Jurgis

I'm not sure ValueAct is a solution here. Even Buffett is a wrong person for this. They need someone with a vision - maybe not Steve Jobs - but perhaps Larry Ellison. They are making some right noises, but I am not sure the vision and execution are matched.

I suppose it is tempting, if you only hold FFH, to treat everything as if it were deflation. ;)

Thanks for posting. Edit: I agree that there are very few clear opportunities available. I disagree with a lot of above, but this is not the thread to discuss it. Good luck. :)

FCF isn't nonexistent, it just takes work to pro-forma the numbers. The acquired assets generate a lot of cash. It might exist in the future. This year so far it did not.

Pray do tell what is in your opinion "best investment opportunity offered by Mr Market at these times" then.

Which is possibly why BRK is so cheap. BTW, BRK ROE was always low. Nobody ever bought BRK for its plain ROE.

Well, how do you value this? You pretty much have to value at P/S basis, since earnings are negative, FCF is nonexistant. Based on OCF (100M in H1), it is not cheap. You can't value on P/B, since book is pretty much goodwill and intangibles. So, the bull valuation can only come from management projections... Or saying that 1 P/S is cheap for this.

I watched the trailer. The trailer looks stupid. :-\ We'll see how the movie ends up being.

That was a short sale...

+100

Optimists. That's what I like. Salute.

If China + EMs + ??? go down very hard, this could hit the air travel and subsequently airplane orders and deliveries. Everyone seems to be convinced that we are on air travel supercycle going up, but is that really true? (I am not really in the camp that world is gonna hard land. Also FWIW for me RR is in too hard pile, so my comments here might not be worth much).

Apparently this: http://www.siliconinvestor.com/readmsg.aspx?msgid=30246741

In http://www.cornerofberkshireandfairfax.ca/forum/events/boston-area-meetup-september-19th-2015-in-burlington/ TREVNI suggested the following exercise: Here's my writeup on the topic. Not edited, so it's quite scattershot: Fortune 500 list from 1995: Tough to think as if I were in 1995, so some of this is Monday-morning quarterbacking, but: I would have thought that XOM, WMT, T, GE would stay in top 10 for 20 years. I would have thought that GM, F, Sears would fall out of top 10. I don't have opinion about Altria. Not sure what I would have thought about IBM. (Not sure why Mobil is in the list... anyway, see XOM). Looking at current list, I see I would have been wrong about GM and F (though GM went through BK, so staying in top 10 is not really a win...). Would have been right about XOM (joined by CVX and PSX), WMT, GE. WMT would have been a great investment in 1995 GE would have been OK (great if you sold in glory days) XOM - OK IBM - would have been great return Looking at top 10 from year 2015, I'll predict: When I did this exercise, I doubted that any of the top 10 will stay in top 10 in next 20 years... After thinking about it more, some companies might stay. Here's my initial reaction and later reaction: Oil will play much lesser role in 20 years. Still XOM may survive in top 10. Later reaction: mega oil(s) might still be in top 10. WMT has Amazon'ication risk. Later reaction: WMT may stay in top 10. BRK has Buffett risk - I don't subscribe to BRK-after-Buffett rosy dream. Later reaction: unchanged. Apple has product change risk. Later reaction: unchanged. GM/F continue to have both "other carmaker" and new carmaker risk. Later reaction: unchanged. GE - has who-the-heck-knows-what-they-gonna-do risk. Though perhaps they have the highest chance to remain in top 10. Later reaction: mostly unchanged. PSX - a bit similar to GE - it's a new spinoff CVS - I think it's very likely gonna be gone. Looking at 11-20, I'd say VZ and UNH have a large chance to get into top 10, but they also can be sidelined. Reordering current companies by market cap to get top 10 by market cap, I think that: Google, WFC, JNJ and GE may survive in top 10 by market cap. Predictions are tough, especially about the future. Amazing thing looking at 1995 list is: 5/10 remained in top 10 after 20 years. Pretty much all 10 did not change businesses radically. Only 1 (Sears) is irrelevant now. 1 (GM) went through BK. The inertia is quite amazing for 20th-21st century.

BTW, oddballstocks is running a micro cap conference for people who want to talk to the management: http://microcapconf.com/ So here's your opportunity. :) I am not affiliated with oddball or the conference. :)

I wonder how many roll-your-eyes makes-no-sense-this-is-not-how-it-works-in-reality moments the movie will have. I hope they manage to keep it close to reality. "Margin Call" was great BTW ( http://www.imdb.com/title/tt1615147/ )

Can someone compile a list of who plays show? I first want to know who plays Michael Burry... he is probably the most interesting story in book. Christian Bale. http://www.imdb.com/title/tt1596363/?ref_=nv_sr_3 So, if you guys had to choose: get as much money as Mike or look as Christian, what would you choose? ... eh, wrong forum. ;D

Yes, my calculations above were wrong. I'll fix them. You get OK return even if you assume 50% probability.

What kind of odds do you guys put on this going through? Assuming: $0 if it does not go through, ~$1 if it goes through. $.40 price right now. You need at least 50% chance of this going through to make statistically OK return.

This is really my point. With larger companies, most of the material information is publicly available. To outperform, I just need to be wiser and more rational than the market. For small caps, I need to hustle AND be wise and rational. There is no doubt that the payoff for being right with small caps is higher. But the cost for being wrong is also higher. KCLarkin's Hierarchy of Investors: Smart-Eager: Micro/Small Caps Smart-Lazy: Mid/Large Caps Dumb-Lazy: Index ETFs Dumb-Eager: Real Estate +1. Though I think calling me "Smart-Lazy" is doubly wrong. ;) I'm not Smart - there are tons of people here who are much smarter than I am. And I am not Lazy - I don't call management not because I am lazy. I don't call them because ... oh well, we'd need to have at least 6 beers before I'd get to the reasons. :-X

I won't call management and will invest in mega caps. You guys can have a huge edge over me. Which I was trying to tell you. Are you satisfied now?

So, let's invert: if you don't phone oddballstocks and/or management, you have 40% handicap on a small cap. Suddenly mega caps look much more level playing field. 8)

Not if Phil Ackman comes out of White House and sees his shadow.

Right. This is one of the reasons why I hesitate to invest into GM or FCAU. It seems that car companies are hit by legal issues quite often. So can one discard the settlements and recalls as one offs or should we allocate some percentage of earnings towards this? With software becoming a bigger part of a car all the time, will we have more problems per year? It's also strange that AAPL and GOOGL want to get into this business. I guess they have cash to burn. As consumer, I am happy. As shareholder, probably not.

This thread is officially humor deprived.