KPO
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Posts posted by KPO
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CVS & TRC
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52 minutes ago, gfp said:
So I believe that technically, AIG said they had a trillion dollars of assets in 2007 before the crash. Obviously we could put an asterisk on that one.
Nice sleuthing here. It’s pretty remarkable how large this company has become since I started following it in ‘94.
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2 hours ago, gfp said:
Warren got to print his first trillion dollar asset figure on the balance sheet, so that has to feel nice for an old fella.
Not that it really matters, but is Berkshire the first non-bank to $1 trillion in assets?
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More SAVE a bit below $18 yesterday
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23 hours ago, LC said:
Are you Denver based?
This is exactly what happened - COVID hit, people stopped going downtown for work. Turned into a ghost town and the homeless moved in.
Now it's 3 years later, everyone in Denver would rather be hiking/biking/skiing/etc. so nobody has returned to the office, so the homeless have pretty much taken over. It's slowly getting a bit better but lagging other cities for sure.
We just elected a new mayor who campaigned on "solving homelessness" but like Greg said previously, everyone promises to solve stuff they don't have the power to solve.
That said, downtown Denver/16th street mall was always for tourists, business travelers...kind of like the 9/11 memorial in NYC...people who live in Denver never actually go there. Pretty much every neighborhood adjacent to downtown Denver is much nicer, better restaurants, etc. And then there's Cherry Creek for those with too much money and not enough taste (kidding :D)
I’m not. I was in town for a concert, but used to visit Denver a fair bit for work. Makes sense that the adjacent areas are benefiting as I wouldn’t hang out at the 16th street mall if I lived there based on what I experienced.
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Bumping this topic given the ATVI success. I like the fact the business performed well post announcement to the point it wasn’t an unreasonable value in its own right in the mid $70’s, which is what you’d ideally like to see in these situations. With that said, what are folks looking at now?
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I’ve spent the last few days walking 35-40K steps per day through the Union Station and central business district of Denver and it’s been eye opening. There seems to have been a second order effect of Covid that took 40-50% of the 16th street mall retail out. Homeless people were everywhere in what sadly resembled a post-apocalyptic world. Around Union Station I’d estimate 40-50% first level vacancy in a three block radius. We saw a Starbucks in the first floor of the First Western Trust building that didn’t have a single table or chair inside, so obviously getting ready to close. Also saw two beautiful brand new 4-5 story buildings by a Denver brewing company location that were 100% vacant. I was starting to warm up to potential contrarian commercial real estate investments, but this definitely stops those thoughts.
Are others seeing this in their neck of the woods?
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1 hour ago, VersaillesinNY said:
He is back: http://brklyninvestor.com/
I’ve enjoyed his commentary in the past, so thanks for the heads up.
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On 6/21/2023 at 10:02 PM, gfp said:
Warren put out a press release regarding his annual giving -
https://www.businesswire.com/news/home/20230621049174/en/Berkshire-Hathaway-Inc.-News-Release
The second to last paragraph is kind of funny as you could take it to mean, “if not for my charitable giving I’d be the richest person in the world (or close anyways)”.
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31 minutes ago, Sweet said:
Anyone looked at natural gas as a potential play? I’m probably not going to take any position but I have been looking at it.
Definitely thinking about this. Nitrogen fertilizer exported to Asia, and really anyplace with natural gas arbitrage opportunities, is a possible way to exploit the low North American natural gas prices at the moment. What’s the best instrument is the question. CF maybe?
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3 hours ago, LC said:
What retailers are you looking at, Sanj? Overstock doesn't seem to fit the bill you describe in your post.
I don’t love retail, and don’t own any yet, but BBY is starting to get interesting at a >8% free cash yield, 4.9% dividend yield and net cash of ~$400M. As we’re hitting the three year anniversary of the COVID PC, iPad, big screen TV, etc super cycle I can envision a replacement cycle kicking off in the next year or so. They’re also starting to do some interesting things in the area of aging in place/elderly monitoring, which should be an attractive market as the baby boomers age.
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CFFN starter
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TRC starter at the close.
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1 hour ago, Spekulatius said:
You won’t go broke but how do you make money buying a bank with a ~5% ROE at book value? TFSL is a similar play (sort of a failed mutual thrift MHC conversion where the founders son controls the business). At least with TFSL, you get a great dividend.
Appreciate the idea. I’ll look at it further, but on a quick screen it looks like it has an ROE of ~5% at 2X book (compared to CFFN at 5% at 1X book). CFFN doesn’t screen well on dividends until you look at the specials. I believe they’ve paid more than 120% of the current share price in dividends in the last 10 years.
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5 hours ago, Spekulatius said:
USB has the infamous toilet flush chart formation - down ~8.5% today. Iwonder what's up. I don't think that they are worse than PNC or BAC in terms of what they did with their security portfolio. They do have a lower CET1 ratio of 8.4% due to paying partly cash for the MUFG acquisition.
Bought a few more shares today, but won't add more.
Maybe it's this (shelf registration):
https://www.sec.gov/Archives/edgar/data/36104/000110465923031197/tm238798-1_s3asr.htm
Finally had a moment to read this entire thread, which is very useful BTW. Going into it USB was a bank that made sense to me as well, but does anyone have thoughts on micro cap local banks like CFFN? They’re clearly not the most cost efficient operation, but how do you lose money loaning to predominantly Kansas & Missouri homeowners? Also, they have about the lowest uninsured deposit base that I’ve observed.
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CVS @ $75
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50 minutes ago, CorpRaider said:
GHC, caught a fill on a limit order placed in calmer times.
Same. And I thought I was the only one on here buying this boring company at an 11% free cash yield. Also added some Fairfax.
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2 hours ago, gfp said:
We were just in town for the day doing some shopping and grabbing lunch. My wife and I are in central Virginia looking after her Mom who just had an ankle replacement surgery, plus our neighbors house back home is under construction and there are like 3 jackhammers going simultaneously for a couple weeks.
Thanks for sharing. Not sure much magic has been created by him in recent years, but agree with the notion of creating a simple and low stress environment to make decisions.
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Starter in LSXMK at the close
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17 minutes ago, Saluki said:
There are a few whales still in private hands but I doubt that Warren is interested.
Mars Candy (and dog food and Banfield Veterniary hospital chain). The founder, Forest Mars died a few years ago. The sons who run it seem competent, but that business gene seems to die out after a while (as in See's Candy) so it may be for sale one day. Each of those seems like moaty businesses.
Cargill. Buffett hates commodity business, but he doesn't seem to mind oligopolies that provide stuff to other companies (Precision castparts, Lubrizol, Paint, Bricks, machining tools).
Koch: Nope.
PC Richard and Son. 66 store white goods/electronics retailer in the Northeast. When I worked there in my 20s they had the second highest percentage of customers with a store card (after Sears), which is a great measure of customer loyalty. They also have a large wholesale division that sells appliances to property developers and mom & pop electronics stores. (He's had terrible luck with retail, except for Nebraska Furniture Mart)
State Farm is right in their wheelhouse, but it's a mutual insurance company, so I don't think they would agree to be sold. But imagine what he could do with all that float (maybe not much, since cash has been coming in faster than Buffett can send it back out, which is a good problem to have).
ALDI is privately held.
IKEA is private and seems like the kind of differentiated business that he would like. But...retail.
Probably a lot more abroad, but those are the biggest ones that I can think of operating in the US.
Subway, which is on the block currently due to the co-founders passing, although it’s likely going to be an auction. While it’s the largest restaurant chain in North America, growth has stalled in recent years. I guess it would be interesting at the right price.
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4 minutes ago, Gregmal said:
Nah still have the Keys and its still my favorite place in the world but you just cant live there full time unless you are fully committed to fried food and alcoholism. Im only like 20-30% committed to those things and my kids need a good school system and place to play/do sports/make friends.
Makes sense. Congrats on the new acquisition. As the build progresses you might have to pass along tips on the finer points of moving down to JOE country in terms of property insurance, utilities, local contractors, etc.
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4 minutes ago, Gregmal said:
Eventually moving. In between probably gonna be both a rental and a second home for a bit. Main objective was to secure a real property somewhere I could live. Backfill the financial and ROI stuff after LOL.
Sold your keys house? I guess I need to get over to JOE land instead of the keys next time I’m in this part of the country.
Hawaiian Electric and Maui Fires
in General Discussion
Posted
Exactly. And it makes me worry about anything that touches public utilities….even Berkshire has exposure as we’ve seen recently in the the Pacific Northwest, albeit evidently hived off from the parent company.