Gregmal

https://hbr.org/2018/07/the-real-story-of-the-fake-story-of-one-of-europes-most-charismatic-ceos Pretty fascinating

I think "value investing" is largely misunderstood. Or maybe I am misunderstanding it. Whatever; my understanding works for me. Value to me is simply seeing that something is mispriced. Seeing what others don't. I feel like too often value investing gets mistaken for buying x below it's intrinsic value, which is kind of narrow-minded IMO and typically reserved for businesses that face headwinds/ questions about their existence. This is why many value investors end up watching an obvious investment like GOOG or ISRG for a decade constantly bemoaning how it's just too expensive, but how they hope to buy it on the pullback or whatever.

This is a funny way to look at this, but it is exactly what any activist investors are out too do. Get a quick pop in the stock price, activist can sell out at a nice profit and move on. However, it is not the management job to comply with this. When I look at Einhorns recap approach using preferred stock, it is quite clear that his is what he wanted to do. Besides the fact that it probably wouldn’t habe worked (he valued the preferred way to high in his sandbox game), it would have created conflict of interest and difficulties further down the road, which of course wouldn’t have been his problem. I am not a shareholder, but just from looking at the numbers, GM’s management has done fine. The stock has just not been awarded a multiple expansion like some others, that’s why it hasn’t moved much. in my opinion, management job isn’t to get thr stock price up, it is to run the business well. This should lead to a higher stock price , but sometimes it doesn’t, which is why value stocks exist in the first place. This may be what some look to do, however the basis of my comment more so was referring to the fact that this is a pretty good indicator that management has given the market zero reason to get excited about the company. Look at the ultimate auto disaster, Ford. For the past roughly half decade, the shares have just gradually eroded. Never has there been any excitement around them, never has the patient long term shareholder been in a position to reap the rewards of their investment, never has anyone but management been rewarded. So in summary, when your share performance has been poor(check out this morning), corporate governance lacking, and the market clearly demonstrating to you that it has no interest in what you are bringing to the table. perhaps it's time to re-evaluate your strategy; even if "on paper" it looks and sounds good. A public company's job is to create value for shareholders. The stock performance has been bad, the dividend payout is low and hasn't been upped in years, and the buybacks have been mediocre. What has GM's Board really done for shareholders?

What exactly is an "activist" going to do? GM is well run operationally, capital allocation is fine, left markets where they have no scale, if anything, they should cut the dividend. The article nailed the main thing for me, and that is that management is not well aligned. There is next to no shareholder representation on the board, and that they hypocritically talk about "the long term" while compensation management for short term stuff, without actually holding them accountable for the ultimate short and long term measuring stick, the stock price. Compared to peers the performance has been pretty bad too. You can say it is run well operationally, and I'd even largely agree. But at the end of the day you are lagging the market, and lagging peers, over a short, medium, and long term horizon, then I would probably say that this is all the evidence you need to conclude that you have the wrong strategy. Which peers? Over a 5 year period....FCA is the only one that has significantly outperformed. GM has also trailed Peugeot. GM has done better than Ford, BMW, VW, Toyota, & Hyundai. Was looking at performance since GM IPO. Companies I follow TM, Hyundai, FCAU, BMW have all done better(Hyundai has come back down to Earth a bit of late), while GM has basically been middle of the pack to mediocre with the rest of the autos and not ever even gone anywhere whereas some of the others have gone on ridiculous runs and at least given shareholders a chance at profit. Ford I don't count because it's such an obvious turd that you only have yourself to blame if you've invested in it. I'll elaborate further. Companies that at least go on decent runs(like Hyundai or even GM earlier in the year) at least show that they have gotten the market excited about their business once in a while. It also gives investors a chance to trade the position. GM up until earlier this year had been a complete turd that barely budged to the upside and only gave you a chance if your strategy was to BTFD and sell for $1-2 a share profit. Which only adds insult to injury when senior management gets gifted shares that they then immediately dump on investors regardless of price, even when they continue to tell you how great of an investment their company is.

What exactly is an "activist" going to do? GM is well run operationally, capital allocation is fine, left markets where they have no scale, if anything, they should cut the dividend. The article nailed the main thing for me, and that is that management is not well aligned. There is next to no shareholder representation on the board, and that they hypocritically talk about "the long term" while compensation management for short term stuff, without actually holding them accountable for the ultimate short and long term measuring stick, the stock price. Compared to peers the performance has been pretty bad too. You can say it is run well operationally, and I'd even largely agree. But at the end of the day you are lagging the market, and lagging peers, over a short, medium, and long term horizon, then I would probably say that this is all the evidence you need to conclude that you have the wrong strategy.

https://www.cnbc.com/2018/07/24/alphabet-may-become-the-berkshire-hathaway-of-the-internet.html

https://seekingalpha.com/article/4188677-general-motors-time-activist-involvement Makes some good points and I've always thought a longer term activist would benefit here. Funny though, how when we got one, people bitched and moaned about it. Hope they are enjoying $39/share...

Blowout. Still going strong, 25% y/y rev growth. Sometimes investing is easy.

Keep it simple and just go with HACK or CIBR.

This stock is like GEICO in 1951! Bro up, compound down! Too legit to quit! So on and so forth.... I don't think this is a business you'd want to own after a deal break. Definitely isn't NXPI. Strictly a numbers trade. That's part of the reason I don't see anyone blocking this. Radysis isn't anything special.

Yea it's odd. The company has an earnings call soon and will be hosting a conference call apparently to discuss results which to my knowledge, normally isn't the case with a merger pending. But who knows. The key is as writser alluded to, is finding these types of situations and then just trading them for short term price adjustments.

Have you ever worked anywhere with a toxic culture? A few platitudes and signs on the wall don't fix things. Not everything can be fixed by armchair quarterbacking... I think it's even more evident at an institution like WFC or really any large bank. The branches don't really have a great association/relationship with corporate. The people there, for the most part, are paid poorly and know how much more the big wigs make. If something goes wrong, it's always them who get whacked first and they know it. They have to see all the branches and jobs being cut across the country which is likely a constant stress. I'd imagine less so now, but certainly not too long ago there was also a stigma attached to working for "the evil greedy banks". Not to mention the mood in the branches often resembles the excitement one has during activities like watching paint dry or water boil.

Update: Sold at 9 for 1% in 2 days. Remaining .6% per month is not worth my capital. Would look to re-enter mid 8.90's.

Have been following as well and have gotten no indication of a way out of the termination payment. My assumption is this will have to sit in purgatory for a little while as it probably has one of the oddest combination of investors currently in it. Shares will then change hands a couple more times before this finds it's footing but all in all I see nearly $10 of EPS 18 months out(ie 2020 numbers) and worst case $8.50 for 2019. So we could win short term in a big way, or wait out probably more upside with the option to add lower. Good situation to be in. Who cares if you take a temporary paper loss?

Correct. Schiller was a bum, and ran the previous company into the ground. But he was removed from his position and has nothing technically to do with the new post bankruptcy company.

Opened small position at 8.92. Q3 close, all cash deal, IRR should be at least 12% or so depending on exact close date. Nothing crazy but this isn't some merger deal where you need to hang around 6-8 months to get the spread. 2 months tops.

In the current climate - why would China approve this deal? What is their incentive to do so? I think you need to flip that around. Why wouldn't China approve this? Not approving this, is an irreversible blunder. Probably worse than any tariff because it can't just be "undone". Holding this in limbo forever has the same effect without the lasting consequences. Otherwise, agree that this is just another example of market stupidity. Just like Peter said. There's no reason any investor who's holding a pile of cash shouldn't be in on this. Risk to reward is excellent on both short term and long term basis. Or wait, TRADE WAR! Dump your stocks, tank the market several hundred points, and then watch it trade back to the same level within a week!

http://www.espn.com/nfl/story/_/id/24058233/carolina-panthers-owner-david-tepper-contract-keep-statue-jerry-richardson Article itself is pretty bland, but read the below and just kind of chuckled. Some guys, the wheels are just always turning. "He is considering moving the team's practice facilities to South Carolina, in part to keep both states interested in the team. The Panthers currently practices on three fields within walking distance to their downtown stadium. Tepper said that valuable land could be then used for developmental purposes." This guy just prints money. Even a football team he just paid 2.2B for, he's already finding value plays for.

I've read the book and it's a good read if you are into investing but nothing spectacular and agree it's only regarded the way it is because of it's rarity. Klarman himself seems to be a bit of a jerk. Just like Paul Tudor Jones supposedly buying all the copies of his PBS documentary on the 87 crash, how friggin narcissistic do you have to be put something out there(presumably for money) and then later go out of your way to prevent people from using it?

Read. Anything and everything. If you are a capable investor your brain will eventually start linking things you read, find interesting, or come across in everyday life with a way to capitalize on the pieces that are worthwhile. The greatest gift to the modern investor is the internet. The big reason I think hedge funds are no longer performing is that their edge used to be information. Now everyone can access almost anything via the internet. While the biggest names in the biz have hundreds of portfolio managers reporting their best ideas to them, you can too. Following credible blogs or investor forums more or less acts as a funnel in which the brightest people bring you the best ideas. Your job is simply to figure out who the brightest people are and what ideas are worth digging into deeper.

I've looked at a few but admittedly spend less and less time there. Like rb said, there's just too many other opportunities out there and it just doesn't make a while lot of sense to me to spend time somewhere that has an incredibly high hurdle. I've liked Yandex, and looked at OGZPY before, but at the end of the day I try to be impartial to names and businesses I like and instead break things down to a number. Total expected return. And if I can find the same number elsewhere, with less risk or headache, that's were I go. FWIW I remember Jim Grant pitching OGZPY several years ago at Sohn or one of those conferences. The thesis was that oil was bottoming and it traded at 4x earnings. Well the thesis was right and you'd think three years later with the massive oil recovery, not to mention when something is trading at 4x earnings you'd think after three years of earnings it would be at least 50% higher, nevertheless its substantially down and in the toilet. I have not followed super closely so if there was a large capital return I stand corrected but as of now the shares are at $4.50. It was at $7 when he pitched it. Numbers just don't add up and that's why it's just too much hassle to do Russia right now. Even the good ideas can be a disaster. Instead I bought BP at 33 without even thinking and have had an effortless return.

Corporate governance is responsible for protecting the interests of shareholders. When that fails the courts are there to do so. In some countries, not only does an investor not have the assurances of either, they have the expectation of neither. This makes it a "no go" zone, for me at least. Similar thing as walking into a US investment with concentrated management ownership or dual class structure. You better be familiar with the terrain otherwise you are in for a rude awakening.

I think the bigger thing is simply that in many countries you have laws and/or various systems of checks and balances that protect shareholder rights. In countries, and with companies where there isn't confidence in the system, what is your recourse as a shareholder? Good luck with a poor corporate governance campaign, proxy fight, court case in Russia...

Not sure how it works at Expedia but rental car insurance through the actual car companies is a total waste of money. Not only should your standard auto insurance policy cover rentals, but many credit cards also offer it for free. I've been told the rental car agents get 1/3 of what you pay for the insurance in commission. I went on a week long trip to the Florida Keys and the total for my rental car was about $250. Then these idiots offered me the insurance, along with the whole scare story about "what if something happens", for another $100-$150 for the week(my auto for the entire year is about $1,800) along with the "option" to pay $50 for an unlimited SunPass to cover the three $1.25 tolls I would be traveling by...

This is just another area common on Wall Street where there is massive conflict of interest. Not to mention that companies(just like money launderers) who are engaging in wrongful behavior are typically very generous when it comes to compensating those that facilitate their schemes. I remember hearing years ago about a couple brokers who had a client letting them charge around 5% a transaction, multiple times a month to buy various different equities. A few years later I heard they got caught up in a money laundering scheme with the client who happened to be from South America. Same thing can be found reading through various reports from Mox or Muddy Waters, etc. These audit firms who get paid hundreds of thousands from micro cap companies who eventually then get busted for illicit activity. This stuff is also fairly common with lawyers and "legal opinions". Or doctors writing bogus scripts. Bottom line, is if you want to do something, there's someone out there willing to help you, IF you pay enough.