coffeecaninvestor

+1 from a valuation perspective it makes sense. I was thinking SCHW, but unsure about valuation on that one.

I’ll check teck out. For the most part small cap outperformance Usually lasts 2 years of less in GFC & 2020, but it rips off the bottom. Small cap value didn’t do well at all. Homebuilders look attractive especially NVR it performed better off the bottom and did well long term.

I agree but sizing it right probably helps. I’m always looking for that elusive cheap compounder but clearly it’s probably not the ideal strategy come a market panic since people flock to those. I’ll have to do some back tests to see but I wonder if it makes sense especially in a 401k where most hold ETFs to rebalance to a small cap and small cap value during a big draw down to goose returns with a little less company specific risk. I wonder what the optimal holding time would be.

FICO almost made my list, and probably would if it was a melt down like 07/08 it really got cheap and performed crazy well coming out due to the crazy multiple expansion.

That has been on my mind. Over time I have come around to maybe adding in more cyclical businesses that have good balance sheets. I was thinking of adding things like homebuilders to the list and maybe DOOO to the list. The quality less cyclical names didn’t get quiet cheap enough, and I wasn’t prepared to buy the less quality stuff in 2020. A screen would probably have helped for the really junky stuff.

If you said Johnny blue I’d have been right with you.

I go through this thought exercise and try to keep a list of what companies I would buy if we get another major recession or flash crash type scenario. Most of mine are chronically too expensive so I’ve never owned them. Figured it would be interesting to see what others would buy in that scenario? My list would be CPRT, MA, BRO, HEI, ROL, CSU, BR, MCO.

Starter in CACI

Do you think that is a long term problem for LMT?

LHX has long term compensation EPS and ROIC metrics. They seem pretty adept at capital allocation. Hopefully as their FCF increases they can reduce their share count. I am a fan of GD as well I bought some in 2020 when it looked very attractive.

L3Harris Technologies Reports Strong First Quarter 2024 Results, Increases 2024 Profitability Guidance • Orders of $5.5 billion; book-to-bill of 1.06x • Revenue of $5.2 billion, up 17%, up 5% organically1 • Operating margin of 7.3%; Adjusted segment operating margin of 15.1% • Earnings per share (EPS) of $1.48; Non-GAAP EPS1 of $3.06 • 2024 adjusted segment operating margin 1 guidance increases from ~15% to >15%* • 2024 non-GAAP EPS guidance range increases from $12.40 - $12.80 to $12.70 - $13.05* A little pop out of LHX today... Seems to be heading in the right direction. They seem to be achieving the integration savings from the merger, reduction to debt, and they seem to be optimistic on the demand for Aerojet. They restarted their buy back but only enough to offset dilution. They mentioned they are going to be reducing and simplifying the adjustments to their non-gap numbers. I would like to see more prime contracts, and expansion internationally.

Assuming you have the business quality aspect correct the terminal value of a business will have a much greater impact than your entry multiple unless you are pay some kind of crazy multiple but even then you just need a really long holding period (ie buying MSFT in 2000). Which is why some of WEB's best investments have been modest growers, but for a really long time (GEICO, AXP, KO).

Forward but I would use a conservative estimate of future earnings. The more predictable the industry/company the easier this is.

+1 when I was looking into defense stocks I did this with general dynamics as well if you google it.

It probably took me a decade to figure out not to turn my portfolio over too much, stop trying to invest outside the US just for diversification, holding too much cash trying to time the market, and not paying enough attention to great mgmt/capital allocators. Now I try to find companies that I’d rather never sell, with good mgmt., are in the right industry, and aren’t at extreme valuations.

I enjoy Nelnet’s annual letter.

More FRPH

U Ultimately I was having trouble finding a decent idea for my coffee can portfolio DEO kind of fit the bill but didn't check all the boxes and I had a surplus of funds and needed to find two ideas this year. Usually I am only looking for one idea a year in the coffee can portfolio. A smaller cap company that checks more of the boxes after not having looked at it in a few years seemed more attractive so I decided to swap for it.

Sold DEO. This was a new position so I was able to get out with a small profit. I felt it might not be cheap enough given the low growth, and facing some LT headwinds.

Started a position in NKE, bought OTCM, and added to CPNG.

New CoBF member. Lurked as a guest for awhile but decided to get the membership recently (seemed like a good value investment). Been accumulating some NNI and FRPH.