jschembs

Curious -- are you American? Good question. 3/4 of the respondents in this thread live in Canada and are infatuated by a political system they have no input on and constantly shit on the US. Their voice doesn't count Thank god. They cant get enough of it though. They will say its because they hate Trump or cant believe how stupid we are but they really know that the US butters their bread so are eager participants in the discussion. I think a great majority are still butt hurt because Trump had the balls to go after NAFTA or wouldn't share masks! Either way they just come to this thread and bitch about a country that they highly benefit from. If you took out all the posts in the thread of paranoid scared Canadians bitching about Americans it would be probably 15 pages long. Eh? I'm an American, and you're a clown.

Maybe people expect their sanitizer sales will sky rocket... https://www.cnbc.com/2020/04/24/coronavirus-kegs-are-going-bad-boston-beer-has-a-solution.html I think SAM May benefit from the demise of some craft brewers. As far as I can tell, booze sales have been pretty good so far during the pandemic. I certainly did my share buying beer, wine and cider. The valuation is egregious, but that’s true for a lot of stocks including those with much crappier fundamentals than SAM. I wish I had gone long this one at ~$460. Their sales have been gangbusters. They have category killers in craft beer, ciders and now hard Selters. Aaaand maybe, hoping to hit $12 in EPS for CY20. Jim Koch and insiders continue to dump their shares all over. Cant really think of too many better recession hedge stocks than this. Competition is coming from all over with the new seltzer releases....just like it did with soda and cider. I didn’t even realize the stock is up ~25% today until now , my comment was solely based on business performance. In my opinion, they have done a great job with the Dogfish acquisition and now with Truly Selters, which at least here near their. Home base (MA) seems to be winning over White claw in terms of display. They are also grabbing market share in beers (call it craft beer or not). Anyhow, as a consumer and just an observer how they do on retail or just looking at their financial performance, they do a great job.I can see them using their stock to roll up region craft beer producers (maybe Sierra Nevada to get a west coast stronghold) and growing organically with new products. They are clearly better operators than TAP or BUD. Eventually, they may get into spirits too. The stock is overvalued, but so what. Overvaluation alonein my opinion is almost never a good reason to short something. Wow, I hadn't looked at this name in a couple of years. What a ride. I think they are at risk of being squeezed on both ends of the spectrum. BUD and TAP may not be the greatest operators, but their influence over retailers via their distribution heft is incredible. Just look at how BUD blows out distribution of regional microbrews they acquire. Hard for SAM to compete on that basis. On the other end of the spectrum, you have the proliferation of local / regional microbreweries that will never be able to compete with SAM or BUD on distribution, but have sufficient regional name recognition that they can muscle out mediocre national brands. Sam Adams is not a beer anyone I know ever talks about. You're either drinking really good local brands when you want a beer or two, or drinking the Coors Lights of the world when you're on the golf course for the day. I know SAM isn't just Sam Adams, but I just don't see how these guys have a compelling market position over the long term, and certainly wouldn't touch the equity at ~80x FCF.

Any thoughts on CTAS as a short? Stock hitting ATHs on a surprisingly strong quarter, but given their customer base, I have to imagine the core business is going to really struggle over the next couple of years.

Curious what interests you about MRTN? TL trucking is a pretty rough and tumble industry.

I think you're misreading the situation. I think Trump's problems are self-inflicted. If he was a little smart and a little competent and had a little empathy, and was surrounded by people like that too, he'd have done what almost every single country has done and this crisis would've boosted his popularity and been a clear re-election calling card, as most successfully met challenges are for presidents (9/11 for Bush, for example). I protected you, this really bad thing happened and I dealt with it well, you can trust me to have your back for 4 more years, etc. Instead, it revealed him without a shadow of a doubt to be an incompetent bullshit artist who has no idea how to do the actual job, and polls reflect that. As for the market, it's always going to do what it's going to do. People think it should work in lockstep with the underlying economy, but if you look at the facts, it rarely does, too many factors and reflexive feedback mechanisms. If it did, it would be a lot easier to predict, because the economy moves a lot slower than the market.. While this is true, contrary to the beloved narrative some here like to peddle, I really could care less about whether Trump handled things in a way that best suited his political ambitions. In fact, theres probably a greater source of truth to the argument that without some degree of mismanagement, we wouldn't have the stimulus and rate policies that are making certain long and short term investments available and extremely compelling, not to mention predictable, right now. Short term, you have capital markets completely open at outrageous rates to companies just recently believed to be on the brink of "extinction"...longer term, you have guaranteed low rates and a put option of a party change which has already committed to an outrageous level of money printing, and yet inflation protected assets in irreplaceable locations trading at historic spreads against treasuries.... What are these extremely compelling long and short term investments you speak of?

But in 1999 we weren't in the middle of a very obvious, and likely very severe, recession. Well, beware of November then, if that is what you think is holding this up. Personally, I think the markets have come to terms that March was a media hoax and that while the virus is real, it is much closer to the flu than some doomsday bug. To the extent that politicians dont shut the economy down, things will grind it out, with the weaker numbers more than offset by confirmation of long term ZIRP and the goldilocks scenario where mainstreet needs stimulus for a longer time than Wall St does. I am still quite bearish, but this seems to be my read on why the market is trading where it is. Further, as BG mentioned, we had extreme excess and exuberance in some social media and biotech maybe 5 years ago, tech and pot 3 or so years ago, etc, which shook itself out. There certainly isn't a case that there arent stocks you can buy for reasonable valuations right now. But as always, you have to pay up for quality. If you wanted firesale prices, you should have been buying in March. I wouldn't be opposed to a real bear market. I would actually welcome it. I'm just saying that we're not close to 1999 levels from a euphoria (or valuation) perspective in my opinion.

Seems a bit tough to use Q1 earnings data to talk about market valuation right now. There is no question Q2 earnings are going to be meaningfully lower, and I haven't seen any compelling arguments in favor of a rapid recovery.

Why have cities always been desired? When travel and communication was more difficult and time consuming cities brought people and ideas together in one spot. Population density was a necessity for ideas to spread and serendipitous meetings to take place. Also it allowed an economy of scale for businesses. All of that still happens in cities, but, I don't know if that is still entirely necessary. People now meet and talk online just as easily as off, and with modern shipping the whole country is your marketplace. Very well said. Still impossible to replicate human interaction, but virtual is good enough for much of day-to-day life, and when compared against cost and livability of cities, will be very interesting to see future trends.

this is a great post, but it addresses what associates and junior executives have to do...senior execs may not feel as strongly about the social/management aspects, and care more about the bottom line cost savings effect on their bonuses... It's been interesting to see how COVID has adjusted my perspective on the value of face-to-face meetings. For some perspective, I'm a partner at a regional M&A firm. Networking historically meant breakfasts, lunches, coffees, happy hours, larger events. I always felt a phone call didn't present nearly the same impact of a face-to-face meeting. While I agree that remains true for initial meetings and "relationship building," I've found phone calls to my existing network to be very productive and engaging - if anything, calling someone while we're both out of the office has far more intimacy. Further to that point, think about the relative inefficiencies of a face-to-face meeting. Even for a quick 30-min coffee a few blocks from your office, you're likely nearly doubling that time with walk to/from, wait time for your drink, etc. The takeaway for me is twofold. First, I can easily maintain networking with my existing contacts working remotely. While I'll certainly start going downtown during the summer, it's likely it'll split between in the office for more essential internal meetings, and more catch up calls at home. Second, many service firms are reevaluating their office composition, networking / marketing strategies, and as a byproduct, square footage needs. I'm sure some of this is overreaction to the current environment, but I am convinced this will alter service work schedules and environments, with negative impacts on CRE. Further, the byproduct (which we're seeing in Seattle) is that retail / foodservice serving these markets will also be impacted, with resulting impact on CRE. As an example, Specialty's, a fairly entrenched breakfast/lunch/coffee chain with ~50 stores on the West Coast, closed shop last week. https://www.sfgate.com/news/editorspicks/article/all-locations-of-Specialtys-close-15276064.php

This thread is going to cause COBF to collapse upon itself and vanish into some distant galaxy.

Do you have a link to Klarman's recent musings? I do find it interesting to see Munger and Buffett signaling in their respective ways (Munger more overtly, Buffett more covertly) a real concern. From Munger's 4/17 WSJ interview: “I do think, sooner or later, we’ll have an economy back, which will be a moderate economy. It’s quite possible that never again—not again in a long time—will we have a level of employment again like we just lost. We may never get that back for all practical purposes. I don’t know.”

Yeah, I'm not saying there's no possible signs, but the thing is, a lot of non-sociopaths have a lot of these too, right? It's a lot harder to stay balanced under certain stresses and pressures and spotlight (as a lot of regular people who become wealthy/powerful celebrities find out). Maybe he's a very pro-social sociopath, as he seems quite obsessed with old-school science-fiction ideals of saving the world through rationality and ingeniosity. But who knows? Right, everything's on a spectrum, and honestly I never even made the connection until I was checking the sociopath boxes vis-a-vis Trump. Elon is way more personable and funny / irreverent than someone like Trump, who is not only a sociopath but also just a horrible human being [not intended to be a political post, as I don't think Trump is even a Republican].

I don't think Musk is a sociopath. Possibly Asperger's, if I had to guess, though. Finance people keep trying to read him from the CEO mold/pattern, but he makes a lot more sense if you look at him as the kind of uber-geek that grew up on Slashdot and Ars Technica forums and Hacker News and Reddit humor and trolling, who through sheer force of will and vision ended up a billionaire CEO but was never really of that species, and never took all that seriously, just wants to build cool sci-fi stuff. Obviously the stress and lack of sleep and all that is affecting him. It'd affect anyone under those circumstances.. I wish he'd find better high level people to offload a bunch of stuff (like Shotwell at SpaceX, maybe 3-4 more like her), but delegation doesn't seem his strong suit and ultra-intense, single-minded and brilliant people don't tend to be easy to work with or for up-close... I don't have the time or inclination to find links right now, but I'd argue he exhibits all of these characteristics typically associated with sociopaths. - Lack of empathy - Difficult relationships - Manipulativeness - Deceitfulness - Callousness - Hostility - Irresponsibility - Impulsivity - Risky behavior He's most certainly a genius, but genius often comes with other, less desirable personality traits.

Washington just extended shelter-in-place to May 31st.

I'd take Musk as president over Trump any day. Oh absolutely, just amusing to me the similarities between the two of them. Both have sociopathic tendencies to a T.

The M.O. of everyone involved here is just to make stuff up and change it until it either goes away on its own because they jam the news cycle full of daily stupidities and scandals and nobody can keep up, or one of the variants they made up works better than the others ¯\_(ツ)_/¯ The man is in charge of a COVID task force, there must be signs all around Mayo about the rule (how do you think they get people to comply?), everyone around him is wearing masks, but oops, he didn't know. Not very convincing. There's a car company executive who seems to employ a similar strategy.

https://en.wikipedia.org/wiki/Idiocracy

I bet many investors would have preferred he was 100% BRK at this point I didn't mean to rag on him specifically - brutal turn of events and obviously he had no way to anticipate in Q4 what would happen - but more generally. I'd be curious to see the number of funds that are at least 15-20% BRK, I think it'd be surprising how many there are.

Definitely remember his name, then just checked the 12/31 holdings. 30% in Berkshire? Always surprising to me that no one calls out concentrated BRK positions among fund managers as just another fund of fund.

Of course his first priority is himself. He's a narcissistic personality disorder and likely a sociopath. He doesn't care about reopening for "the economy" in general, he knows this current path doesn't lead him to get re-elected, and it's really bad for his hotels and resorts and his debt payments, and if he's out of power it's dangerous that he'll be investigated without pardon power, so he's ready to gamble it all and put all his chips on 15 black and spin the wheel in the hope that this other approach may be better for his election and businesses. He's been incredibly lucky all his life, born to wealth, getting away with all kinds of stuff, becoming president.. He's just gambling with lots of lives and the US healthcare system in the balance that his luck will hold. And he didn't know back then. He's not intellectually capable to have understood the implications when it was still theoretical, and he's surrounded by yes-men and he fires or drives away anyone who's independent-minded pretty quickly. Can you even imagine him reading complex briefings and diving into the details? He thinks in cable-TV soundbytes. Listen to him talk about any of this and it's just a bunch of word-salad "it's great, going tremendous, big effort"... No real understanding. Even now as people are dying and hospitals are being quickly turned into disaster zones, he's not listening to the people who know what they're talking about, he's driving away Fauci and contradicting his task force on TV and picking petty fights with desperate governors who need federal help. He's likely never even spoke to anyone on the front lines of this and shows zero empathy for anyone dealing with this, only worry for himself veiled in language about "the economy" (which was how he always said he measured his presidency, always talking about stock market records, etc). Wish I could say I thought any of this was "left-wing slander" (not implying you're left wing). Any links to the rift between he and Fauci? edit - corrected my right from my left...

That would be impressive if DDOG at 25x revenue turns into a 100 bagger.

Perhaps after restructuring - have you looked at their balance sheet and cash flow statement? E-commerce is hard enough to begin with, let alone when you are trying to sell heavy, difficult to ship products at 20-25% gross margins. Also consider that a company that enjoys a negative working capital cycle when sales are expanding (and finances growth from that) will see that unwind, with declining sales causing a cash drain. Good point. That could come back to really bite all the SAAS darlings as well. Dig into their wonderful FCF generation and it's mostly D&A, stock compensation (which will likely decline either due to lower headcount, which kills the growth narratives, or employees demanding more comp in the form of cash), and upfront cash payments on multi-year contracts.

Perhaps after restructuring - have you looked at their balance sheet and cash flow statement? E-commerce is hard enough to begin with, let alone when you are trying to sell heavy, difficult to ship products at 20-25% gross margins.

Sorry what's the Cialdini connection here? Robert Cialdini. Have you read some of his books? Yes I've read Influence, just didn't get your reference (admittedly it's been years since I read it).

Sorry what's the Cialdini connection here?