plato1976

http://online.barrons.com/article/SB50001424053111904462504579139341318918238.html?mod=BOL_twm_fs#articleTabs_article%3D0 I couldn't convince myself to buy KO I have heard of Yacktman 's argument for a while Basically he's saying the forward yield is free cash yield + growth + inflation So take KO as an example, currently its free cash flow yield is close to 4.5%, suppose we have 2% growth and 2% inflation we should have a forward yield around 8.5% To me, the free cash flow yield of 4.5% is really not high enough to convince myself into buy this one, when other relatively low quality stocks still can generate 20% (see packer's ideas...) My bar for these absolutely high quality ones is a forward yield of low teen at least... What do you guys think ?

5-10x !!! must be a micro-cap No, but it's big. I didn't go all in with BAC in my personal portfolio, but close. I've also found something else that I'm really intrigued by and think it could be even better...5-10 bagger in a relatively short period of time. You guys would be surprised! Has risk like anything, but I'm trying to take a big position. What else am I going to do with all of this cash! ;D Cheers!

one quick question, did Mr. Lewis warned the last crisis before its happening (or just reported it around/after the meltdown)

The wage has not been risen at 7% a year either in the past 20 years... I agree with a lot of what you say, BUT do you think property in CA, especially L.A will continue to appreciate 7% a year for the next 20 years? If so, that $1MM house today will be something like $4MM 18-20 years from now? Wages have not been going up that fast... Who is going to be able to pay $4MM for a somewhat above average house 20 years from now? Heck, I am amazed there are enough people willing/able to pay $1MM for a house now... In certain areas of the country, you can get a very, very nice house for $100k or $150k. At some point, I would think business/buyers will start moving away from the high cost areas. Granted, living in LA is better than living in Indiana or Michigan...but at some point the cost simply is not worth it... You are starting to see this in the legal profession...work is being outsourced out of NYC and DC to Detroit and Minneapolis. You can get plenty of lawyers willing to work for $25/hour in the midwest....so work is moving out of the high cost areas. I think this trend will accelerate in the future.

yeah, it's really hard to beat real estate investment if a region can appreciate at 7% annually for decades. At early stage when leverage is 5% this translates into 30%+ annual return, plus some rental income. For individual investors, real estate investment also has some tax benefits (esp for primary residence).

If the managers are consistent reckless risk takers and don't have enough skin in the game; I can imagine no matter how cheap it is the risk here is huge

In fact, I did some analysis for all picks before he mentioned "someone got it": Those with "X" can be excluded, I think. The one with "?" before it can be a likely candidate. It does look like GVC is the one ! I set up a few criteria like "declined this year and better declining in Aug and early Sep; not a big cap; valuation and corp economics disconnection; and so on" *********************************************************************** XXX JCP XXX SHOS One year ago at the same price XX SD XXX RFP ? BTH Disconnection between economy and valuation ? doesn't look like X AAPL XX LVLT XX RICK ? Callinan Royalties XXX Enbridge ? EBIX Parsad once showed doubt, so it's very unlikely, but anything is possible and maybe he changed his mind ... ? SCU XX RFC ? GLN XX PGH X BP X MSFT XX WDFC ? ARO XXX BPY ? GVC ********************************************************************************** If that's what you think...so be it. Cheers! Not really, but most seem to believe it's Glacier Media http://finance.yahoo.com/q?s=GVC.TO%2C+&ql=0

btw, did we settle down on the conclusion which stock is *the* so called greatest opp here ? :) If that's what you think...so be it. Cheers!

:) is today THE day to unload ?

A few years ago I bought quite some resource stocks at the cycle peak ; I thought the PE was really low and then 2008 comes... I also bought some radio stocks with high leverage and one yellow page company - those were in secular decline and high leverage killed equity - most of them went to zero essentially Another mistake is I was too conservative at 2009 low - looking back I still don't think it's a mistake to prepare for a depression - but obviously I should buy some performing loan in 2008 (chinese chem-petro loan was generating 20%+ at a time in 2008); I may should have bought some really high quality stock without much debt back then.

When the whole sector is undervalued the situation is not that bad, if one extremely undervalued corp is acquired below intrinsic value (but still above the market price), you can take the money and switch to another corp in the same sector (hopefully similarly undervalued, or at least at a similar valuation as the buy-out price b/c buy-out will use sector valuation as a reference, usually). The situation is esp bad when your corp is really unique... Anyway, that's why I think we should give berkshire or maybe fairfax some premium :) The problem is when the owners are the one buying out everyone else.. This is exactly why Berkshire is unique. The owner's manual (and their behavior) clearly puts your ownership interest at the same level as all other owners. You are the owner. Period. Berkshire may do very well or poorly in the future but the one thing you don't worry about is getting "bought out". As long as this culture is maintained, Berkshire will do fine for investors (owners), even past Warren's tenure.

Then there's management leveraged buy-out Say management holds 30% which is a significant stake, but if they are motivated to buy the remaining 70% at low price ... I see these kind of things as a big risk for our small minor shareholders

This risk is stopping me from allocating a significant part of my portfolio into some small cap names; the question is how to evaluate such risk For mega cap like apple or BAC it's unlikely to happen, and I feel comfortable to invest a big portion of my money into them (20% or 30% or even more) when I think the timing and valuation is right. But a small cap (100M to 1B), even if your entry is significantly below the intrinsic value, someone can still acquire it way below your entry and make your investment a permanent loss. I am not even talking about RIMM or DELL which are not that small... Maybe you can look into management holding ratio but then there is a possibility of LBO (esp when the corp is cash rich). Any suggestion how to evaluate such risk ?

I was suspecting it's fiat ; but the 40x return still "scared" me don't think fiat will be a 40x (from $5) - in the optimal case it may be a 10x in a few years Fiat. The 7-8 commercials, plus him saying "we have a position in Fiat" kind of gave it away! ;D Cheers!

This is what I was saying: if their assets are not intrinsically inferior, its earning power can be fixed

I am wondering how much the liquidation will cost... seems a good bet if it sinks to the $7 level 10? LOL I actually bought some. Wonder how much cash they burn last Q. Paying $3.5 (net cash) for the everything with Prem trading a pull off a deal seems not a bad bet. What a screw up for Prem.

All right, I guess the question boils down to whether the low earning power of PWE is due to the nature of assets, or due to mis-management in the past; if it's the later case, we may count on the new management team to improve...

I think LTS is just the old petraBakken (not sure if I spelled correctly) At its current price the div yield is a staggering 13% Not sure how sustainable it is Also no idea why it cannot be taken under its current price. This one used to catch lots of discussion on seekingalpha (most posts from the ID "canadian value investor", who seems familiar with the oil&gas industry)

PWE below tangible book is not cheap ?

why did you pick PML instead of PMF ? muni bond makes sense for high tax bracket guys... have to say , the marginal tax rate is killing the motivation of average w2 professionals

The market cap of this one cannot be too big; otherwise Prasad wouldn't have been so careful (if it's apple he could just let us know , b/c all of us plus mr. icahn won't move this baby a lot)

Any hint about the sector ??? !!! Is it listed on NYSE/NASDAQ ??? !!! ??? !!!

Hi, Everyone: Due to the tax concern, I believe many should consider this as an asset allocation opp (including myself). My question is, in 2008 PMF lost 35% NAV, why the drop was so sharp ? I checked some fidelity open-end muni bond fund and they dropped way way less (almost no drop actually). Is it b/c PMF had a portfolio that has much inferior quality ? The yield is nice now, but I don't want to lose significant nav when a downturn hits - I buy into a bond fund in the hope it can hold nav so that in the market panic I can switch to some fat equity opps.

I was somehow scared by Meredith comments on local gov debt problem; so how can we be comfortable with the holding of these muni funds ? We cannot check their holding one by one - we have to trust them...

yeah, really no idea why fairfax and chou both love RFP so much...