Liberty

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Multiples aren't that high compared to interest rates. If we had those multiples with 8% or 18% interest rate, that would be something else. Not making a macro call, just saying that what would be much weirder would be to have 10x multiples with almost 0% interest rates... You're right. If I were to look at it from the efficient market view, based on the current interest rates the multiples imply fair prices if everything stays the same. What scares me is that you have record high margins, low inflation, zero interest rates, and these multiples. Not much improvement to be had on all those fronts. So if all stays the same then you have fair prices and get something like 7-8% pa returns. If anything changes, the market is overpriced and you'll have bad returns. To invert the situation, if you're looking at the early 80s you had low multiples, low margins, high inflation, and high rates. A lot of the great returns from 80s and 90s came from improvements in those factors. Now we're in the opposite situation where all those levers have been used up and all the changes can really only go in the opposite direction. I'm not making any calls either. Just food for thought. True. But in the 80s people were looking back at the horrible 70s and expected more of that. Their low multiples didn't seem that low to them at those interest rates at the time, which they expected to stay high longer (because they expected inflation to continue for a long time, even Buffett wrote about inflation a lot). Now we're looking back at the horrible 2000s and expecting more of that. Just from a different angle in both cases. Who knows?

Q2: http://ir.libertyinteractive.com/releasedetail.cfm?ReleaseID=925878 Market likes it. Up 8%.

Bought a little more at 112.20. Thanks Mr. Market! Edit: Looks like I bottom-ticked it. Maybe I should have been a day-trader. Ha! ;D Also: http://www.wsj.com/articles/ibm-apples-rival-turned-partner-plans-to-help-other-companies-adopt-macs-1438765914

Multiples aren't that high compared to interest rates. If we had those multiples with 8% or 18% interest rate, that would be something else. Not making a macro call, just saying that what would be much weirder would be to have 10x multiples with almost 0% interest rates...

Pretty sure people who have lived through real communism might want to disagree with you...

WOW! I know it was bad, but when put in context the 2000s look like a total disaster! I know we starter at a high and finished at a low but still WOW. Well, this is what people expect will be repeated all the time going forward, apparently...

Waiting for a 'normal time' to invest? https://theirrelevantinvestor.wordpress.com/2015/08/04/waiting-for-normal/

I'm not saying it should necessarily trade at 25x, but trading at 7x FCF ex-cash is a bit ridiculous. Not that I'm complaining. I agree with you that it's good if it stays cheap rather than become expensive. It's just quite clear to me that it's not become something is big and very scrutinized that the level of average level of understanding of market participant is high. I wrote about this earlier in this thread, so I won't repeat it, but those who think megacap are necessarily efficiently priced haven't made money on BAC and AIG... Or Apple in the past couple years for that matter.

Blackberry and Nokia sold phones (capable of checking email and a few things, but still phones). Apple sells computers (pocket computers, but still computers). Comparing it to Blackberry and Nokia doesn't make sense. It's a lot easier to make a phone than it is to make a computer (especially the OS and apps ecosystem part). Phones have little barriers to entry and little that makes them sticky. Computers can be very sticky, especially the OS. Ask Microsoft -- even after doing horrible things for over a decade they still are on the majority of PCs...

Q2: http://www.libertyglobal.com/pdf/press-release/Liberty-Global-Earnings-Release-Q2-15-FINAL.pdf

Q2 looking good at first glance: http://www.libertyglobal.com/pdf/press-release/Liberty-Global-Earnings-Release-Q2-15-FINAL.pdf

The Apple case takes care of both things. You don't see the antennas and you the camera is flush with the rest of the case.

A lot of people were hesitant when the 6 came out, but most of those who have upgraded that I've been following (podcasters, friends, etc) find the 5s screen almost unusably small now. What makes a difference, I think, is that the 6 is thinner, so the total volume isn't that much bigger, and that's what you feel when you hold it and carry it on your person. It's not like those thick early phablets by other companies that were just giant bricks. My wife has the 6 with Apple's base silicone-like case (which feels fantastic, no need for leather IMO) and to me that's the perfect balance between size and non-slippery.

Right. What are your thoughts on this? :) Do you see any real opportunities for value creation in LBRD? Or is it just blind faith in Malone? I think there's a difference between having faith in him and blind faith in him :) He's got the track record and he's talking about his strategy enough that the faith doesn't have to be blind ;) The way I see it, if the NAV discount gets too big he'll borrow money cheaply and do buybacks or something like that. I don't expect it to be a problem long term.

The question you need to answer is: Do you believe that Malone can do some value-creating capital allocation/financial engineering on top of CHTR? If not, then you should own CHTR directly if that's what you want to own. A couple months is too short to judge, as you pointed out.

I wasn't planning on buying more, but now I might have to. By my math, the company is now selling at less than 7x TTM FCF ex-cash (with 20% haircut). The last time the stock dropped this much, the company bought back 14bn in 2 weeks. Wouldn't be surprised if something similar happened if this lasts a while.

Charter Q2: http://finance.yahoo.com/news/charter-announces-second-quarter-2015-120000833.html

What do you mean, "missed"? Are you into the analyst game now ;) http://www.transdigm.com/phoenix.zhtml?c=196053&p=irol-newsArticle&ID=2075297

The way I look at it, abject poverty for most people is the default state in history. Most rich people were warlords in one way or another. The people who end up being written about in history book tend not to be part of the 99.99% common people, so don't let that distort your view. Capitalism is a method for increasing productivity (by coordinating unrelated parties, efficiently allocating resources, creating specialization which allows technological progress, etc), which reduces poverty. Blaming capitalism for the people who are still poor is like blaming the scientific method for the things that we don't yet know. Doesn't make much sense. Granted, that doesn't mean that capitalism will accomplish all the goals that we can find worthwhile, but blaming it for poverty is strange. People who are big fans of the welfare state might argue that there isn't enough redistribution and safety nets, but the reason why we can pay for these things and get out of the default state in the first place shouldn't be forgotten or damaged too much.

I like the business model a lot. They only own a few hotels; most are franchised or operated under management contracts. It's a fee based business mostly, collect royalties off the hotels they franchise or manage. So you can imagine, this is a pretty capital light business. The cash is then sent back to shareholders in the forms of dividends and, mostly, share buybacks. The company targets a 3-3.25x leverage ratio to EBITDAR, so for every $1 increase it essentially can (and does) return $3 to shareholders. Planning to return $2 billion this year alone, vs. ~$20 billion market cap. Even though the P/E is high you're getting a large amount of cash returned each year. The debt they use to finance this is very cheap; recently in the 3% range. So they're issuing debt at 3% to buy back stock with an earnings yield of ~4%, that's growing earnings currently at about 20%. It's a smaller position but I was interested enough to buy a starter stake. Very nice ROIC. I remember an earlier incarnation of this being used as an example on Greenblatt's book (when they did the spin-off).

This looks like a cookie-cutter piece. That account has 2,277 published articles, and if you open a few at random, they all look very similar. They probably just plug a bunch of numbers in without any real understanding of the underlying business.. Trying to analyze VRX with GAAP numbers hides more than it reveals. Not worth the time, IMO.

I think they'll probably do fine over time.

You're comparing AGN's USD market cap with VRX's CAD. VRX in USD is 88bn.

What do you like about it so far, and what have you learned about?