accutronman Posted September 23, 2014 Author Share Posted September 23, 2014 BTW, good analysis on the rights offering: http://finance.yahoo.com/news/biglari-holdings-rights-offering-seems-173037263.html Link to comment Share on other sites More sharing options...
giofranchi Posted September 25, 2014 Share Posted September 25, 2014 For those shareholders who subscribed, what was your fill rate in the oversubscription allotment? I was filled at a rate of 6.5%. It is 7.1% for me. Less than I had hoped for! ::) Gio Link to comment Share on other sites More sharing options...
giofranchi Posted October 16, 2014 Share Posted October 16, 2014 Today BH has a market cap of $665 million. Its investment in CBRL alone is worth $500 million. ??? Gio Link to comment Share on other sites More sharing options...
adesigar Posted October 16, 2014 Share Posted October 16, 2014 Today BH has a market cap of $665 million. Its investment is CBRL alone is worth $500 million. ??? Gio I see BH market cap as 550 Million with 20%of CBRL worth 500 million that's 50 million for the rest. Im not in BH nor plan to be because of .... But for people who like BH seems like a nice point to buy/add. Could go lower if market drops tho. BTW why does it have 315 Million in Long Term debt? To lock in cheap money? When is it due? Isnt it risky buying stock with debt? Link to comment Share on other sites More sharing options...
giofranchi Posted October 16, 2014 Share Posted October 16, 2014 I see BH market cap as 550 Million with 20%of CBRL worth 500 million That is because probably what you are watching is not counting the new shares issued through the rights offering yet. True market cap is $665 million. At the end of Q2 2014 BH had $215 million in long-term debt on the balance sheet with $112 million of cash. After the rights offering cash is around $200 million. Gio Link to comment Share on other sites More sharing options...
timmerjames Posted October 16, 2014 Share Posted October 16, 2014 The crazy thing is they are getting $19M per year in dividends from CBRL. After the $86M in rights offering, the war chest is probably close to $200M. Looking forward to see what the next purchase is. I hope it is a wholly owned company instead of interest in a public company. Link to comment Share on other sites More sharing options...
valueyoda Posted October 27, 2014 Share Posted October 27, 2014 Biglari is now really getting attractive, after the recent run-up in CBRL. BH's stake in CBRL is now worth $530mn before capital gain taxes. Hopefully, Biglari has allocated a substantial portion of its recent cash hoard during the meltdown this month. Link to comment Share on other sites More sharing options...
OracleofCarolina Posted October 28, 2014 Share Posted October 28, 2014 Looks like a fun time at the new Santa Monica Steak N Shake http://instagram.com/p/utkq7ase4S/ Link to comment Share on other sites More sharing options...
fareastwarriors Posted October 29, 2014 Share Posted October 29, 2014 The Humane Society Takes Its Steak 'n Shake Fight to the Shareholders http://www.businessweek.com/articles/2014-10-27/humane-society-takes-its-fight-with-steak-n-shake-to-investors#r=nav-fs Link to comment Share on other sites More sharing options...
gg Posted October 29, 2014 Share Posted October 29, 2014 Looks like a fun time at the new Santa Monica Steak N Shake http://instagram.com/p/utkq7ase4S/ Video is helpful for those wondering about the synergies between selling hamburgers and the Maxim Brand Link to comment Share on other sites More sharing options...
giofranchi Posted October 29, 2014 Share Posted October 29, 2014 Video is helpful for those wondering about the synergies between selling hamburgers and the Maxim Brand ;)!! Gio Link to comment Share on other sites More sharing options...
cheerlee Posted November 5, 2014 Share Posted November 5, 2014 Gio Hi, Gio, My opinion is similar to you up to now, support and trust Biglari. But I didn't attend annual meeting, do you think Biglari can talk their mistakes freely? and not hiding bad news from outsiders? Thanks, Link to comment Share on other sites More sharing options...
OracleofCarolina Posted November 5, 2014 Share Posted November 5, 2014 A little news on the Maxim deal that fell through before Biglari purchased them. http://mobile.reuters.com/article/idUSL1N0SV1YQ20141105?irpc=932 Link to comment Share on other sites More sharing options...
muscleman Posted November 6, 2014 Share Posted November 6, 2014 Thanks for the discussions. I sold my TRPE shares to buy BH today. I think BH is more undervalued than TPRE at this moment, and it is easier to analyze, and the performance fee is much smaller than TPRE. It seems like Biglari is very good at restaurants investments. I know a local restaurant that's becoming popular. This restaurant started with 1 store, and waiting time is usually 30 minutes or more. They expanded to another location last year for $200k. I heard they got $200k earnings that same year. Basically it is a 100% return of equity. It is considering to expand more right now. I wonder if there is a way for me to send this idea to Biglari himself? Maybe he could take a look and talk to the restaurant's owner? Link to comment Share on other sites More sharing options...
mateo999 Posted November 6, 2014 Share Posted November 6, 2014 FWIW, I've spent some time speaking to a number of SNS franchisees. Not one of them had a single good thing to say about Sardar. They tell me he's arrogant and illogical, and that his control over pricing while dictating suppliers (CYGNA a sub of SYS) has effectively been killing store level profitability. A recurring theme was "$3.99 meals and kids eating free made a lot of sense during the financial crisis. It doesn't make much sense when people can't find a table at my store. I'm literally using the same exact tomatoes as the steakhouse down the street selling $15 salads.". A number of them are in the process of backing out of new store commitments, and a few asked me to stay in touch in case I spoke to someone interested in buying franchised location. There was also quite a bit of mudslinging (everything from alleged accounting shenanigans at BH, to Sardar keeping company with Russian prostitutes). I also heard second-hand rumors about the UAE rollout essentially no longer happening due to Sardar's ego. I have no idea if this is all a brilliant attempt to push SNS franchisees to the breaking point, at which point BH can acquire locations on the cheap. However, I much prefer the capital light strategy of growing through the franchise model. I'm not saying this stock doesn't work from here, but I was significantly discouraged by what I heard about its jockey. Link to comment Share on other sites More sharing options...
muscleman Posted November 7, 2014 Share Posted November 7, 2014 FWIW, I've spent some time speaking to a number of SNS franchisees. Not one of them had a single good thing to say about Sardar. They tell me he's arrogant and illogical, and that his control over pricing while dictating suppliers (CYGNA a sub of SYS) has effectively been killing store level profitability. A recurring theme was "$3.99 meals and kids eating free made a lot of sense during the financial crisis. It doesn't make much sense when people can't find a table at my store. I'm literally using the same exact tomatoes as the steakhouse down the street selling $15 salads.". A number of them are in the process of backing out of new store commitments, and a few asked me to stay in touch in case I spoke to someone interested in buying franchised location. There was also quite a bit of mudslinging (everything from alleged accounting shenanigans at BH, to Sardar keeping company with Russian prostitutes). I also heard second-hand rumors about the UAE rollout essentially no longer happening due to Sardar's ego. I have no idea if this is all a brilliant attempt to push SNS franchisees to the breaking point, at which point BH can acquire locations on the cheap. However, I much prefer the capital light strategy of growing through the franchise model. I'm not saying this stock doesn't work from here, but I was significantly discouraged by what I heard about its jockey. What accounting shenanigans at BH are you referring to? Link to comment Share on other sites More sharing options...
mateo999 Posted November 7, 2014 Share Posted November 7, 2014 The details regarding the alleged (and mind you, not alleged by me) accounting "shenanigans" were very thin but supposedly had to do with shifting costs around from SNS to Corporate to make SNS seem more profitable. This person also thought the company was using outdated figures in its SNS Franchise Disclosure Document. This person hated Sardar, so I'd take it with a grain of salt. My point wasn't "there might be accounting irregularities at BH" as much as: SNS franchisees I spoke to are growing increasingly disenfranchised by Sardar and feel he's essentially 'biting the hand that feeds him'. Over time many have grown to have utter disdain for him, and it's gotten to a point where a few felt compelled to fling unsubstantiated rumors about Russian hookers and SEC violations to a complete stranger." Link to comment Share on other sites More sharing options...
giofranchi Posted November 7, 2014 Share Posted November 7, 2014 My point wasn't "there might be accounting irregularities at BH" as much as: SNS franchisees I spoke to are growing increasingly disenfranchised by Sardar and feel he's essentially 'biting the hand that feeds him'. Over time many have grown to have utter disdain for him, and it's gotten to a point where a few felt compelled to fling unsubstantiated rumors about Russian hookers and SEC violations to a complete stranger." I can only say I don’t invest basing my judgment on gossip… If it is gossip I am interested in, I buy MAXIM… ;D Btw, those are the very same things employees say about Pearson at VRX or about 3G whenever they put their hands on a new company! The very same things they used to say about Malone too... A businessman who is relentless in cutting costs will always be bound to attract much criticism… and even hate!... there is no getting around this inevitable truth! Anyway, ask Buffett what he thinks about Lemann’s business acumen… or ask Ubben what he thinks about Pearson’s business acumen… ;) Gio Link to comment Share on other sites More sharing options...
giofranchi Posted November 7, 2014 Share Posted November 7, 2014 do you think Biglari can talk their mistakes freely? and not hiding bad news from outsiders? I don’t know… But I guess we will soon find out: in December the 2014AL will be released, and there is no denying 2014 has been a year in which BVPS has essentially stagnated… It will be interesting to read Biglari’s comments over the 2014 poor performance! ;) Gio Link to comment Share on other sites More sharing options...
mateo999 Posted November 7, 2014 Share Posted November 7, 2014 gio, i don't disagree with what you've said. And I don't invest on gossip either. But a franchisee is very different from an employee. simply put, franchisees have been telling me they can't make a living any longer. I also spoke to would-be franchisees that walked away from the process after making a few due diligence phone calls to other franchisees. If true, this has significant implication for SNS' franchise roll out plans. Link to comment Share on other sites More sharing options...
muscleman Posted November 7, 2014 Share Posted November 7, 2014 The details regarding the alleged (and mind you, not alleged by me) accounting "shenanigans" were very thin but supposedly had to do with shifting costs around from SNS to Corporate to make SNS seem more profitable. This person also thought the company was using outdated figures in its SNS Franchise Disclosure Document. This person hated Sardar, so I'd take it with a grain of salt. My point wasn't "there might be accounting irregularities at BH" as much as: SNS franchisees I spoke to are growing increasingly disenfranchised by Sardar and feel he's essentially 'biting the hand that feeds him'. Over time many have grown to have utter disdain for him, and it's gotten to a point where a few felt compelled to fling unsubstantiated rumors about Russian hookers and SEC violations to a complete stranger." I would like to do a deep dive on any possible accounting issues, just to be safe. Would you please send me the links of his posts about these issues? They could either be gossips or tip of the ice berg. Better to be safe than sorry. Regarding the complaints.... It is quite common. A large number of employees hate Jeff Bezo and said he is too cheap on everything. I heard the same complaints for VRX and other companies. Link to comment Share on other sites More sharing options...
giofranchi Posted November 7, 2014 Share Posted November 7, 2014 I also spoke to would-be franchisees that walked away from the process after making a few due diligence phone calls to other franchisees. If true, this has significant implication for SNS' franchise roll out plans. I agree. That would be a problem. But Biglari has talked repeatedly about his strategy to enhance the franchise business, in the US and abroad! Therefore, if his relentlessness about cutting costs is pushing things too far, and risks marring the franchise business in which Biglari has invested a lot in recent years (at the expense of reported earnings! And therefore at the expense of BVPS growth… and therefore at the expense of his own bonus!)… I think, or at least I hope, sooner or later he will take notice and change accordingly. We will see! Gio Link to comment Share on other sites More sharing options...
muscleman Posted November 7, 2014 Share Posted November 7, 2014 In his 2013 letter, "in July 2013 we adapted our structure in an important and vital way: BH transferred most of its marketable securities to The Lion Fund, L.P. and The Lion Fund II, L.P. (together referred to as The Lion Fund), managed by Biglari Capital Corp., the general partner." http://www.biglariholdings.com/letters/2013.pdf How does this work? Will the Lion fund charge the typical 2/20 fee and then on top of that, Baglari himself charges the incentive bonus based on book value growth once again? That would be a double charge if that's the case. Link to comment Share on other sites More sharing options...
giofranchi Posted November 7, 2014 Share Posted November 7, 2014 Will the Lion fund charge the typical 2/20 fee and then on top of that, Baglari himself charges the incentive bonus based on book value growth once again? That would be a double charge if that's the case. No, Biglari will be compensated based on the growth in BVPS due solely to operating earnings, The Lion Fund compensation instead will be based solely upon investment results. What I don’t know is how much The Lion Fund will be paid… Gio Link to comment Share on other sites More sharing options...
mateo999 Posted November 7, 2014 Share Posted November 7, 2014 I would like to do a deep dive on any possible accounting issues, just to be safe. Would you please send me the links of his posts about these issues? They could either be gossips or tip of the ice berg. Better to be safe than sorry. Regarding the complaints.... It is quite common. A large number of employees hate Jeff Bezo and said he is too cheap on everything. I heard the same complaints for VRX and other companies. It was during a phone call, so nothing in writing to speak of. In addition, there was nothing overly specific alleged. Just that the guy (who happened to be a CPA) felt SNS costs were being allocated to BH corporate. Link to comment Share on other sites More sharing options...
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