Gregmal

Out. Too easy

So I've held off commenting here(outside of one comment) but this is an easy short IMO. The business is one dimensional and the greatest resource this company has(data) is becoming less and less useful to it. As I said at $170 after the Q2 earnings, this is challenged. Sentiment has shifted, no one is buying them out, they have nothing to spin off(WhatsApp and IG are just different versions of what FB already is), public and or private comps are not favorable, and the nail in the coffin IMO is that with the split now in government, regulating and choking off social media will become a bipartisan effort and FB is the whipping boy. They'll have huge headwinds over the next two years and at the least have to waste tons of time and resources making it look like they're reforming. Sentiment has clearly shifted and this is not a diversified business. I see tons of solid businesses trading at significantly lower multiples, so I see zero reason why FB can't continue to grow the bottom line will still treading in mud or even heading lower. And FWIW SNAP/TWTR are literally worth the equivalent of what FB's daily trading fluctuations are...I think IG is a premium business, right now(who knows what the future holds, just like MySpace in 2005) so getting anywhere near $400B on a SOTP is a major stretch for me...

https://seekingalpha.com/news/3407602-trade-desk-beats-0_15-beats-revenue Earnings looked great, yet stock now off $50+ from highs about 6 weeks ago. Just started a small swing position after hours. Would think if there is a bounce candidate, it would be here. This business has a lot going for it, although fundamentally it's incredibly expensive. Looking for a few bucks and then I'll probably be out.

I'm not accusing this company of doing this, but generally speaking, IMO these type of deals are generally the equivalent of stock promotions for sophisticated investors. These communities(COBF) inadvertently cultivate a sense of "in the know" from members and "access" that generally speaking, impairs ones ability to look at a high risk, low quality businesses as such. I'm curious to know how many investors are involved in this and Premier Diversified simply because of this site? Again, I am not accusing the managers here of anything....But being here, amongst sophisticated investors, likely gives a bit of a boost somewhere. You see folks here rigorously rip through other investments, and I can't help but think there is less diligence with companies like these because people want to believe. And in relation to this, why not just start an in house property manager? The ROI in that business is typically high. Asset light and very scale-able, much like money management. You wouldn't need an accountant, anyone who runs money should be able to do basic accounting or find a handyman. The problem with these "management" schemes is there's double and triple and quadruple layers of people getting paid to essentially do the same thing. If the CEO is managing the company, he should be able to do some accounting without drawing a fee or outsourcing it for one. I own investment properties and I do all my own management stuff. I guess if it was someone else's money I'd hire it off and bill them the cost though...

https://seekingalpha.com/filing/4223697 Silver Lake now at 7.4%

So in summary what I get, is that just like most value investors, Berkshire is sitting on too much cash and being way too frugal and nitpicky about buying stock.... Like most value investors I'd gander they underperform going forward. A good example of the cure here would be AAPL. When did they really turn a corner? When Einhorn and Icahn forced them to start deploying excess capital.

https://www.cnbc.com/2018/11/01/einhorns-greenlight-scores-small-gain-in-october-investor.html So he got the market annihilation he's been hoping for, and to boot his top long(AFAIK), finished the month +9%. And the fund did 1%! Every month Greenlight finds new ways to surprise me.

Results good, not great, guidance somewhat uninspiring but at these prices it doesn't need to be. Buyback up to max authorized at AGM. New investor presentation does a good job laying out the opportunity.

Sometime between now and early AM usually. NXP is one of the stranger companies I've seen when it comes to reporting. Call is 8 am.

Will be interesting to see the guidance, but given that these guys went balls to the wall with the buyback, and were speaking very confidently at conferences in September(IIRC), I think the quarterly numbers come in very strong.

Just my 2c but it seems like this is a great company at a horrible price that people who missed out are trying to justify buying on a relatively minor pullback. Kind of like FB except FB is an OK company at a more reasonable price, so essentially same dilemma.

In all fairness, they must be pretty creative to keep finding ways to get clicks and views. You'd think after a while people would get tired of it, but a lot of the networks know there is an insatiable desire from liberals for a lot of this. Like Jim Acosta for instance... let's see, how many times do we need to see the well rehearsed posturing, the grandstanding, and then predictably, without fail, 100% of the time, some anti-Trump, "gotcha" type of question or comment? That and the sound bites with no other purpose than to grab headlines. I was watching The Circus on Showtime and one of the episodes was showing the liberal mob following around Jeff Flake trying to persuade him to drop Kavanaugh. Some whackadoo granola eater runs up to him repetitiously pouting "but what do I tell my granddaughter?", "does she not matter?" and it's like "what the f*ck does any of this have to do with your grand daughter? you moron"... Or the elevator screamers, ""Tell me I don't matter!!!". Uhm.... Whatever issues you may or may not have had with sexual assault have nothing to do with this.... Crucifying a man without due process or even any legitimate evidence of ANYTHING isn't going to solve whatever mental issues you may or may not have from allegedly being assaults. But hey, all these sound bites get views and clicks and followers, so why not? My point, in relation to numbers I guess, is that they have no desire to be accurate, or get it right. They're careless on purpose...

https://www.cnbc.com/2018/10/31/general-motors-earnings-q3-2018.html Smashed it. Now keep your mouth shut Mary!

I can't put a finger on one specifically but MSB IMO should re-rate to $40+, with $3.50+ in distributions along the way.

Big earnings release upcoming. I'd like to see some sort of confidence signal from these guys. They already declared the dividend this afternoon, so no change there. Would have liked to see a modest bump to maybe 40c a quarter and a nice big buyback announcement. There's no reason this shouldn't have been doable given the supposedly "conservative" approach they claim they've been taking the last few years. Hopefully there's also some more color on Cruise. That said, I'm fully expecting the share reaction to be poor. Mary Barra seems to have Dougie Parker syndrome. The uncanny ability to ruin nice operating results simply be opening her mouth. I wouldn't even say I'm cautiously optimistic here. As a GM shareholder I continue to be short term bearish, really long term bullish. Silly to be anything other at this point.

LOL

My sense is that some of these institutional investors just love diversification so much that they will happily put a portion of their funds in almost anything as long as its returns are expected to be uncorrelated with what they already have in their portfolios. More generally I think it’s a good sign that you are asking these questions. It is IMO worth spending some time studying the behavior of these investors, as they tend to be big suppliers of market inefficiencies that good and nimble value investors can profitably exploit. This is kind of what I've been told too. That's why, as great as Jim Chanos may be, institutional managers just relentlessly throw money at him so they can call themselves long/short... Hi Greg, thanks for the reply I have got a question. So are you sayin that instituitional investors do not really have a defined plan on how they deploy capital? Like, they don't care about the quality of the investment funds they are investing in, and only care about the generalised strategy that the fund is using? It's not a one size fits all answer but the crux of a lot of them now, simply because of how easy it is to raise obscene amounts of money, is definitely more skewed toward finding something marketable. I've heard a bunch how despite Chanos's numbers actually being quite poor(IIRC someone said he's lost about 4% a year on average since the early 1990's) he continually gets allocations from funds because it allows them to claim they have a diversified or long/short strategy. That alone probably raises millions despite these people knowing if history repeats, they're allocating money to a losing venture.

My sense is that some of these institutional investors just love diversification so much that they will happily put a portion of their funds in almost anything as long as its returns are expected to be uncorrelated with what they already have in their portfolios. More generally I think it’s a good sign that you are asking these questions. It is IMO worth spending some time studying the behavior of these investors, as they tend to be big suppliers of market inefficiencies that good and nimble value investors can profitably exploit. This is kind of what I've been told too. That's why, as great as Jim Chanos may be, institutional managers just relentlessly throw money at him so they can call themselves long/short...

I can simplify it for you in a way that many here might not like. Anyone managing more then a maybe low 8 figures is a salesman or employs one. Whatever strategy will raise assets is what they sell you. They get rich not by trouncing the market but by charging fees, and by the time you get tired of the pitch they've acquired their pound of flesh.

What do you consider cheap for RE companies? Do you base in on cash flow or earnings? Most important for me is sum of part for RE, provided it's got an honest management and/or capital structure that would allow a third party to come in and take it. Cash flow is great, but can be hidden, earnings don't mean much IMO. Being able to have someone see a discount to SOTP and swing in and take it out are the margin of safety.

There are certainly risks here. Only time will tell if HTL can navigate them. But one company's risks and regulatory issues are another company's moat...These are called barriers to entry if you are good, and they become excuses if you aren't.

https://seekingalpha.com/news/3401819-fbi-probe-tesla-intensifies How dare they question Tesla. Fake news!

I think what's neat is that, like in the article, this may lead to breakthroughs when it comes to solving things like certain cancers/diseases. For decades billions has been poured into R&D. But maybe the biggest piece of the puzzle is screenings like the one mentioned... Very interesting stuff.

Clearly because the product is SO good and people love them! The more love the bigger the margins get. Of course I'm trolling some, but sometimes when I read a bullish thesis this is what it seems like. I've seen very few longs with a model as to how they get from x to y and what justifies each. This is just a magical company and you're either on the hype bus or you're some terrible human who hates the earth and somehow is opposed to saving humanity. No one can explain margins, or why numbers are what they are. But they are saving the world and anyone questioning it isn't, so there's no discussion, and no attempt to. I think part of the problem is this is a luxury brand, but also a luxury brand with a mission. Tesla owners (and I'm infering this from reading forums, posts etc) look down on those with gas cars. We don't 'get it' and of course most people don't have $150k to dump into a vehicle either, especially when $150k buys you a house in most of the US. So there is a superiority complex, a luxury complex, and with that why would you need to explain things to peons? This is really a 1% purchase. The interesting psychology is with the Model 3 aspiring 1%'ers can join the club for $50-70k. No intention to offend anyone who owns one. Congrats, as Buffett has said you've hit the genetic lottery and are wealthy. I'm glad you can enjoy the fruits of your wealth with a nice purchase. But I think it's unfair to extrapolate your reality to presume that's what it's like for all Americans. I think part of the reason bulls (and most are owners) have trouble discussing this is because personal identity is wrapped up in this purchase. If you buy a very expensive membership to a very exclusive club how open are your eyes to problems with that club? Dalal is the highest conviction sideline participant I've ever seen. All jokes aside I think this is pretty well said. I'd add that the group you talk about is probably also unaware of this bias as it's a very common theme in Silicon Valley. I mean Tesla is huge on the west coast and especially in techville. This is the same land where 200K is lower class and 3M gets you an 1800 square foot home. It's totally out of whack but a very real reality for those that live it. The same world where 100x sales is normal and 1B is chump change. BMW is a luxury brand and so is Apple. So is LVMH; so is Tiffany. Many have larger TAM than TSLA, all have real profits, and none trade at the valuation TSLA does. While I think there are many high quality stocks that are currently quite cheap, I'm also beginning to get cautious as I've found a signal of the end of the run is value investors capitulating and becoming fanboys of froth stocks...

https://www.technologyreview.com/s/612258/are-we-designing-inequality-into-our-genes/