kab60

Anyone here have any more details as to what happened? Looking at the Q1 portfolio update, it seems he would either have been levered and getting margin calls or hit by redemptions - both at the worst possible time. His massive selling in Q1 probably explains some of the crazy drawdowns many of his holdings had. Really terrible timing because some of his recent picks, like Wayfair in Q1 and Covetrus the quarter prior, have been huge winners. Trying to figure out if there's anything to learn from this - other than sticky money goood, leverage baaad.

it's still has a 8.23% yield at the current price. W/o doing anything, it's not a shabby return. Nope, I think that it's very favorable in this environment, but I see more upside elsewhere. There are still some pockets where I think the market is overly focused on the short term. I'm pretty big in auto dealerships and while Asbury in the US is up 150 pct since its low, Cambria Automobiles in the UK is only up like 30 pct after dropping back lately - despite fine results and updates from peers. So just a relative valuation call, WMB looks good here and probably have more juice. With rates at these levels their assets are extremely attractive.

WMB, like the Company and pretty cheap but not enough upside

Ulta Beauty, Cambria Automobiles

It seems the range of outcomes in March was higher than it is now. Covid19 has hardly been the deadly killer some feared though the economic impact of the close-downs are obviously hard to gauge. On that account I'd venture it's a much better risk/reward today than it was back then. And correct me if I'm wrong, but he did seem to indicate it was cheap at 160 - but also that it wasn't possibly to accumulate anything meaningfully since it just traded down for a short while. I really hope he took advantage of the price in Q2, but I'm not getting my hopes up based on his meager buyback track record. On the other hand, he's never had as much cash, and so little to deploy while at the same time Berkshire trades at a - relative to history - very low price.

CAST SA. Illiquid French SW company - extremely cheap and hopefully at an inflection point which sets it up for margin expansion.

More Lion Rock Group in HK

He seemed pretty level headed and sharp during the AGM, so I suppose he misjudged the situation - or at least the outcome - like Druckenmiller and most famous money managers as well as the majority of people on this board judging by the activity here in March. So that sucks as a shareholder. On the other hand, I think his stake in Apple shows he hasn't completely lost his marbles and turning on Airlines and banks, despite bad timing, indicates he's still flexible. Anyway, I think I'd prefer if Berkshire just put idle cash in S&P 500/BNSF/BHE/buybacks depending on the best expected returns so it became a permanent, float-levered equity on the broad market, because I think it's basically impossible for him to stockpick and beat the averages with the money he juggles with. Espescially when he won't go near stuff like Altria or Bud and cuts himself off from obvious opportunities. I Hope the old guy has an ace up his sleave and bought back a truckload in Q2, but I wouldn't count on it.

why KNOP? Quick trade (went long two months ago I think), never intended to hold for long but liked the somewhat uncorrelated risk of their charters and their niche . I think it'll do fine and trade up to BV, but I went a bit on margin in March and I'm dialing back down as well as putting more money into markets outside of the US.

KNOP, 1/4th of ADS

Monty Bennett of Ashford. Crazy management agreements makes him drown listed REITs in debt. Then he drowns the management Company in preferred shares handed to himself and his father through two acquisitions of their private companies. He's the worst I've come across. Which is why it seems like poetic justice that slimebag Brookfield is coming for him.

A bit of Lion Rock Group - trading below NCAV, good business in a tough industry, fantastic owner-operator - normally pays out about 75m in dividends (growing) versus 580m marketcap atm, but took dividend down a bit and did a spinoff of a listed sub recently. Well positioned to handle trade war after establishing a large presence outside of China.

More Cambria Automotive and Cast SA the other day, now it is time to just wait and delever

Basically this. You can rationalize holding it for personal accounts or accounts with certain risk profiles. But as an active manager who charges fees it is very hard to justify holding this. Its amazing that folks would criticize Ackman here, when Buffett is the one who's approach and performance, is if anything, the thing to look at and question. I'm not critizising Ackman here. He played it well so far, obviously. I am just surprised he didn't sell Berkshire in March but apparently after the initial strong rally in the broader market if I read this right. Judging by the results it might have given him a better outcome, I just think the risk/reward is pretty unique now - more so than in March.

I understand why one would've sold some in March, since upside was better elsewhere, but since everything rallied and Berkshire stayed in the gutter during April and May - like 170-175/share last week - I don't quiet get it. Risk/reward seems as good if not better than in early 2016. Would be great if Buffett bought back shares when he realized things probably would not turn out as bad as feared.

It will be interesting to see whether this acceleration of mall and B&M deaths will be a major tailwind for succesful retailers like Ulta Beauty. They might lose some competition while landlords lose leases and thus rents might be lower for longer.

Sounds like a good decision but will miss your post. Learned a lot, thanks a bunch.

Thing is up almost 300 pct from when I wrote - from down 75 pct to up 50 pct. What a rollercoaster. Hope others limped in, crazy setup and despite runup insiders still buying. Haven't sold, suddenly 15 pct of portfolio. Haven't done any work but another aussie idea might be Village Roadshow, Mittleman is long.

gfp, that was the way it used to work in Denmark as well. Fantastic deal (espescially since 80 pct of retail price here is taxes). So enjoy it while it lasts. :)

More BRK

I have a 23 pct. position and portfolio margin of 15 pct. currently. The upside isn't crazy, there is no catalyst, but I like the optionality of the large cash balance and the reinvestment opportunities in rail and renewable. I think of it somewhat as a HY bond (7-9 pct return) with IG credit and equity volatility - and now possibly a rerating down the road. Considering the broader rally and defensive positioning I think the risk/reward is great but I use margin because the upside is lower than I would usually go for.

Motorpoint PLC

Asbury Automotive

Townsquare Media, Knot Offshore Partners - funded by a bit of Spirit Airlines, Alliance Data Systems

I am a little bit concerned about the debt covenants. My stomach is weaker than yours, I puked this out when it was 0.57AUD, now at 0.175AUD. It trades like an option now. Well, you did well selling. I averaged down a couple of times - and doubled it today. Ugh. Someone mailed me to get my view, quick view here (all very back of the envelope): From the recent CC (from the CEO): We have a net leverage ratio where we can't exceed 3.25 in the first year. That doesn't get tested until the end of this year. And everything is on the basis of around run rate and those sorts of things. So we're comfortable with that at the moment. And based on those, so no concerns on that. So I think end of last Q they had around 300m drawn on their 375m debt facilities and 50m cash so 250m net debr vs guidance of some 75m ebitda. So obviously close and obviously things have evolved for the worse with corona-virus (if you go to AMAs website they sent out a note to customers, clients etc.), but they're still in business - this isn't retail. And there might be pent up demand from hails storms that hit Australia. But I think what's important here is the comment on run rate which I assume means that they'll be able to include, among other things, 17m in expected synergies (they have alluded that it will be higher, so perhaps they can bump it up). Either way I think there's a real risk that they breach those covenants - but I also expect lenders to be willing to waive those given the special circumstances. Very few banks will want to write off a loan six months in - and optically it would look extremely bad. As for valuation, with a marketcap of 125m and 250 net debt the price of AMA is below the price of the Smart Capital acquisition (where rumour was others were willing to pay around 320m I seem to recall) PLUS the old Ama Group. Blackstone was close to buying the whole thing for some 10xebitda while right now - if things go as planned - they might do plus 100m ebitda in their fiscal 21 so around 3,5xev/ebitda. I know it sounds almost stupid, but that would potentially imply equity upside of some 600 pct. from here. There is real risk of permanent capital impairment, but I think the risk is severly overstated and would expect them to get a waiver if they trip covenants. Last resort perhaps call Blackstone again? And I don't think things are all that dire. This is smash repair shops that should be extremely resilent since insurance pays, AND they had good answers on the call as to what needs to be improved (and it seems pretty easy to fix). CEO owns a ton of stock, three insider buys since beginning of march - post results. That was a quick plus 200 pct... Company update out today, basically as expected. That was the best setup in a looong time. Increased pricing and covenant testing postphoned. Still think it is worth twice as much. Suddenly a very large position.