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Stevieoopsie

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About Stevieoopsie

  • Birthday 05/11/1992

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  1. There are some screeners available I think.. Bloomberg's screener is the best and the TSX website one works too. Also building a mental library of specific businesses I suppose. I followed Yellow Media when they were in the last phase of consolidating the regional yellow pages businesses (a horrible business mistake - considering they were paying high multiples for those businesses already after Google Maps was launched). Back then it was a $billion company and widely owned by dividend investors in Canada. They structured their debts poorly and a lot of it came due at once, when their EBITDA started to feel the competitive pressure. The lenders refused to roll over and restructured the business/wiped out the equity holders. It was a tainted company after the restructuring and there was a lot of forced selling from the debt holders who got equity as part of the restructuring package, but the business was highly profitable and had a digital business that was still a growing concern.
  2. yellow media still looks v interesting. 270m of free cash flow in 2013, and market cap is a bit more then double that. Allthough they do have 650m in debt vs 200m in cash. is there something horrible that will happen soon? Yellow Media is basically a public LBO currently in the deleveraging phase. It all comes down to how much you think the digital business can grow/maintain margins and the decline rate of the print business. They recently hired the head of media from a company called Solocal to be their CEO, which is interesting because you can kind of look at Solocal (basically Yellow Media of France) to get an idea what Yellow Media will look like a few years from now.
  3. The majority of my best IRR investments have come out of the Canadian microcap space, despite spending 90% of my time looking at things outside Canada. Yellow Media, for example, traded at a 200% FCF yield after their December restructuring in 2012. You could have done some very easy math to figure out that they would be debt free in a few years and had two solid high ROC businesses, one growing and one shrinking at a manageable pace. Axia Netmedia was probably written up on this board before, and was dirt cheap on a very simple thesis. It's more than doubled since then. There are still things on the TSX that cheap, but most are in the energy space now. But you can find them if you try hard enough. The institutions here definitely don't.
  4. Hi guys, Does anyone know: 1) What's a good (cheap) broker to use that allows you to trade Korean stocks online, including preferred shares? 2) Is there a way to find English annual/financial reports/regulatory filings on these companies? If not, does Google Translate on Korean documents do an adequate job? Thanks in advance.
  5. Lots of interesting micro caps are listed on Toronto. The cost of setting up a small boutique fund in Canada is much higher than the U.S., which means small asset managers need to have a much higher AUM threshold to break even (therefore need to look at bigger companies to move the needle). Also the investment community in Canada in general is not as sophisticated as the U.S. The result is far fewer micro-cap bargain hunters and less competition.
  6. Networking is important but don't confuse real networking with the version that they tell you about at business schools. Business school's twisted version of "networking": begging strangers for jobs Real networking: providing value to people without asking for anything back to make genuine friends Keep in mind that the key is "providing value". You can't provide value unless you have a skill. And you can't get a skill from the stuff you learn from school; it's just not enough. If you are interested in deliberately learning and developing a skill, you have to do it yourself and there are plenty of resources on the Internet that can help you do that (like this place). If your passion is in value investing, I would go with accounting over finance, and the reason is accounting is simply more relevant to the value investing process - it's the language of business that helps you understand a business's fundamentals. Most finance courses taught at business schools are totally useless and can be easily learned on the Internet. I remember running linear regressions on historical stock returns as the main project for my "investments" class.
  7. There is a good shop called Turtle Creek in Toronto. They've done something close to 30% a year for 15 years and not a lot of people have heard of them. I think what you will find is that almost any boutique asset manager in Canada will label themselves "value investors" yet the vast majority are just value pretenders. I have friends who work/worked at a number of these "value" shops. Many of them turn out to be closet indexers (150 stock portfolios) and many are mostly marketing oriented. You will see their partners on BNN all the time; they just can't beat the index (especially after a 2.5% management fee).
  8. The metrics they used in that article frankly don't make any sense. What's the point in comparing annual ad spending, which is a flow variable that incorporates monetary value over an arbitrary 365 day period, and market cap, a stock variable? Most of the $134 bil ad revenue they quoted is very high margin (30% pre-tax) revenue. If companies can make an average 20% net margin then that's $27 billion in annual profit vs. $724 bil market cap for a P/E = 27 If you think the pie will keep expanding at 10% + for a very long period which is a perfectly reasonable assumption, a 27 P/E is easily justifiable. There are certainly pockets of the internet space that are currently in a valuation bubble but things like Google and Baidu, which operate with huge moats and inherent scalability, seem okay from a valuation perspective.
  9. For MSRs It depends on the cost of servicing. In the case of servicing prime agency loans, most players have more or less the same automated processes, whereas in servicing sub-prime non-agency stuff, some companies are more efficient at that than others. The non-bank servicers have demonstrated that they are much lower cost than the big banks at servicing mortgages. Another thing to consider is how the servicing portfolio is financed. The new trend is to shift the financing (mostly advances) to public REITs (which have a lower cost of capital because they trade on a dividend yield basis) which turns servicers into sub-servicers. Some non-bank servicers use that structure to lower their capital intensity and enhance ROE.
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