ourkid8

I recently sold 50% of my position in SHLD for $64.50. My justification is in the SHLD thread...

Is anyone adding to their portfolio? BAC and AIG options are looking mighty tempting... :) Tks, S

Mine is ATPG and FTR for the similar reasons you listed below. I learned to stay away from companies with high leverage. Tks, S

I am pretty sure Fairfax does not depend heavily on Prem but there is a comittee for full sized equity positions and acquisitions. He makes the ultimate decision but there is a comittee in place which will help with succession planning. Tks, S

If that capital was used to purchase additional shares in another company we would be capturing the rate of return on that investment. Why can't we look at the rate of return on this capital being returned via repurchasing your own stock? Tks, S

I agree, especially at an average price of $370.15/share! (It is a 13% rate of return on the repurchase)

Don't forget the potential ILFC IPO as that should be around the corner!

My bet is Sandridge. Now that the CEO explained the funding situation and the vast acreage they control, this could be a home run as long as they can execute!!! We already know Sanjeev has a 5-10% position in it already. Tks, S

I do not have the exact figures in front of me but I am sitting on around 12% cash. (This is my highest cash balance ever) At the same time, I am also paying down my leverage quite aggressively otherwise my cash holdings would be a bit higher. The joys of waiting for the next fat pitch!!! :) Tks, S

As per the Second Quarter 2013 report, Berkshire has $31.2B in cash and cash equivalents. This is down from Dec 31, 2012 balance of $42.4B. (Reduction of 36%) Definitely not sitting on record cash amounts... Tks, S I could be wrong. This is where I read it - http://blogs.wsj.com/moneybeat/2013/07/21/investors-struggle-with-cash-conundrum/ Are they missing something?

China National Tobacco Corporation - It enjoys a virtual monopoly in China, which accounts for roughly 30% of the world’s total consumption of cigarettes. China Tobacco caters to its customer base of 350 million smokers, who consume 1.7 trillion cigarettes every year. Unbelievable!

Happy birthday bud! Thanks a lot for everything. Tks, S

Is that something you like happen to be Sandridge? :-) No, only about 5% of it into something we like. I was hoping we'd see at least a week long market meltdown...no such luck. Maybe next week! ;D Cheers!

http://mobile.reuters.com/article/idUSL5N0EV10V20130619?irpc=43 Fairfax Holdings to raise stake in Greek Eurobank Properties. This is an interesting move but not unexpected as Fairfax invests where others avoid. Tks, S

Exactly, I am not smart enough to determine if the market will sell off or not. I look to buy undervalued companies which can compound for many years and I enjoy the ride. I would never try to time the market as it is a losers game. Tks, S You are probably right. You see, human brain is an excellent pattern finding machine. It is great at finding causes even there isn't a clear one.

Perhaps there is no shot at all...

Tobacco companies in general never really trade at a significant premium as there are a large number of institutional and individual investors who would never invest in them for moral and ethical reasons. I stand corrected as if PM sold for 45x earnings I would definitely sell as it would be extremely difficult to hold it at that valuation. Otherwise, this is a lifetime position which will continue to compound at an obscene rate. S Would you hold PM if it went to 45x earnings? Nobody thought KO was going to trade at 45x earnings, so they didn't need to worry about valuation, but it did.

I am going to go on a limb and disagree with most of you guys as it really depends on the company. (I have to admit, these types of companies are EXTREMELY rare and when you find them to buy as much as you can) There are some companies that have all the necessary characteristics to buy and hold for life and you will be extremely well compensated. (Strong moat, pricing power, low capex, strong FCF generation, all cash being returned to shareholders etc...) The company in my portfolio that does not only meet but exceeds all those characteristics is Philip Morris International. This was spun-off from Altria (Mo) and it has been arguably one of the greatest investments to buy and hold forever. Take a look at their returns for the last 50 years and we should have similar returns for the next 50 years. Thanks, S

I love reading Francis Chou's semi-annual and annual report. They are short but straight to the point and very informative. Thanks, S

This is his Canadian fund: Chou Associates. The previous one was Chou America Funds for americans. Tks, S

Tepper Makes 'Overwhelming' Case For Markets.... http://finance.yahoo.com/video/tepper-makes-overwhelming-case-markets-124100765.html

BAC A warrants have sold off and wondering if Francis has started nibbling away? As per his semi-annual report, his average cost which he was looking to decrease was $5.88. (6% below his previous cost price) He is sitting on a lot of cash and just waiting to pounce!!! Tks, S

What a shame :) Mr. Moynihan is running this business for the long-term and doing all the right moves. That summarizes my position nicely. I want the stock to go up fast, or I wouldn't have bought Leaps. I like to see a company succeed but I have bought all the stock I will ever buy and now I want that share price up. Raising the dividend to 0.50 instead of the buybacks would have pushed the stock above $15.00 quickly, possibly even up to $20.00. Now we wait another year which means another cycle of leaps, and the frictional costs involved.

Great article and as usual CN is ahead of the pack in finding efficiencies across its network.. this is a 10% position in my portfolio which I plan to hold for life! S

You are correct and this is a great system to provide businesses with the compeititive advantage. I just hope Fairfax strives to achive the AAA credit rating to help all their current and future subs have this wonderful competitive advantage. S From what I remember, BRK issues the debt to get the low rate. They then add 100 basis points for Clayton to use the funds.