coffeecaninvestor

Have you ever been tempted to sell. I get it they gave amazing track records, but it seems like it’s getting to the point where they are having to dicier and dicier things to keep it up. But I could be wrong since i haven't followed the industry. It could just be one of those narratives that pops up in every bull market. The tape worm nature of all these investments and how it is starting to work its way into 401ks, life insurance, etc is definitely concerning to me.

Steve Eismanhas has been doing a good job digging into the PE industry. I know we have a lot of holders of APO/KKR/BAM/etc so feel like this might be a decent topic..I feel like the PE and Life insurance industry in general is very hard to wrap my head around given how blackbox the businesses are.. I also wonder if Berkshire is liking their chops if the life insurance industry ever comes to the brink of failure they can jump in at much more attractive rates of return. Either way it was a good podcast episode and work a listen, and if you have any other resources please share.

Sold AJG and FND. Both still trade at premium multiples and just have a weird feeling about the market punishing these compounder’s further.

I’ve started buying OTCM and have doubled my position in FRFHF.

About halfway through only the paranoid survive.So far a good quick read that I think is applicable to what’s going on in a lot of industries currently.

Yeah I checked my library is a small library and doesn’t have access to valueline. I think they might have access to archived WSJ articles but not new issues. The drawbacks of living in a small town.

I’m going to give it a try. I prefer physical reading. I find I get distracted online, and spend way too much time in front of a computer as it is with my day job.

@Parsadwhat papers do you subscribe? i used to read the financial times when I got my student discount but never kept it going although I really enjoyed it. I was thinking of getting WSJ and my local paper. Although WSJ seems pricey after year 1 discount

I am looking for a physical subscription and am considering valueline. I think someone here subscribed to valueline but can’t remember who. Wondering if they can provide a review? Not sure if any alternatives similar to valueline with historical data?

I mainly used it for 20+ year financials and being able to export those to excel. It was a fairly inexpensive. Not sure what everyone else did. I am sure there’s others much more tech savvy that did way more.

Same.. that notice was weird

I am a little more optimistic on the operating business now that Greg is in charge. I also just use BRK to diversify away from buying more S&P500 since I already have so much in my 401k.

Started a position in NTDOY

BAH is down more than 10% today after getting $21M in contracts with the Treasury canceled. My initial thoughts were to buy since the contract is so small relative to the market cap losses, and they just reported a little more optimistic outlook for 2026, but It worries me a little longer if BAH may be in the penalty box in a really tough environment on the Civil side of their business. https://www.cnbc.com/2026/01/26/trump-tax-records-treasury-cancels-booz-allen-contracts.html https://investors.boozallen.com/financial-information#block--views-blockwidget-bundled-content-block-1--5871

Yes but in the long term are they saturated and in decline or do they still have room to grow. I guess I am betting the latter, and I don’t think you even need double digit growth just grow earnings 7%/year via volume, price, and buybacks over the next 5 years.

Yes in the short term they have been challenged but if they earn $11 EPS that’s 15x earnings.. theres not a lot of growth embedded in that multiple. It looks like inventories have stabilized relative to their revenue growth and they have been able to raise prices without much issue.

The core brands have volume growth. It’s really been wine and spirits that has really been the issue. If they focus on he premium beer I think results can improve and can resume taking market share. The overall results don’t look great lately due to the write offs and divestures but I think a lot of that is done with. The latest quarter seemed like it’s heading in the right direction. They are also facing some headwinds with higher aluminum prices and tariffs. I think those are manageable. STZ has unique brand names and does really well in the premium niche. I know people that drink modello and won’t drink anything else. I don’t really care about short interest.. they might be short based on different investment horizons, or for some other reason. If people weren’t bearish then there wouldn’t be an opportunity to buy a capital light growth company at a discount. There is a clear housing shortage and so I think FND will have a tailwind whenever the housing market unfreezes. All the while I have the potential to have multiple “engines” of growth from new store openings, margin expansion from operating leverage, and earnings growth from new housing demand, and multiple expansion. FND has a low cost business model in the flooring niche and I think can continue to take share. I think the business is fine and durable it’s just a shitty time for housing, but I don’t think you want to buy a cyclical industry when things are firing on all cylinders you buy when it’s slow. But that’s just my view on it we will see how it plays out. I think these businesses are easier to handicap than software or payment companies , and cheaper than some of the growth stocks that I think a more fairly priced.

Here are the companies that made the cut, and increased in position size. Berkshire Fairfax NNI AJG STZ FND BAH

I’m going to add kids toys to this.

Personally I would be willing to let positions grow to this size of a portfolio, but having 3-5 positions at cost was a little difficult for me mentally.

Taking my own advice and moving back to a portfolio of 10-15 stocks by eliminating the following holdings. UNH & ELV - my income is tied to the sector so having my investments in the same sector is probably not prudent. I also think there is a chance the industry has been somewhat impaired. The Eisman Playbook podcast had a good episode on healthcare recently that made me rethink some things about the sector in general. ADBE & CNSWF - I think these probably end up doing well, and as a sector look cheap, but software is not my wheel house so I felt comfortable with a small bet, but not if I am going to increase my position sizing due to limiting the number of positions I want to hold. KRE - was more a sector bet on the consolidation of the industry, but not an investment I am comfortable holding long term given the cyclical nature of banks. PYPL - This was also more of a statistically cheap bet where I was betting on a sentiment change. They have a questionable position in the payments industry so likely not a long term holding for me. CHD - I think this one does fine, but if I have to own less stocks I want to be more picky about the quality and long term growth potential of the investments.

I’m in a similar life position so I’m curious to see what others think. I’ve recently moved to 20-25 positions, but am quickly learning that the amount of time I have to research that many investments deeply is impossible with how much free time I have. I plan to over time reduce that number some. In my opinion I think the sweet spot is probably 10-15 positions and spending more time researching new investments and less time following stocks you already own. Which means focusing on good businesses you feel like you can hold for a long time is probably a must.

Sold UNF for 20% gain wasn't able to accumulate a full position before the latest bid from Cintas. I don’t want to add at $200+ and it looks like the bid might be rejected so I am going to move on since it’s not a long term hold for me.

From a health insurance perspective (which I have experience) I think from a carrier perspective low hanging fruit is on the middle market size business where the data inputs are really limited and uniform. I think it is begging for the process to be streamlined, and to remove human interaction where so much is of business is lost, and time wasted. Some of the larger brokers like Mercer and Aon I think are probably trying to do their own thing. They have their own websites that we have to respond to large RFP's in that aggregate data. I am sure on their end they want to be able to analyze competing bids faster using AI, but it is clunky from an end user standpoint, and not sure it has an AI functionality yet.

Spent some time over the weekend thinking how to put some of my cash to work. Decided to pull the trigger and add significantly to BRK, Fairfax, AJG, and NNI. I am down to around ~27% cash. I think these companies all have good and trust worthy management, have the ability to compound for a long time with little risk of a catastrophic blow up, and have demonstrated the ability to generate above average shareholder returns through smart capital allocation. I think there are some really cheap things out there that may outperform these, but I have more confidence in these companies, and am willing to hold them through ups and downs which I think is important with markets at all time highs, but you never know this thing could keep churning higher. At these prices I think you are likely just getting the return the business generates which I think will be satisfactory, but not sure about any multiple expansion unless they hit a home run on some kind of new business line, investment, etc.