Hielko
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Posts posted by Hielko
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Or what about Apple. Think there are really a lot of examples
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Is the CPA a valuable designation re: investing? Buffett always talks about the importance of accounting, but is earning the CPA necessary? Can't I learn as I go along by reading regulatory filings?
My thinking is that if there are particular aspects of a financial statement that I don't understand, I can always look up the rules (i.e. CPA handbook, etc.). I have 3 years of experience in Big 4 audit, which has built a strong foundation of accounting knowledge. My original intent for joining Big 4 was to learn accounting, but earning the CPA will likely take me another 2 years.
I'm not concerned about the time/effort required, but if I'm going to embark on an arduous journey and take time away from finding bargains, I want to know that there's light at the end of the tunnel. Any thoughts/opinions are welcome.
How has everyone else on this forum learned accounting over the years?
I would guess that you probably already know more about accounting than you need for investing.
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I have seen this before!
Adobe did it after their big Marketo acquisition. When one company acquires another company that has a lot of deferred revenue (usually subscription revenue), you’ll often see an accounting phenomenon where a portion of the acquired company’s revenue magically “disappears” post acquisition, coupled with a revenue writedown of the acquired company’s deferred revenue balance sheet asset. A somewhat recent example of this is Adobe’s recent acquisitions of Marketo and Magento, which will result in $75 million worth of deferred revenue write-downs in 2019, a 0.67% hit to Adobe’s $11.15 billion 2019 revenue estimate.
The reason why these deferred revenues are typically written down is that in a merger all of the acquired company’s assets get revalued “at fair value,” with each asset’s definition of fair value based on specific GAAP accounting rules. With respect to deferred revenue, GAAP accounting rules specify that it get revalued based on the estimated actual cost of the performance obligation plus an appropriate profit margin. With software, most of the cost to develop the software and then support the customer has been done either before the sale or very early on in the service contract life, and the remaining life of the service contract is usually pure gravy, with little associated cost. When this remaining deferred revenue is revalued based on actual cost plus a margin, it almost invariably results in a non-cash deferred revenue write-down, recognized in the year that the revenue would have recognized.
Since many service contracts are a year in length, a typical thing you’ll see is the combined company’s revenue go down compared to the sum total of the two companies’ separate, pre-merger revenue streams the first year, and then pop back the next year when new year-long service contracts are written post merger. However, if the acquired company’s service contracts were longer than a year, this non-cash reduction in revenue could extend out further than a year.
Looking at the appendix of the slide deck, it looks like the non-GAAP revenue is related to acquisition-based deferred revenue adjustments. As long as the acquiring company doesn't lose a large chunk of the subscribers it acquired, I think looking at the non-GAAP revenue figures is useful.
Mike
Who would have thought, it actually makes sense! :)
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Hi guys, whatever way we calculate ROIC, if we take the depreciated PP&E value (and all else equal) we will get better ROIC's the older the PP&E gets, right?
Shouldn't we use the original (or un-depreciated) value of the PP&E?
Thank you
No. Because you are also reducing the return number of the ROIC by the depreciation. If you use the return number that contains depreciation and then asset value that doesn't you just get something weird.
And sure, these calculations are always imperfect. Straight line (or other method) depreciation is in the end always an accounting construct, not reality.
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Their daily new cases have been stabilizing for a week now, and I think their testing capacity has been going up, so it's possible they are now finding a higher percentage of the infected (so effectively there is already a decline). Their numbers aren't pretty, but for sure a lot better than it could have been with exponential growth.
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I’ve spent a few hours trying to find statistics for different countries. What I’ve tried to find is:
1. Countries that have tested a lot. Preferably over 1% of the population.
2. Cases (infections)
3. Deaths
I’ve noticed a huge problem - it’s super difficult getting the information on how many tests countries have done. Everyone seems to report on infections and deaths. I’m no expert, but you’d think reporting on the denominator would be of vital information!
Any recommended site that tracks: countries; number of tests done; infections; deaths?
Norway has tested over 1,4% of it’s population:
Tests: 73.089
Cases: 3.346
Deaths: 14
Mortality rate: 0,42%
Still very hard to interpreted that data. Because presumably a lot of the reported cases are people who just got infected, just got sick, are just admitted to the hospital etc. Only in 3 or 4 weeks time you will know how many deaths there are from the current sample of 3346 cases. But that's something you can only track if you get case by case information, and you won't have that.
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I'm EXTREMELY disappointed that it seems like there will be an easy way to get liquidity.
I really was hoping for a cool adventure where you needed to go to Cameroon to deliver physical certificates in person, getting paid cash in central African franc. Getting some shady local dealer to exchange it to dollars etc. So much potential!
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I think switching to a different broker will not solve your problems.
Tender offers made outside the US are very often explicitly not made to residents of the US because small companies can't afford to comply with US regulations (Canada, Japan, Australia are other countries I often see explicitly excluded). I took a look at this tender offer, and while it doesn't explicitly exclude US residents it states that it is made only in France, from google translate:
This Project Information Memorandum is not intended to be broadcast in a country other than France.The Offer has been nor will be registered or approved outside of France. Holders of shares outside of France can not
participate in the Offer unless local law to which they are subject permits. Indeed, the distribution of this document, the Offer,
the acceptance of the offer and delivery of the shares may be subject to specific regulations or restrictions in certain
countries.
Odds that any broker is willing to submit your shares and that the company is willing to purchase your shares: 0.0001% (okay, that might be a bit too pessimistic)
Besides that, writser is making some good points.
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More like tiny company problems... and some ridiculous restrictions (even more than the other ones) on stock where I own just a handful of shares.
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I have messages from David, Jozef, John and Joe. Wonder how many people they have working on this...
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Interesting to see that results on COBF are sort of distributed normally (as expected), but that the mean/average of this years returns seems to be significantly below the index with the most people having a 20-25% outcome, not one, but two steps below the option that includes the index return.
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I wouldn't be too concerned, at least not about the company just keeping your money. The tax issue is probably real, CVRs aren't a common structure so it's very probably there is some kind of disagreement with on how to treat this payment. And Israel is already one of the worst countries with regards to paperwork requirements with merger payments. So if they can't agree quickly, totally possible that this can drag out for a couple of years. Hope all the possibly lawyer and accountant costs aren't deducted from the CVR payment ;)
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if any private entity bailed out the banks or Fannie Mae they would have taken ownership of the company outright
But if any private entity would have bailed out banks or Fannie Mae they would have required share holder approval and/or go through a bankruptcy process where bond holders, perf holders and equity would have had some say in the outcome.
Where you alive during the Great Recession? (Jk) Bondholders would have accepted massive haircuts would have happily accepted a expedited bankruptcy process and equity holders would surely have no say (and wiped clean) in the bankruptcy of banks nor Fannie and Freddie. No way anyone would have argued with a white knight as people thought like the world was ending. Instead bondholders were made whole and equity holders still maintained some ownership share.
During the GFC I was happily playing poker without looking at the stock market at all ;).
But sure, probably plenty of bond holders would have accepted a big haircut at that time and be happy that they got anything at all. But the thing is, they didn't go bankrupt. And there would be no way of telling what would have happened if they did. There is no such thing as an expedited bankruptcy process, and if you look at how long for example the process of the Lehman Brothers bankruptcy is taking (it is still in progress as far as I know!!!) it is certainly possible that by the time they started selling assets the value of those assets recovered.
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if any private entity bailed out the banks or Fannie Mae they would have taken ownership of the company outright
But if any private entity would have bailed out banks or Fannie Mae they would have required share holder approval and/or go through a bankruptcy process where bond holders, perf holders and equity would have had some say in the outcome.
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For example, I've always been amazed. Everywhere I travel in Europe, North America, Asia the price per litre of gas for your car is approximately the same. Plus-minus but about the same..Regardless if the country is poor or rich and if the cost is more onerous in the poorer ones. Yet you take something like cable broadband and there I see price differences far greater than oil! For example, in Ukraine or Romania I can get 4g lte unlimited for under $10 USD, sometimes $5 USD. In Canada or USA, the same thing would cost say $30 to $40 usd. There has to be something going on. Is oil a better business because everywhere you sell it you get the same price? Or is cable just a horrible subsidized non profitable business in some places vs others? And why the difference in outcomes for various lines of businesses? Is government the reason or something else?
I don't think you paid attention if you think a litre of gas is roughly equally priced everywhere in the world, see for example here for a nice comparison: https://www.bloomberg.com/graphics/gas-prices/#20193:United-States:USD:g In general, some oil producing countries have subsidies and as a result have extremely cheap gasoline. The US isn't that cheap, but has basically no taxes compared to most european countries where gasoline prices are easily 2x those of the US.
About mobile internet, in most countries 4G-provides have to pay to use spectrum. In richer countries they correctly figure that most people are willing and capable of paying more, so they can also offer more money for spectrum. So it's some kind of (indirect) tax. Besides that, there can be large differences in population density, terrain, and many other factors that can have a large impact on the price.
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I won't stay at an airBnB or VRBO rental where the owner has ever cancelled a reservation in the past. Who knows, maybe the cancellation was legitimate and I am overreacting, but you are playing such a weak hand when a host cancels and you're stuck. I've seen rentals offered with 10 reviews and 2 mentions of host cancellations - ain't no way I'm signing up, you know they will sell you out for a better private offer in a heartbeat.
Whatever the reason, a host that cancels is unreliable and I would never book. But if someone gets a couple of positive reviews, then you book, and then the cancellations that showing in their reviews, nothing you can do...
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The court decision is outrageous as her swaps were done before the rules banning it were active. In non-banana jurisdictions there's a little thing called legal certainty.
Legal certainty is not a thing that can exist, because there are always ambiguities in the interpretation of rules and facts.
Besides that, it sounds to me that she was not only quite obviously breaking the "spirit" of the law as it was written at the time, but also the actual letter of the law. That's why she lost in court, not because the rules were changed at a later point. They changed the law to make it crystal clear that this was not allowed, but that wasn't actually needed. She thought she was smart by exploiting a loophole in the pricing mechanism her broker used for off-market swaps, but just because a broker makes something possible, it doesn't make it legal.
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Are you sure you are looking at real-time bid/ask quotes? Yahoo Finance is 20m delay I think?
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The view that things are set in stone in your genes when you are born is scientifically outdated. Google: Epigenetics
So you can find this kind of complex behavior basically with everything.
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Usually the author is at the same time also the founder, chief investment officer of blabla global capital that is managing his own lunch money...
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I think in Japan you should try to have both, at least that is my strategy. But something that is not just a net-net, but also has a low P/E at the same time. But if you buy something that is nicely growing at has a low P/E ratio, why not? As long as it's very cheap :)
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It looks like 8191:JP Hikari Furniture is going private at 6710 yen per share, which is about a 34% return on the purchase price in a bit over a year, at least if I'm reading the filing in translation correctly
Looks like it was delisted a couple of months ago already?
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This guy did 3 remarkable things:
1) Took a large fortune and put it all in stocks.
2) Made this investment in 1980 when just about nobody wanted to own stocks.
3) Held on for decades.
I'd guess that few wealthy people in 1980 did even one of those things, he did all three. He didn't need to match the index to be a star, assuming he didn't as some suspect.
We don't know #1. We don't know how much he put in stocks and how much he put in other things and what his allocation has been over time, whether as his equities went up he kept reducing his exposure, whether he changed his mind at various point and sometimes was 50/50, then 75-25, then 25-75, etc. We don't even know how much he really had at various points of his life except at the beginning and today.
If he did that wouldn't that just make him exactly the below average investor some suspect him to be?
But #2 and #3 are impressive. In hindsight it seems like it was obvious, but the reason why P/E were so low back then is because everybody hated stocks after a decade of high inflation and high interest rates and crappy economy and various shocks, and assumed it would continue forward, and there certainly wasn't the info that we have today about stocks and investing back then, especially for someone who wasn't even working in the financial industry and approached investing as an amateur.Impressive, or just lucky? Or impressively lucky?
rebates on foreign dividends with double taxation treaties
in General Discussion
Posted
I have never reclaimed taxes in France, but I believe that one is doable. See here for the form that needs to be completed: https://www.impots.gouv.fr/portail/files/formulaires/5001-sd/2018/5001-sd_2281.pdf My Dutch broker now even offers support to apply for lower withholding taxes in advance for French companies, similar to what is possible with the W8-BEN in the US. But think they are the exception, and most brokers don't offer this.
To reclaim taxes I believe you still need cooperation from your broker since they need to sign to form or provide an official dividend statement or something along those lines. Then you probably need to get the form signed by your local tax authority as well (to confirm that you are for tax purposes a resident of your country) and then you can send it to France and wait... (I have done successful tax reclaims in Sweden and Belgium, no experience with other countries).