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willie2013

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Kraven, first of all nice Arsenio reference, I am showing my approval by doing the old circular fist/"whoot" chant thing. 

 

I may have misread but it seems like you are making a distinction between Schloss' and Tweedy's approach.  What is the distinction?  And what is the distinction between what tweedy was doing buying net nets and simply buying off a screen?

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Kraven, first of all nice Arsenio reference, I am showing my approval by doing the old circular fist/"whoot" chant thing. 

 

I may have misread but it seems like you are making a distinction between Schloss' and Tweedy's approach.  What is the distinction?  And what is the distinction between what tweedy was doing buying net nets and simply buying off a screen?

 

Nicely done on the "whoot" chant.  That made me laugh.  Now just need to figure out how to reference Morton Downey, Jr. and we will be all set.  "Mort! Mort! Mort!" just doesn't seem to cut it.

 

I think the differences between Schloss and TB are more a difference in degree rather than a difference in kind.  That is, I think in many cases Schloss and TB would have been looking at the same things, but I think there was a difference in implementation.  Schloss had many smaller positions, but also some larger ones as well.  Although I think he claimed to go up to 20% I doubt that happened very often if ever.  But 3-5% positions were certainly routine and the top 20 or so was probably 50-60% of the portfolio.  TB on the other hand, at that time, had 1000+ positions.  They would buy anything in whatever size was available. 

 

I think too that Schloss was more concerned about liquidity than TB was.  TB would buy many dark stocks and those that truly traded by appointment. 

 

There are other things too, but the main point is just that they implemented a similar approach differently.

 

In terms of what TB was doing and whether it was different from buying from a screen, I would say back in the day their net net purchases probably were pretty equivalent to buying from a screen.  But that was only about 1/3 of their portfolio.  They also bought unlisted and illiquid stocks, stocks with "hidden" assets, some controlling positions, etc.  But they had parameters for things that they would use.

 

Overall though I think there is generally a view that investors in low p/b stocks are just the functional equivalent of buying from a screen.  That's not what Schloss did.  It's really more of a way of deciding which pool to fish from and then within that pool choosing your fish.

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CorpRaider,

 

Based on your holdings it appears you have an affinity for event-driven situations. Curious what your thoughts are on OXY - recent purchase or long time holding based on the shake-up? Have you looked at HES? If so, how do you think it compares to OXY?

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CorpRaider,

 

Based on your holdings it appears you have an affinity for event-driven situations. Curious what your thoughts are on OXY - recent purchase or long time holding based on the shake-up? Have you looked at HES? If so, how do you think it compares to OXY?

 

Re Oxy:  Yeah not as long-time as I would like, my CB is just below $80.  I'm probably going to hit it pretty hard if it drifts down in that area again on lack of news flow this summer.  I'm sure you've seen the valuations out there including the BofA one pegging break-up value @ ~$160 per share.  they are really singing for those fees.  hah!  I pulled the trigger on it once it looked like Irani would lose the power struggle because 1) Chazen is older and slated to exit after 2014 no matter what; 2) he has a deal maker background.  I need to look at Hess and would happly benefit from any insights you care to share via PM.  I briefly looked at it, maybe a year ago, but I didn't think the activists would be able to do anything because of the family ownership.  I can see how it would be preferable to OXY because of the retail and midstream assets of which OXY has very little to none and it seems like they've got the obvious template in the Marathon transaction. 

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Top 5 holdings - all Canadian

 

Maxim Power – undervalued power producer trading at $3.00 with a sale of U.S. & French power assets in the near term that could bring in up to $3/share cash and eliminate debt. No value for coal assets or NG powered development projects. Total value here probably > $5/share with hard book = $4.50.

 

EGI Financial – trades @ $10.30 with book value $13.60, buyback, underwriting makes money, very conservative mgmt

 

Counsel Corporation – trades @ $1.55 – holdco with 2 main operating companies (one to be spun out to shareholders & the other a fast growing Canadian mortgage broker), legacy real estate & other non core assets to be sold within 12 months, value >$2.75

 

Equal Energy – Oklahoma based E&P listed on TSX & NYSE – activist have pushed for sale of all Cdn properties & now a strategic review. B/S now very solid, initiated a dividend. Highly levered to rise in natural gas/propane pricing. Trades below half of valuation of direct comparable.

 

Sonde Resources – asset rich E&P trading $0.95 in Canada & US – value most likely >$3. Finalization of North African farm out  & Canadian strategic review outcome would be very positive catalyst for shares.

 

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Sculpin, Counsel Corp looks interesting. Is there a write up on it somewhere?

 

 

Top 5 holdings - all Canadian

 

Maxim Power – undervalued power producer trading at $3.00 with a sale of U.S. & French power assets in the near term that could bring in up to $3/share cash and eliminate debt. No value for coal assets or NG powered development projects. Total value here probably > $5/share with hard book = $4.50.

 

EGI Financial – trades @ $10.30 with book value $13.60, buyback, underwriting makes money, very conservative mgmt

 

Counsel Corporation – trades @ $1.55 – holdco with 2 main operating companies (one to be spun out to shareholders & the other a fast growing Canadian mortgage broker), legacy real estate & other non core assets to be sold within 12 months, value >$2.75

 

Equal Energy – Oklahoma based E&P listed on TSX & NYSE – activist have pushed for sale of all Cdn properties & now a strategic review. B/S now very solid, initiated a dividend. Highly levered to rise in natural gas/propane pricing. Trades below half of valuation of direct comparable.

 

Sonde Resources – asset rich E&P trading $0.95 in Canada & US – value most likely >$3. Finalization of North African farm out  & Canadian strategic review outcome would be very positive catalyst for shares.

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  • 2 weeks later...

Just went through a relatively large rebalancing effort. I try to develop most of my investment ideas myself, but will occasionally steal one of I like it enough.

 

DBLTX - 11%

FRFHF - 12.7%

BBRY - 11.3%

MBI - 5.1% - board idea. Thanks guys

SAN - 5.1 %

MURGY - 4.7%

ATUSF - 4.5% - board idea. thanks guys

AAPL - 4.8%

SB - 4.3%

OGZPY - 2.0%

MRVL - 2.0 % - following David Einhorn on this one.

GOOG - 2.0 %

TOT - 2.0%

SLV - 1.75%

AMZN - (3.2%)

Cash - 16.2%

 

Other market exposure through various funds

Stocks - 6.3%

Bonds - 2.7%

Real estate - 2.3%

 

I'm also short calls covering half of my MBI position and long calls for BBRY. Net long exposure through calls is only 1.3%.

 

Totals don't equal a hundred because these were my best estimates off the top of my head.

 

 

 

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  • 1 month later...

Counsel Corporation (CXS-TSX, $2.50)

 

Outperform; Target: $2.80

 

Q2/13: Blowout Quarter As Mortgage Volumes Hit New Record

• CXS reported Q2/13 earnings per share from continuing operations of $0.06 per share, above our $0.04 estimate. While earnings were supported by a $2.9M fair value adjustment of the firm’s Private Equity portfolio, mortgage volumes were off the charts this quarter as the firm had an outstanding quarter. 

• Revenues of $46.4M, up 81% Q/Q and 45% from last year. The results were similarly 48% above our estimate as margin expansion and record volumes of the mortgages sold from the primary Street Capital business shattered our expectations.

• Mortgages sold in the quarter were $2.5B, up 53% from last quarter, and up from $1.6B in the quarter one year ago. While indications of an improving housing market were evident from macro sources and competitor results, the higher than expected growth is a solid indicator of the capability size of Street’s funding providers.

• CXS increased their mortgages under administration to $15B at quarter end, up 13% Q/Q as the company continues to build their customer book in order to line up a steady stream of mortgage renewals in 2014 and beyond.

• Combined with the healthy origination volumes, the company managed to increase their margin (revenues-operating expenses/mortgages sold) to 69 basis points, up from 50 basis points in the prior quarter.

• Conference call is set for 9:00am ET (1-888-231-8191).

Valuation

We value CXS’ ongoing operations by applying a 9 times multiple to our EPS estimate for 2014 of $0.28 per share, generating $2.50 of our target price. We also attribute $0.30 per share to the upcoming divestiture of Counsel RB Capital leading to a target price of $2.80.

Conclusion

A blow out quarter for the company and we will be looking for indications on what factors led to the increase in originations specifically, whether they are market related, or Street specific (i.e. increased funding capacity).

At any rate, the large jump in revenues as a result of increased volumes and margins is a great indication of future growth prospects. We will re-evaluate our forecasts following the conference call today.

 

 

 

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  • 3 months later...

Cash - 23%

 

Bonds - 2%

COLT DEFENSE LLC FIN CORP

 

Utilities - KMI, SO, UTG

Healthcare - ABBV, ABT

Staples - CL, CLX, KO, SYY - LO, MO, PM, RAI

Telecom - CEL, ORAN, T, TEF

 

Discretionary - MCD

Financials - FFH, GS preferreds, NLY, RDN

Industrials

Technology

 

Energy - BP, CVX, RDS.b - Gazprom, Lukoil - ERF, PGH

MLPs - EVEP, KMP, LGCY, PAA, VNR

Materials - SCCO

Precious Metals -TGLDX, GFI, GG, NEM

Real Estate - GPT (calls)

 

Puts (secured)

AIG, BAC, BBRY, NLY, SHLD

 

Thanks,

Lance

 

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Guest Qu1nt3ss0n

AIG

BAC

HSP

Fiat

B&C speakers

Computershare

ARB Corporation

ASX (Australian Stock Exchange)

RMD (Resmed)

SYD (Sydney Airports)

WOW (Woolworths)

MCX (Multi-Commodity Exchange India)

Noida Toll Road (India)

SB

SBERBANK

 

another 10% in mostly gold mining and O&G stocks

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