discounting. The models typically only account for a)..

Your input is much appreciated. In any case, I like the cable side better and will invest Megacable going forward.

Well, he has to own at least one share in order to attend the shareholders meeting. At the current quote of $135 it seems to be worth it.

I Never heard of SPTN before. This is a tough business, but there appears to be some hard asset backing up this stock - 7M Sqft of owned distribution (warehouse ) space and ~1M SQFT of owned store space. Then on the negative side, their debt had been rising, probably as a result their capital returns (dividends and buybacks) which were above their FCF. I guess it’s reasonably cheap, but there is downside risk due to the low margins, if they misstep.

That feeling of relief and joy, when pigs in the portfolio fly, is priceless!

would you elaborate on MEGACPO? going through CHTR and Liberty complex has me interested in cable cos esperially in emerging markets. The thesis is simple - this is like US cable 20 years ago. It’s cheap (~7x trailing EBITDA ) and has a long growth trajectory. Also interesting is that it has virtually no net leverage (cash is almost equal to debt). The stock was a bit depressed after the release of the Q1 report (increased churn diente bad economy in Mexico), somI took a plunge and bought some this AM at the open. http://inversionistas.megacable.com.mx/en/reportes.php There Isa los a VIC writeup on this stock a while back (2017.). Biggest risk is macro and currency, imo.

Megacable MEGACPO.MX ( Mexican cable co.) and DWDP

I've not been following this much but who's that?

Another example of a great capital allocator and hedge fund manager CEO at work.

I am pretty sure that the leadership of TV is somewhat corrupt. These guys are part of the Elite around Pemex, Carlos Slim and the like that have the politicians in their pocket. I kind of like the New Mexican president and yes he has a socialist background, but seems pragmatic sonnst, but runs a coalitions with the right too and seems to try to dismantle the crusty elite that had been sucking out blood too long. Too early to tell, but I am somewhat optimistic. I do know that TV missed earnings because the government reduced advertising. I am not even sure why the government should spent that much on advertising on TV and I think it’s a the right move to just get rid of it. I also would appreciate if the government would step up pressure on TV to break up, as I think this might unlock a lot of value. Anything that sheds light into TV Management is appreciated. I keep warnings in mind,and control risk with position size. Do far it’s a small bet for me, but I like the odds.

GOOG looks quite cheap compared to the company currently IPO’ing for sure. What I think is happening is that the market is gravitating towards stories and story stocks rather than reward just good numbers. Each of these IPO’s has a story to tell, and investors are eating it even though for some of them the operating numbers look quite ugly. Even a stalwart like Disney could add $20 to its stock more or less simply buy telling a story how they are going to compete against the Netflixes of the world and the market is buying it, despite an hit to earnings. Google has plenty of interesting things going on, but there is nobody who narrates a story. So they are just putting up nice numbers, but nobody gets exited and a miss in the quarterly earnings games will result in a 10% loss of market cap, while their competitors are losing money even after adjusting the heck out of their financial statements. Somebody should tell Warren that Geico isn’t just an insurance company, but a disruptor and a subscription service & cloud service that should sell for 10x revenues based the future value of their customers, but I guess he doesn’t care. FWIW, I am fine with how GOOG goes about there business. I haven’t added yet (I did my buys ~$1000/ share last year) and think the stock may be in the penalty box a bit. I would love to add is ~$1100/ share, if it comes to that.

One more leg and you are back to where you started your journey ;D

Deutsche Bank would not be allowed to fail, but I don’t think the government would make much bones about nationalizing them either, They would go into a special vehicle or into the Abwicklungsgesellschaft. Banking with a government owned institution doesn’t the same stigma than in the US. Besides that, there are the Landesbanken (which are the master institutions of the Sparkassen) they have balance sheets around 200B Euro each. They can handle quite a bit of FX. the large companies like Daimler, BMW have their own treasury departments and even banks and don’t really need DB or Commerzbank any more. Personally I think DB leadership is doing the right thing deleveraging. I just don’t see a way around the profitability issue. I’d rather buy Barclays (which also trades at fraction of book -0.44x) , but operates in a profitable home market and their investment banking is better than DB’s. Of course they have Brexit too.... 0.44x book market is plenty cheap, imo.

Interesting that they detail the expense (money spent on stock purchases), but not the effect (shares purchased and retired). Usually, when companies frame it like this (indifferent to cost), you know they are not out to really maximize shareholder returns. 90% of all the companies doing buybacks seem to be like that.

Currency would become an issue. FWIW, their debt is about evenly split in USD and MXN. I bought some today for $10 & change as this is quite cheap, considering it is becoming more and more a cable company.

The problem with DB and Commerzbank is that Theresias no escape from Germany being overhauled. it‘s not just the private banks, most citizens bank with town/state owned Sparkassen or mutual/thrift like Raiffaisenkassen, plus there are lot of foreign competitors (angling for better customers) and direkte (online) banks. Even if DB and Commerzbank went out of business, it would barely make a dent. Quite frankly, these government owned banks seem to be better and more customer friendly run than their private instead counterparts. I don’t think the average citizen would give a hoot if DB would be nationalized in a downturn.

Holland, Michigan?

While I agree that MMP is cheap , they have a weak outlook for this year and I also think that their dependency on refined products warrants merit. I would rather own KMI or EPD which are both more diversified and geared towards NG. With an MLPs a long holding period is paramount, since a sale will recapture tax on distributions, which can give you a nasty surprise.

I have a grinder (Vario) and Espresso maker setup at home and buy my beans at Costco. I typically bought the French roast, but switched to other beans a while ago. Right now, I am buying beans from Costco from some roaster in Vermont. I hate switching beans because every time I do so, I need to adjust the grinder. I found the beans from Costco to be quite good and the prices impossible to beat. I like Starbucks, but not so much for the coffee, but rather because the shops are a pleasant environment , if need to to make a break on a road trip or have some time to kill.

There is no bad asset, there are just bad prices. Stelco looks to me to have a squeaky clean balance sheet and is earnings quite a bit of money (likely overearning at the moment), but is also distributing a lot of cash via special dividends. I see headwinds in earnings from higher input costs (the Vale dam incident has reduced Vale’s ore supply by about 20%) so I think earnings might fall this year and who knows what happens after that. They do seem to be a low cost producer based on current EBITDA earnings, which means a lot in a commodity industry. I think it’s a questionable buy for FFH to obtain a huge stake, because they can’t easily exit and might be stuck investors for a long time, but each of us could get out in a NY minute, if the thesis (which is really around dividend distributions) does not work out.

I own a few shares unfortunately. I failed to sell it when they clinical trial failed and the investment thesis wasn’t there any more. I agree it’s cheap now, but the cash on hand is certainly insufficient to bring a drug to market. I regard this as a lottery ticket.