Parsad

Congratulations Jeff! Cheers!

Looks to me like Apple in 2013 has been building a foundation that it will use in the coming years; that is leadership. Apple clearly sees where the puck is going.... it is called mobile. iphone and ipad are the future (not Mac) and that is why they have updated their software to work across all Apple devices (great with iphone and ipad while pissing off some Mac power users). We did noy see any new product categories in 2013 and, yes, this was a little disappointing. I trust Apple knows what they are doing and will launch the new products when the time is right. In 2014 I see lots of line extensions that will drive sales in mobile such as a larger screen iphone and ipad pro. Everyone has realized that everything is going mobile. So how does this differentiate Apple? Regarding margins, Apple for fiscal Q1 is forecasting GM = 36.5 to 37.5. If we include the $900 million software deferral the midpoint is actually 38.5% to compare to prior periods (based on the comments on the conference call). The real news is the margins Apple posted in 2012 were crazy high for a bunch of reasons unique to that time period. It looks like Apple will post improving gross margins in fiscal 2014 compared to 2013. We'll have to wait and see. When margins were well above 40%, many said that they wouldn't go below...while some of us said that not only will they go below, but they will compress further. Apple insisted initially that margins would not compress too much. So, only hindsight will tell us exactly what is happening. Not that compressing margins are necessarily bad. As long as your margins are higher than your competitors and your revenues are increasing while demand for you product is strong, lower historical margins simply allow you to take more market share. Now is this what is happening to Apple, or are margins compressing because product demand is slowing? At this point in time, to suggest that Tim Cook is comparable to Steve Ballmer is being very unfair. Now having said this, I thought Tim Cook's answers to analysts on the last conference call were VERY poor; I am hoping he was just having a bad day. Of course it's premature, but we've seen this rodeo before right? Look at Blackberry's collapse. And I'm not saying that Ballmer was a bad CEO...he wasn't. But he wasn't a great CEO either...he was adequate relative to what else was out there. Cheers!

Did the same, other than the calls we will now exercise and keep, as I would like the spin-off shares. I'm also selling off our Sears puts today too. Cheers! So you bought both calls and puts? Or did you mean you wrote some puts? We bought the calls early, and then bought short-term, out of the money puts to protect some of the downside. At this point, with Lampert selling assets quickly now, those puts probably won't go up before they expire...thus we sold them alongside the calls which are up over 100%. Cheers!

One more thing. They state very clearly that the ASP decline was primarily due to lower priced skus. Yet you translated that as they're blaming it on currency. Ask yourself why you translated it that way. For some time, they stated that there would not be significant compression of margins. Now there is significant compression of margins. Not because we've had to move to lower priced SKU's to retain market share, but because we've CHOOSEN to move to lower priced products to attract the first-time buyer. Why have they choosen to move to lower-priced SKU's if they aren't losing market share to other lower-priced competitors. Not that doing so won't necessarily work...BMW proved it with their MINI division, as did The Gap with their Old Navy division. I'm just wary of executives who buy into their own company's hype and then realize they may be slipping. Again, Ballmer comes to mind when he espoused how great Microsoft was and then saw their ass get beaten by up and coming competitors. Cook has been sipping from the same Bacchanalian wine glass as Ballmer...others are on their tail, and we'll have to wait and see how Cook handles it. Cheers!

He states very clearly that it was the increase in lower priced skus. In fact, he mentions that before the currency. Also, if you read the transcript, you'll see Tim Cook talk about price elasticity and the iPhone 4. So far Cook's time in office has been akin to Ballmer 2! He's doing almost everything right you would think from a CEO perspective when it comes to dividends, buying back shares, retaining market share, etc. But the moat isn't expanding...he's just holding on and headed in all of the directions his predecessor said not to go. Revenue is slowing, margins are compressing...whether you want to believe their comments that it is occurring because of their intent to attract first time buyers or not...the fact remains that margins are compressing. Their products are now a commodity like any other, and their competition will decide how far those margins shrink. Cheers!

Did the same, other than the calls we will now exercise and keep, as I would like the spin-off shares. I'm also selling off our Sears puts today too. Cheers!

LOL! No. They are coming very slowly to me. If we get to the point where we file our position, you guys will know then. Cheers!

Chris, it's Peter. Sequentially we were relatively flat, so I'll comment on a year-over-year basis. They were down 7% as you indicated and this was primarily due to a significant increase in the sales of our entry SKUs where we had made them more affordable to attract more first-time smart buyers. We've also encouraged some FX headwinds from the yen, the Australian dollar and a number of the emerging markets which impacted us as well. I don't want to forecast ASPs for the December quarter. We'll report to you in January what they were. But the FX headwinds will likely continue given where exchange rates are today. Translation: We're going to blame foreign currency translation, even though we've decided to compress margins to retain or acquire market share. Cheers!

Could be both, couldn't it? ;D This time I'm not even going to respond to any future guesses at all. You guys are seriously too good at this, and any clues I give, somehow you will figure it out. I've learned my lesson once now already. Cheers!

Mohnish is doing his annual lunch auction on Ebay, with proceeds going to his foundation Dakshana. Bidding has topped $4,000! Wow! Keep it going guys...you will be having lunch with the "Bono of Value Investing" as I've affectionately anointed him! Jai Ho! http://www.ebay.com/itm/121200878501 John Mihaljevic, founder of Manual of Ideas, is also generously donating a Munger bust he has. Bidding is already at $1,600+! All proceeds go to Dakshana. Cheers! http://www.ebay.ca/itm/Charlie-Munger-Bronze-Bust-/121201494668?pt=LH_DefaultDomain_0&hash=item1c382c0a8c Cheers!

No, but it's big. I didn't go all in with BAC in my personal portfolio, but close. I've also found something else that I'm really intrigued by and think it could be even better...5-10 bagger in a relatively short period of time. You guys would be surprised! Has risk like anything, but I'm trying to take a big position. What else am I going to do with all of this cash! ;D Cheers!

BAC has a lot of issues but it is in a "stable" industry and they have substantial earnings that will survive. On the other hand, a $40M tax bill is a big item for a media company that is in transition from print to digital. and the CEO being a 30% owner also has substantial influence on the direction of the company, which makes a good reason to talk to them. BAC had much more risk than Glacier. It was a leveraged business where most of it's equity could have potentially been wiped out by legacy issues. Relative to BAC's normalized cash flows, legacy issues accounted for about 3-4 times annual cash flow. For GVC, in the worst case scenario, you are talking about 1.5 times annual cash flow in a company not nearly as leveraged. If I'm buying a car or a house from someone, I'd talk to the owner and the neighbour , get an inspector, etc, etc, and I'd do the same if I was buying the entire business - so I see no reason why not to talk to them even if I'm buying a fraction of the company. You would be better off talking to the competition or an independent party, not that dissimilar to a house inspector or neighbour. Talking to management is like asking the owner of the house if the roof leaks! I'm in the architectural / construction industry and my brother is in mining - we get their trade magazines and there isn't really anything in there that someone in the industry don't already know. It's really a medium for a company to get their names out by publishing something, and the publisher makes money on the subscription & advertisement. In fact I was recently asked to submit an article. Perhaps I lack imagination, but I am having a hard time seeing this as being relevant over the long term. Lol! Gary, why do you buy their publications then? It's like the Business in Vancouver I get or the Community newspapers I receive. Sure, the information isn't ground breaking or unavailable elsewhere, but it is the primary source to do exactly what you said...get your name in it, announce something or advertise to potential local customers. Same with local news paper. The stuff in the community is important, but Internet, location-based social network apps / websites are brining things closer. Plus, people growing up now (who are in their 20s ) are probably used to seeing couponds emailed to them rather than embedded in the newspaper. And Canada Post does a better job delivering flyers than newspaper. Canada Post, like USPS, is essentially bankrupt. The reason being that private companies do a better and more efficient job. Yes, I agree about internet, location-based social network, etc, but how would that fully disrupt Glacier's business, if they also have 60% of their business online now and are just as capable in competing through the same channels? Yes, they will lose some market share over time, but it won't be as bad as large metropolitan newspapers, because their distribution networks are smaller and more efficient. They are not retail distributors. I agree this is cheap - but i'm having a hard time seeing what will add to the top and bottom line over the long term... So i find the need to call management and tell me what i'm missing..... also reading the posts here. Don't ask management. Ask other boardmembers here that don't own it what they see wrong. That's going to give you a more accurate perspective than management. Cheers!

They'll pop, but you won't benefit from the spin-off in terms of any long-term value. The shares would only be issued to shareholders, not LEAP holders. I would actually want to own the Lands End shares, since it is very well run and profitable. Maybe even the Auto Service Centers. So, unlike the Sears Hometown Stores, it may make sense to exercise whatever number of LEAPs you want get shares from. Cheers!

I'm not a particularly big fan of talking to management. What answer could he give you that would be legal and put you at ease?! And if such answer did arrive, how confident would you be in the value of that response, since he works for the company? I didn't call and chat with Brian Moynihan when I wanted to know if BAC was a good investment! I think many investors skew their perspective and own analysis, by listening to what executives and other investment managers say. How many people bought SHLD because of what Eddie and Bruce were saying? What's Eddie's average cost in Sears these says? Do your own work, and forget about everything else. Cheers!

Lol! Yes, I've heard this stuff before with various investments. Granted, I wish Eddie took these sort of actions sooner. Cheers!

More likely he did not pay the $20 one-time free registration. I think people skim over the "Terms of Use/Registration" stuff, so he might have missed it. If someone has registered, but not paid the fee, that's almost certainly the reason a membership doesn't get approved. And while I would like to approve every membership, I don't think it's fair to approve one without payment, when others have paid to get approved...everyone should be treated the same. Cheers!

That response looks similar to the response Buffett gives to anybody who asks if they can work with him or work for him. When I was younger I wrote Buffett a letter asking if I could intern for him and got a similar response. I'm guessing Mohnish asked Buffett something similar since the letter was dated in 1999, which I think is right before Mohnish started his own investing career. He did. Buffett told him that he would be better off doing it on his own. Cheers!

Very nice of him! Much appreciated. Cheers!

They are mostly trade specific journals or community newspapers. We get two copies of Business in Vancouver in our office at something like $125/year for each. It comes once a week, and is very specific to Vancouver business...does a much better job than the local or national newspapers. I wait anxiously for my community newspapers as well, since I'm a hardcore grocery shopper and go through all of the flyers every week. I've done that ever since my Dad died when I was 21, and I started buying the family groceries. I need my flyers each week! So, there are innate moats to these types of publications that would make competition hard for those entering the market...even with significant amounts of capital. Thus the reason Black Press and Glacier traded a number of competing community papers two weeks ago...too hard to make a buck with competition...but once you are the only game in town...the economics change! Cheers!

Just keep expectations tempered folks. Cheers!

I wouldn't read too much into the stock price. Insurance is positive, hedges are negative, bond portfolio is negative, equities are positive, BBRY is negative, possible inclusion into indices is positive and a host of other possibilities. Cheers!

Is this really a fair characterization? Remember the board was recently going to use $13 just to buy Biglari's shares. Also, it seems strange to imply that this is a short-term, one time, 'simple-minded' way to suck cash out of a business (I'm not sure what else you could be criticizing by that statement). His time frame is not short-term because if it were, he would have taken their offer to buy back his shares. Also, when he was asked about his exit strategy in an interview, he replied with something along the lines of, "We have one of the longest time horizons in the investment world." And since you don't seem to believe anything that comes out of his mouth it should at least be obvious that he doesn't have an exit strategy and doesn't seem to care. In fact, I can't think of anything that has occurred to indicate this is a simple-minded way to 'suck cash out of the business.' This is capital allocation 101. If the business does not need the capital to operate safely, it should be invested or returned to shareholders. It's clear Biglari can invest the capital better than CBRL management and so it's obvious why he wants the dividend paid. If you think that his proposed debt level is too high, that's one thing. However, I've yet to see anyone make that criticism. I'd be interested in an intelligent discussion on the matter. How can you have an opinion on whether they should pay the dividend without an opinion on CBRL's optimal capital structure? This is subjective. Is optimal capital structure to pull cash out of the SNS subsidiary, so as to allocate it into a one-shot all or nothing bet on CBRL, while same store sales stagnate at SNS? CBRL management did many things wrong, but they were far from negligent. Also, BH's horizon isn't anywhere as long as you think...that's a veiled threat to intimidate incumbent management. BH's horizon only extends to their next action to release capital or take control. Cheers!

How about in a non-confrontational manner? This was a shitstorm brewing because Biglari is automatically identified as the type of investor he is...my way or the highway...your shareholders, my shareholders, and everyone else be damned. He is doing nothing illegal, nor any different than many other Wall Street types. My opinion is that as a student of Buffett, maybe he should have gone that route...especially when you were pretty much writing your annual letters verbatim to Buffett's, including font type, structure, shareholders, etc. The wool was pulled over too many eyes, including mine. Now he's doing it on a bigger venue with a bigger audience. I'm tired of the minion of activists...both long and short! It's about time for a major stock market correction, because everytime one happens, many of these assholes disappear for a few years! Cheers!

Just a stupid, simple-minded way to suck cash out of a business. I'm not a fan of this type of behavior. One time jackpot for an activist investor, while the company gets saddled with more debt...mind you at a lower rate debt to justify the action. My personal opinion if I were a long-time shareholder of the company...go fu*k yourself Biglari! The board would be a bunch of spineless idiots to cede to this type of behavior if they have an iota of ethics...mind you they are dealing with someone whose conviction does not falter as much as his word. Why not refinance the debt at lower rates, and pay higher quarterly dividends to shareholders, instead of adding debt? Because so this asshole can take the cash out of the company and walk over to his next target with a larger warchest...with or without taking over the board. Icahn 2.0! Cheers!

Unfortunately, the letters are not public. Cheers!