Cicero

Not sure I get Raper's math. EBITDA is slightly below EUR 400 MM LTM (and has never been higher) and the business does have debt; about USD 200 MM net. Trades north of 7x from based on the the numbers I see on CapIQ. Not crazy for what looks like an OK business, but not a steal either. Never traded remotely close to the EUR 150-190 per share he thinks comps imply (note that the "historically traded at 30-40% discount to comps" and the fact that share price has never been above EUR 100 doesn't quite jive with his bull thesis). And on the downside, what is stopping Sonnenberg from not reinstating the dividend? Just sit back and wait a few years and have another run at this. If Sonnenberg ever gets this to squeeze out level. comps and all that stuff does not matter; whatever the stock price then is will be a pretty strong anchor in front of a judge. Read a few pieces of Jeremy on other things and he is quite good, but don't understand this one.

Thought the trading update was very good pretty much in every respect. 5%+ rev growth, +10% new category growth in Q1, market share gains etc. Did not mention heat not burn in the US which means it is probably underwhelming, but that really looks like the only soft spot. Really puzzling that there was basically zero market reaction.

Agree, not much new information. I thought the most interesting was what they did not talk about: Santa Monica (meaning lease up is going as badly as one would expect) + large scale non-retail developments (Hicksville, Denver, Redmond). Also though the illustrative math of the large scale projects was sobering. A lot of risk for relatively modest returns (though it includes the land at an attractive price). Sounds silly but I really do not like the management slide. Maybe reading something into it, but looks like Andrea Olshan is a bit of megalomaniac (only a picture of her towering above everyone else; not exactly the way to establish a collaborative team based environment).

Does anyone know what is up with Analogue? It is up a lot for a day without news. Feel like I am am the last person to understand a joke.

Hey RVP, No view on the business. Just wanted to share a few thoughts: The fixed fees for bookrunners in Asia are typically pretty low. These guys are paid based on the demand they bring into the book. So 1) I would assume that a big chunk of the economics go to the sponsor/ global coordinator and 2) there is some relationship between overall consortium size and fees paid but I would not assume that the number of bookrunners explains the fees paid here. HKD 53 MM does not sound low in absolute terms to be honest. Especially for Asia where fees are rock bottom and considering the fairly poor quality of the "banks" on this.

AR and Q4 IR book are out. Somehow not accessible through the website; had to ask IR. Enclosed in case someone else is interested. NICE Holdings IR book_2020_4Q_ENG.pdf2020 Annual Report(NICE Holdings).pdf

Announced results. Ex property sales the business lost money though the loss is fairly modest. Proposed a dividend of 15.4 cents a share. A bit smaller than what I expected. Interim report will be released Thursday after market close.

Is that an argument "for" or "against" ? Hard to tell ?

I am usually all for buybacks, but this situation is an exception in my view: 1. Capital allocation track record of tobacco stocks is pretty bad (former resident half wit Nic Durante being a case in point). Industry is much more consolidated now, but I am still not sure I trust them with the cash flows. I think the dividends and the debt instill a bit of discipline that I don't think these guys would otherwise have. 2. One the key benefits of share buybacks over dividends are the tax considerations. Given that there are no dividend withholding taxes in the UK it really depends on the individual tax circumstances of the investor. Assuming you are not taxed on your dividends, I'd rather have BAT pay a dividend. If I like the price, I can buy shares myself. Yes there are frictional costs in doing that in particular the stamp duty, but that seems like a small price to pay to have control over the cashflows. Call it a "free-cash-flow-to-equity-control-premium" + buybacks are not frictionless either in particular the stamp duty would be incurred regardless

@zhengmit The data point on JD is quite compelling. You made a very interesting point that you thought BABA would count items merely in shopping carts as GMV. If they did it would pretty clearly violate their GMV definition as items in a shopping cart can hardly be viewed as "confirmed". What makes think that BABA is doing exactly that? Could it be that the GMV is "only" inflated due to brushing?

I agree that one should not buy something because XYZ famous investor bought it, but Lampert is in a different bucket here, no? He sits on the board and has therefore access to more information. He also controls the possible outcomes through the OP units. So him selling out would be as concerning as management/ insiders selling out in other situations. Don't admire the management of other companies for their investing skills either, but if they sell in size all of a sudden you better have a hard look what's going on.

I agree with @FCharlie, Lampert still owns most of the shares. Here is why: # His last 13D was filed on 1-Apr. At that point RBS/ESL/Lampert controlled 9.1% of shares # If I am not mistaken 1% changes in ownership necessitate an amended 13D filing and unlike the initial filling where the grace period is 10 days the amendment has to be "filed promptly" which I think means in practice two, three business days # Also note that reporting date of the 13F is 31-Mar so actually BEFORE his last 13D # It also seems that the 13F fillings only pick up the shares solely owned by RBS Partners and not the shares with shared dispositive power (i.e. the shares owned by Lampert) So what happened here: RBS Partners sold out of the SRG shares in March over which it had sole control (consistent with the 13D filed 17-Mar). The 13F that just came out shows only the "inventory" of the sole control shares at 30-Mar, which at that point was zero as we kind of knew from the 13D filed 17-Mar. 1-Apr RBS and Lampert converted a bunch of OP Units which meant they controlled 9.1% of the shares outstanding. If I am not missing something here Lampert still controls these 9.1%.

Sorry I should have been a bit clearer on the land payment. You make a fair fair point on the potential to pay $58 MM. However, that rests on the assumption of a discount rate of 10%. Getting 10% on relatively short-term retail redevelopments that you can largely pre-lease (i.e. the stuff SRG has been doing thus far) sounds pretty good. But getting 10% for a mixed use greenfield development that will take serval years to complete with limited opportunity to derisk through pre-sales etc sounds not so good to me. Hence my comment on the limited potential to pay for land, based the assumption that a higher discount rate is warranted. In a different life I used to work on mixed use developments for a little while. Not in the US and granted interest rate environment was different, but a project like this would have been a pretty quick "no".

Its been suggested that Nice Holdings deserves its own thread in addition to the existing thread on Nice I & T. I quite agree, so here it is. Nothing spectacularly new to post except perhaps that the 2020 financial statements are on the IR website. One thing that caught my attention is the increasing holdco debt now at about KRW 130 Bn (all financial liabilities + pensions, net of cash and financial assets at FV) up from KRW 76 Bn a year ago. Ratio between current assets and short term funding continues to worsen a bit as well. Optimistic take is that they are investing in successful projects and we should see further results of these investments soon as the magnitude suggest they are getting sizable. The negative interpretation is that they are setting themselves up for a cash crunch if things don't turn out as planned. Anyway not super worried as they have some means to generate liquidity if needed, but something to keep an eye on in my view.

This is very thoughtful. One can obviously debate the assumptions; some look aggressive (timeframe) others quite conservative (construction costs, resi rent looks a bit low and a 55% NOI margin implies a service level that is perhaps not entirely consistent with the rent price point), but I think they look ball park ok. The one objection I have is that the calculation does not account for value of the land seritage contributes. If one believes the assumptions underlying this calculation, the consequence would be that a third party developer - who has to pay something for the land - could not profitably redevelop these sites unless the developer pays only a token amount for the land. Not an intuitive result I think.