valueseek

Thanks much @longterminvestor. Just great color and insights!

Hi @Parsad I second the comments and sentiments of many on this forum. I have followed many a different forums, channels, research services, etc. in the past decade. This has been one of the best in terms of overall life and investment related learnings. So thanks for that and to the excellent posters here willing to share their thoughts and experiences. Thanks.

Thanks so much @longterminvestorfor your invaluable insights. Worth their weight in gold! Have been reading about them most of yesterday and today. Had a few questions on Ryan - not urgent at all. Wrt wholesale brokerage business, my understanding is that the retail brokers still primarily own the client relationship. If this is true, then can the Aon, mmc, etc. threaten Ryan, amwin or Crc to move business away from them and/or continue to keep more of the commission for themselves? In other words are retail brokers more robust a business and could they squeeze margins from wholesalers over time or the technical knowhow wholesalers present doesnt allow the retail brokers to do that? I guess wholesalers would have pricing power or much value creation for the sub $10m rev. retail brokers? How easy is it for large producers on the wholesale channel to go out on their own and start their own shop? In other words is it more difficult at wholesalers to do that vs at retail brokers because end clients for the producers at wholesalers will have to be the retail brokers? From a producer perspective, is working at a wholesale broker a tougher job or higher paying job than retail or both are similar and does not matter? Seems to me wholesale brokerage might be a better higher paying gig with higher inherent growth as well. In Ryan’s slide regarding the growth algorithm, any comments 1 growing from panel consolidation. How big of a tailwind is this given the market seems already quite consolidated with the top 3? 2 e&s market continuing to grow 4-6% above admitted market growth rate. This has been happening for the last decade to the tune of 500bps or so but of late there seem to be at least in some conference calls discussed that this trend may reduce. Any thoughts for next few years on this? 3 how much contribution from MnA in this wholesale brokerage space one should assume given top 3 are 70%+ of the market already (and only wholesalers vs 1000s of retail brokers (mmc, aon, etc.) that are much less concentrated in top 3 at around 25% or so. Or would it be that they could be acquiring on the retail side as well? 4 Which between the mga/mgu part of the business and the binding authority part of the business is the more attractive from a growth and industry structure/tailwinds perspective? Thanks

Great discussion here. Thanks @longterminvestor for some invaluable insights. Does anyone here have any insights on $RYAN- what Pat Ryan is building? Also, this is not a broker - $KNSL, so disregard if not appropriate for this thread but $KNSL is an E&S insurance player. They have just kept on delivering since their IPO in 2016 or so. It was brought to the market by JPM. Mike Kehoe, CEO and founder used to do the same at a previous company before founding Kinsale in 2009 with some PE backing if I remember vaguely. I had the good fortune of meeting him for an hour back in 2019 and was quite impressed by the meeting as my recollection is he primarily talking a much different tone than a typical ceo - about wealth building, partnering, controlling risk and the opportunity for them. But due to valuation and primarily my lack of understanding of the space, did not do much. Since listing some 7-8 years ago, EPS is up 10x and stock is up 20x. It has mostly traded at 25+ PE multiple and 5+ times PB (or 8 times curr.). It will be great, if anyone has anyone has comments/insights about any of these two businesses $RYAN/$KNSL. Tks.

Bought some Sesa spa. Some tixt.

@Spekulatius Thanks for the gurufocus tool. Nice quick one as a check.

This is a great post. Thanks for concise and thoughtful explanation.

This is how i hsve thought sbout it as well. It should be reduced from ocf for employee cost. And characterised in financing cf as it is more of a financing transaction.

interesting and thoughtful take Spek

Have been following Sauls forum for last few years as well. Believed it should be termed - Sauls concentrated growth trading forum. With the cult following, they had a great run 5 years prior to 2021. He has never really revealed how much money he has invested in the retirement accounts he quotes. And Enphase is really a shocker for the SAAS drumbeat for last several years.

This is a good one. Have followed him last 7-8 years. Has some good books. He is generally bullish but also quite practical in the way he has been vary about avoiding the corrupt companies.

Tks for some excellent posts. Esp. The art of writing vs investing long term

I have been mostly a silent observer on this forum. Have gained immensely mostly from the diversity of content in the forum from various members. In previous years, my top followers had been Liberty, Ericopoly, Packer16. More recently it is definitely dealraker with the wisdom. And otherwise it is Gregmal, Parsad, Spek, Viking, Sharper, gfp, valuebo, and many others as well. Thank you very much to all.

for the last 5-10-15-20 years the sales CAGR on 3 US rails is around 3/2/2/3% give or take. 10-15 EPS CAGR is 11-12%. 5 EPS CAGR is around 5%. 2% dividend yield. Price return or stock CAGR is around 12-13% CAGR. Add 2% for div. yield so around 14-15% total stock CAGR. Starting valuations were slightly lower at 13-14 times PE, margins were lower and leverage was lower. Given starting valuations are around 16-17 times, margins are higher but lower than last year or so and still room to grow albeit slowly, and possibly higher volumes given US infra/near shoring focus, EPS CAGR for next 10+ years could be 9-10%. Add 2% div. yield. Subtract 1% or so for ending PE reduction, fair probability to get -HSD10% returns from rails from here over the course of the decade.

Just my couple of cents to this. - Adani Group’s great rise in stock price has been an enigma to most reasonably verse stock market investors in India. - From Buffett’s point of view, analyzing this is in the too hard pile. - the news itself from Hindenberg doesnt come as big surprise to many. I used to read the exact details of most of these short reports a few years back but have doing that in detail. So maybe there are a few points in there that are outright fraudulent, some questionable, some maybe cultural issues, etc. All I know seeing financial commentators and market participants over the past several years is that maybe 70%+ would not have read the report and seen the headlines itself. - foe Adani it has been well known in media about his links to the government. For one to get big infra projects and do well that is required in India. Its just how it has been for decades. Thats why much did not get done in previous decades. This govt. has tried to change it and maybe they have picked Adani as their goto guy. - this report does not imply the whole or majority of country is a fraud. But things are donw differently in emerging markets. That is the starting point. There is more instances opportunity of mishandling public money than in developed markets, teh promoters mighg indulge in some self dealing, etc. May be a certain double digit percentage of the total listed companies may be like that. -disclaimer: I have not read the report and dont intend in the next few days. So some rambling may be misplaced Thanks

This makes sense but somehow I have not come across this argument being put other places. Whatever I am aware of most people peg ERP above 5%. Is there any research or document or articles you have seen this or is more your thinking/analysis? Thanks.

He is the last person to be influenced but this was pitched at Barron's roundtable 2019 by BRK director Meryl Witmer. https://www.barrons.com/articles/a-travel-play-and-a-box-stock-favored-by-eagle-capitals-meryl-witmer-51547863453

How much credence would one pay to such values of undervaluation overvaluation? Those seem ok to look at as a broad swath but very hard in my opinion to get much investing credence out of them other than knowing its history over several years, and what inputs and forward return metrics they are looking to compute those.

Nice discussion. Just a quick point on NVR. I guess NVR changed their strategy after their bankruptcy more than a couple of decades ago. And also, current housing market is no where comparable in whole to 2006 GFC. Interesting fact for me was that NVR's EPS was $89 in 2005. And it took almost 10+ years for them to achieve $90 EPS in 2015. From 2005 to 2015 sales per share increased from $675 to $1120. Sales per share peaked in 2007 at $900, declined for 5 years until 2011, and took further 3 years to reach $900+ sales per share level. Basically if there is some guestimates on the next 3-5 years sales per share trajectory at NVR based on various macro conditions (house prices, sales of units, etc.), one can get a good approximation of the returns expected from here. Unless sales per share are negative for next 3+ years and they are able to maintain 5-10% growth per year, stock return over that period should be reasonable 10%+. Very crude analysis.

Congrats on the new website! Looks good

Happy new year everyone! Thanks to all the members and contributors of this forum!

Thanks.

EZPW, a lot of MLP companies investing for growth, many O&G companies/frackers/drillers going into bankruptcy coming out and then going back again such as CJ, mostly shipping companies where corp. governance is a joke, a lot of Chinese listed ADR's, some of the consumer finance non bank lending companies.