EricSchleien
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Posts posted by EricSchleien
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I'd love to hear everyone's favorite financial news sources. I'm compiling a list of sources both print and online.
Paid or unpaid?
Either!
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I'd love to hear everyone's favorite financial news sources. I'm compiling a list of sources both print and online.
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The context of the title is simple; a wee bit back I recall talking with a manager who recounted how he bet big on BP during the oil spill. I've heard countless times from folks who bought financials or real estate during the GFC. The is obviously a period cut from the same type of fundamental disruption fabric. So, for those willing to get their hands dirty, what names in the hospitality, restaurant, airline, cruise, entertainment biz are you looking at as the name you boast about buying during the coronavirus panic 5-10 years from now? If not a specific name, what investment are you making or looking to make? These are the scenarios where fortunes are made, if they arent lost first.
For me, I've been long a shareholder of the MSG entities. Ive regularly stated I planned to sell the entertainment company upon spin off. However, it is becoming apparent as the April 17 date approaches, that the spin off will get an abhorrent valuation despite having no debt and over $1B in cash. I am very much intending to hold my existing shares, and flirting with the idea of adding depending upon where things stand.
AERCAP
Parks Hotels and Resorts
Basket of Cruises
StoneCo
American Eagle
Urban Outfitters
Shopify
Tesla
Facebook
Heico
Transdigm
These are the stocks in general I found has an overhang of bankruptcy but can't see them being BK unless in a real draconian situation - and if that's the case we won't need money.
How does Facebook have the overhang of BK?
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Has anyone here ever taken any courses with Coursera or Udemy? Wondering if anyone has positive experiences with either platform.
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I interviewed one of my colleagues who has trained a lot of the monks for the Dalai Lama, currently works for PayPal and Google, and worked with Chip Wilson to help start Lululemon from 0. One of the most extraordinary human beings I've ever met in my life.
https://ericschleien.com/podcast/scott-forgey-google-paypal-how-to-keep-large-companies-innovative/
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Speaking being
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Huge fan of my 2019 Subaru Forester Sport :)
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Merry Xmas
to everyone celebrating today and a healthy happy holidays to all of you. Wishing you all creating a fantastic 2020 
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Hi All -
I've started to poke around within the Oil & Gas Sector as pretty much anything commodity related has been beaten down. I remember in 2016, there was lots of bond opportunities in some of these names.
Want to start a thread so we can discuss different ideas/opportunities as they come up, and perhaps want some feedback on our ideas.
Best,
Eric
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I agree bizarro.
Eric, go back to the first post of the thread:
According to GMP (see below) Dundee Capital has a net asset value of $16.02 as of last quarter yet trades on the TSX currently for a meager $4.90 heavily discounted Canuck bucks. This is about 30% of its calculated NAV.So at $5 it was a steal. Now it's $1 and it's still a steal. Eric, why are you ignoring the history on this?
I have. I owned this. One of my worst investments of all time. Basically getting the itch again to invest and looking to have others talk me out of it :)
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I'm getting antsy to buy this again at these levels.
Who read this seeking alpha article and thinks this is still a BAD investment?
Would love to hear the bear case here at these levels/valuation/management. The employee stock purchase plan being putting back into place as well as the CFO taking 50% of his bonus in stock, while not necessarily that meaningful on its own, is something that had me perk up here which also led to me reading this article.
Would love for someone who genuinely thinks this is a bad investment to share with me their bearish view at these levels.. thanks!
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Hi Stuart - The article from Feb 2019 is one I wrote. The article was based off a podcast that I recorded which you can check out here: https://ericschleien.com/podcast/anthony-waldichuk-national-stock-yards/
Best,
Eric Schleien
Bought more National Stock Yards (NSYC)
Same here. I suspect the pot. SEC action may scare some investors away from dark stocks and cause some selling. I am happy to oblige and provide liquidity if the price is right.
Not much public information out for NSYC, though from the Seeking Alpha post in Feb, 2019 it sounds very interesting - especially at a market cap of $9m. I emailed the company to see if they'll send annual reports on request. I don't like my chances, but it's worth a try.
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Bought more National Stock Yards (NSYC)
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Good article I read today: https://www.profgalloway.com/mdma
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Increased my position in Trupanion, GrafTech, and also initiated an arb position for a small thinly traded company that's tendering out shareholders.
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Crowdsourcing interesting topics to discuss on my podcast. Thanks guys in advanced :-)
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I remember selling out of this stock back when Prem added those equity hedges when franchise businesses were selling below book value. I'll give them the benefit of the doubt that they may have been over-levered for a protracted recession, but boy what an error.
For those "value" investors clinging on for hopes of getting validation, here's something to consider: "Software is eating the world". It's not "value" investing isn't working it's just that these companies are getting destroyed by fundamental shifts in the global economy brought on by technology. The opportunity costs are enormous when you consider tech companies can grow at 0% marginal costs while "value" companies are lucky to get 5% ROIC going forward.
On the latter point, I spoke for about 2 hours in depth about this at my annual meeting this year in NY. I think you're exactly on point here :)
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Good points vinod1.
My own reservations regarding Fairfax are as follows:
1. Leverage: FFH has roughy $3 in insurance liabilities for $1 of common equity and another $0.50 mostly in debt. With so much insurance liability leverage, I think they are forced to keep most of the float in fixed income or cash. Obviously when it works, leverage produces great results but the reverse is true also. One major CAT loss, a huge portion of common equity will be wiped out. I really don't like the way annual letter shows underwriting results with and w/o CAT losses as if CAT losses were not supposed to happen and are highly unusual. It is as if management wants shareholders/readers to ignore these insurance losses when they are normal part of being in the insurance business.
2. Invested Assets: Just the fixed income portion of assets is larger than common equity. And it is highly unlikely that FI portfolio will produce great results going forward. And common stock selection has been awful during the last 10+ years. As others pointed out, they like to go for the crappy stuff all the while completely avoiding quality long term investments.
3. Macro Calls: A big negative in my book. One can easily see them making a 2020 US election macro bet for example if past is any indication.
4. Sub-optimal capital allocation: The dividend policy doesn't make any sense especially because they immediately issued more stock many times in the past right after declaring dividends. If they need more capital why not retain earnings? Why force shareholders to pay tax on dividends and immediately dilute them with new stock issuance?
5. Board governance: Too much Watsa family involvement without a clear benefit to the company or shareholders.
Obviously the dividend policy is in place to keep control and pay the Watsa family
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One person’s data is worthless. It’s only worth something in very large aggregate.
agree. but since each individual is part of a platform network and that network is monetizing the aggregate, each individual should get his/her proportionate share of the aggregate value
You do. It's called using a "free" service
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No problem, happens to all of us. You should let BA's investor relations know! They might have a coding error.
wouldn't be the first time that Boeing has had an error with their coding....
MIC DROP...wow!! that's epic
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More TRUP
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From Oct 19, 2018 - an email from Fairfax India
Hello Eric
Fairfax India is considered a PFIC for tax purposes.
Thank you
John Varnell
VP
This is a question for American investors in FIH. It was noted earlier in this thread that FIH could well be deemed a PFIC by the IRS. Jurgis commented, "It likely will be [a PFIC] unless it acquires controlled operating businesses fast." So I'm wondering how others are dealing with this issue. Possible strategies:
(1) Ignore the risk and hope the IRS either doesn't notice or decides it's not a PFIC. Might work if you're a small shareholder. Huge losses if it doesn't work.
(2) Try to figure out the PFIC rules, and go by them. My impression is that the taxes one would then owe would make the investment much less attractive--I think essentially, all unrealized gains are taxed like ordinary income each year. Also it's unclear to me what information is needed for tax filing, and how to get it if the company doesn't help out.
I've only owned one PFIC, and the (Canadian) company provided Americans a sheet each year with the necessary information to deal with PFIC filing.
Useful link:
https://ustaxcompliance.wordpress.com/tax-triggers/a-pfic-primer/
Did you ever receive any closure on this issue?
Microcap Potential Activist Opportunities
in General Discussion
Posted
With the market down again - I'm just going to re-share:
If you are a shareholder in a company and the stock has these following characteristics:
- market cap is under 400m and ideally under 200m
- insiders own 10% or less of the stock
- company is being mismanaged in some way
please let me know and if it seems like a good fit for what I can do in implementing tribal leadership, I will pay for ALL of your expenses related to the proxy battle to replace management.