oddballstocks

Although last tender was a significant premium and it was only 90% filled. So maybe this time will be different, not sure.

Not sure how I follow the logic. If I buy today and tender I get $10. There's the chance of the tender falling through, but they have cash on hand and insiders are tendering as well. To me the risk is it's oversubscribed and I get a pro-rata on my tender. In that case some percentage of my shares will receive $10 and then I'll have to sell the rest on the market for $5 or $6 whatever it trades at.

I'm not a huge fan of privatization, take a look at some of the European national postal companies like PostNL. There's really nothing different than in the US, the problem with the postal service is it's just like wirelines, it's become a thing of the past.

So if we're just looking off the numbers, excluding certain things how is this any different from some sort of quant based screening? I guess I'm different from most in that I like to look at the price or market cap first. I'd rather not spend a lot of time evaluating a company only to find out the company has never traded anywhere near what I'd pay. I guess to build up a watchlist of potential purchases it could be useful. I've just found there are plenty of stupid cheap companies out there I've never needed a wishlist of stocks I could only buy at market extremes.

So just trying to understand this: If one posts a summary about some company and shoots up metrics saying low P/E, P/B etc the poster is derided because there's no moat, or the competitive advantage sucks or whatever. The insinuation is the only way to look at a company's financials is in combination with what the business does. Then we have this thing of yours where you're just posting some numbers. This could be a cell phone operator in Africa, or Apple, we don't know. And we're supposed to spit out a value of what we'd pay? Is the idea to totally divorce what a company does, or the industry it's in from the price? I can see that maybe, if everyone here looked at this sheet and said "I'd pay $4b" and then it turns out to be a for-profit education company selling for $300m does that change anyone's views? If you blindly evaluated a for-profit company (example because it's a hated industry) at $4b and it's trading at $300m would you run out and buy shares because you realized you had some bias? The exercise seems like it could be useful in that regard. I wonder what people would say if they just saw RIMM's financial statements. Is the point of this to determine what a fair value is? I guess my confusion lies in the fact that a fair value for Mastercard is different from a fair value of Kopp Glass even though they have similar margins.

Great thread, I'm a deep value, Graham/Schloss investor myself, it's served me well. As for investing in Europe I use Fidelity (USA). I've run some screens and here's what I do. I search for P/B < .8, P/E < 8, D/E < .30, mcap < 200m, I like to search in France, Germany, Netherlands, Austria, there are plenty of companies to be found. I've found some great names in France, a lot of overcapitalized companies with nice ROE's once you back out excess cash. There are also some very cheap banks in France, and I mean VERY cheap. Still working on researching them myself.

Someone has more than 50% in AIG?!?!? Either they work there, they have a small portfolio, or they're crazy….wow

I've been buying French small caps, lots of good value there. I haven't found as much in Germany, but looking at one in Austria. No net-nets to speak of like Japan, but plenty of decent companies selling cheaply. I've found a lot of overcapitalized companies as well, strip out the cash and they have P/E's of 3x or so and 20% ROE.

If you excluded California, Arizona, Florida etc the US didn't look too bad either, that didn't prevent prices from falling everywhere. Some of the Rust Belt was the worst, no appreciation and large price drops, Detroit, Buffalo, Cleveland. I hope for your sake there is no bubble in Canada, but if there is it's unlikely other areas will escape especially if all the major metros are affected.

Plan, I've had similar thoughts, of course who am I a mere thousandaire compared to a billionaire, but still. I've looked at some of his deep value picks such as SCMR and walked away less than impressed. I would never buy the stocks, but he's the rich guy with the track record and I am not, so I'm not sure it matters much. My sense is his investment style has changed over time, just the size of his fund alone limits the types of things he can do. He wrote about mutual conversion investing in his book yet if he tried to buy any of the recent mutuals he'd end up owning the bank, and it wouldn't even be a blip for his fund.

JSArbitrage, you raise good points. We certainly need to be forward looking when thinking about MSFT. They do face real competitive threats, even to the OS and Office franchises that mint most of their money. But, MSFT is so entrenched at the enterprise level that those two pieces will be incredibly difficult to dislodge. IMO, they will continue to mint money there for the foreseeable future. There real problems are (and really always have been) at the consumer level, and their misses in the phone and tablet space have hurt them. But, I think Win8 has the potential to really compete well. And, they are potentially the best positioned to provide a seamless linkage of PC/mobile/tablet/TV systems. They'll be able to offer a competitive OS on all those systems that is integrated and full featured. But, they need to execute, which they haven't really been able to do well enough historically. But, I think they have a lot of potential that gets written off because they're Microsoft and not as sexy as Apple. At the risk of projecting my own experience as being representative of the general experience, let me say that I have an ipad, 2 windows PCs, one windows laptop, 3 ipods, an xbox 360, and an android smart phone. If forced to choose, I'd say you can take away everything but my windows PCs and my phone. The ipad is a great piece of consumer electronics, but to me it isn't all that useful for anything but media consumption and web surfing. From my experience windows is very nearly irreplaceable to me as a consumer. I won't be editing pictures and videos, running my media server, or storing all my files on my ipad. I think the common perception is that MSFT has been left behind and/or is dying (how could it not be, given the lost decade) and that is reflected in the price. MSFT isn't perfect, but at current prices they don't need to be. I think the problem with focusing on enterprise is the same mistake RIMM made. If consumers have Macs at home and love them that will begin to influence the enterprise. The common response to this is that the IT guys won't go for it. My experience has been the IT guys usually have Macs at home but management won't listen, this has been slowly changing. In my company the staff went from 100% PCs to about 70/30 PC/Mac. What's incredible about this number is if employees want a Mac they have to put $1k towards the cost themselves whereas the PC is "free" (employer pays). So 30% of the company decided they'd rather pay up to use something they want. Where MSFT wins out is in their big installations. Large companies that have tens of thousands of PCs and Sharepoint etc aren't going to migrate, they aren't going to migrate quickly either. I have two work laptops (both windows) and both run XP, not my choice but the company's choice. Right now if a new piece of software is proposed it takes about a year to test it before the company will adopt it and let users install it. Microsoft is the definition of inertia to me, they are so widespread even if they're a melting ice cube it could take 20-30 years before they melt away. I think their biggest challenge is the user base that has old software and refuses to update or upgrade. My experience has been the older the software the more hesitant someone is to upgrade, they're afraid of things breaking and want to test for years. So MSFT is saddled with these legacy systems that aren't generating any ongoing revenue (except maybe support) but are unwilling to upgrade either. The fact that I will get attachments from Office 97 from time to time tells the story.

Thanks for posting that, I haven't followed RIMM much but it appears they're betting the whole company on this new Blackberry 10 that comes out next year. I also noticed a few readers say they purchased the phone to support Canadian business, I'd love to see a graph showing Blackberry market share broken down by country, sounds like South Africa would be high.

My experience with this is brokers won't tender the same day you purchase, but will tender the next day. So if you buy on the 9th and tender on the 10th you should be ok.

I'd recommend the book Wall Street Verses America by Gary Weiss. The book's thrust is markets can't be trusted and people should invest in index funds, ignore that message. The book details a number of frauds, boiler rooms, pump and dump schemes it's really crazy. The message I got from the book is that each stock is a buyer beware no matter who talks about it. The book's a quick read, I remember reading 60% of it on a plane ride down the East Coast to Florida, round trip would be long enough to finish the thing.

+1 I started to see way too many articles about Facebook. And not even about the stock, just articles about the website. It was strange. I think he's trying to become more of a news site than a value investing site. It seems there is a lot of news about hedge funds and Apple products. I don't fault the guy for trying to make a buck, value investing is a niche product whereas general news an finance have a broader audience. If this is his livelihood then targeting a bigger population makes sense.

Why buy a European bank when you can buy a British bank and why buy a British bank when you can buy a US bank...worth considering. This has been my line of reasoning, there are some cheap European banks but there are similarly cheap and much safer American banks.

I loved that book, I should read it again, I think I last read it three years ago or so. My view is success is often based on situational specific things whereas failure patterns seem universal. This book only reinforced that. Highly recommended.

Does anyone know what he's actually investing in these days? I know he gets publicity for some of the macro calls but from what I understood he was a value guy at heart. I guess it wouldn't surprise me if he was lurking around here. He seemed to really like the message board format of Silicon Investor, it seems strange someone who was really active in that would just go cold turkey.

I wanted to dig into this a bit more and show some actual numbers. Starting with $10,000 for 20 years: 10% return: $67,274 --> We'll call this our baseline, the market return. 12% return: $96,462 --> Gross outperformance, but yes we forgot taxes, assume all capital gains are taxed at 35% yearly = $85,094 So even that small bit of outperformance is big, now take it to 30 years an investing lifetime 10% 174,494 12% (taxed) 248,230 That extra 2% even with high taxes every year adds up to 30% more over the investing lifetime, the difference grows bigger the longer the timeframe is.

This seems a bit strange, are you saying the funds that somehow outperform are taxed differently than how you would normally invest? If you can only invest in index funds in an IRA and you're doing stock picking in a taxable account I can see the argument. But if you're comparing an index fund in a taxable account vs stock picking in a taxable account I would think 2-3% is pretty significant over the long term. Especially if you hold for long term capital gains and don't churn the account.

...and just continue to use up that virtue Charlie Munger was talking about. Then one day, there isn't enough virtue left. Maybe I'm just dense but what the heck does that even mean?

The commentary on gov debt is interesting, and it's easy to get buy into the storyline as well. One thing that always rattles around the back of my mind was the story from the Snowball about Buffett's uncle who was worried the US would default after WWII and bought a farm out in Nebraska. Up to the day of his death he was talking about how the US was going bankrupt. Ever since the 1940s people have been worried about this, so I'm not sure this time is any different. In the past we paid inflated it down, so I'm not sure why we wouldn't this time either.

I think both of these things show that the Japanese are willing to do both the best thing and the right thing. The tax isn't ideal, but they need to get the financial house in order. I always love when people trot out the Japan is dead lines and it involves the linear reasoning if A happens then B then C then D then implosion. First most things never play out in a linear fashion as "experts" expect, and second Japan is one of the most developed countries in the world. There are a lot of things they can do to fix their fiscal problems, they haven't even begun to exhaust their options. And the demographics? Well couples can be encouraged to have more kids. The Japanese are resilient and when pushed to the wall I think they'll do what it takes. Just my thoughts, of course I'm also invested over there, so I'm putting my money where my mouth is.

Anyone go to http://www.berkshirehathaway.com this morning? Seems that either their domain expired and a squatter got it or they were hacked. Either way I'm guessing someone is going to be getting a nice fat payday out of this one. Beware lots of popups, I will say though whoever did this targeted the ads nicely.

I think there's a big difference here--now it is duplication not solely on the server. If the network is down, you still have your latest updated files. I assure you, the processing power of the macbook pro does not qualify as a "dumb terminal" =p. Obviously... The biggest thing for me with the cloud is who owns the data and what can be done with it? There is a big grey area on these things right now, both Google and Apple claim the right to modify and redistribute as well as create derivative works. They also claim the ability to delete objectionable material as they deem fit. And lastly they can turn over your data to law enforcement without your permission. Why does this matter? What if you are accused of something Google or Apple might cough up the data without question or without a court order. And of course the last concern is hacking and data privacy. If I only have files on my own computer I am responsible for security, and someone needs to specifically target me. If I use a cloud thing and Apple or Google are compromised private or confidential files could be made public due to a lack of security on someone else's part. And don't think that the document clouds won't be targeted, they're like giant honeypots. Imagine the information stored in there if someone cracks it, a scary thought.