Picasso Posted January 9, 2015 Share Posted January 9, 2015 I am curious if there are any non-typical "value" stocks in the sense of future returns dwarfing the current share price despite high P/E multiples or some other stretched surface metric. I know some on this board are big fans of the returns AMZN can provide. I guess the post should be "stocks you own but are too ashamed to share with your peers." Tesla and GoPro are my guilty stock pleasures. Link to comment Share on other sites More sharing options...
bennycx Posted January 9, 2015 Share Posted January 9, 2015 Wells Fargo (in comparison to other banks) National Oilwell Varco Link to comment Share on other sites More sharing options...
Mephistopheles Posted January 9, 2015 Share Posted January 9, 2015 GM and BAC Although, both are very popular in the value crowd. I get more satisfaction in owning stocks that have a temporarily inflated P/E rather than stocks where the numbers all look good. I find the latter a bit boring. Link to comment Share on other sites More sharing options...
Guest JoelS Posted January 9, 2015 Share Posted January 9, 2015 Discovery Communications is a possible candidate to my mind. They own a 51% stake in Eurosport which is like the ESPN of Europe. The market cap of Discovery is hovering around $US 20bn. ESPN is worth maybe $US 50bn today, so I see some potential in that ownership stake. Then you have Discovery/Animal planet, the OWN interest, TLC, and others. Link to comment Share on other sites More sharing options...
Jurgis Posted January 10, 2015 Share Posted January 10, 2015 I'll post "stocks that I think are expensive, but I hold because I think they might outperform even though they are expensive" FRMO Everything Malone (Lalphabetsoup + DISCA) DISH TDY CFX COST GILD BRK :) (not very expensive but getting there) Link to comment Share on other sites More sharing options...
Homestead31 Posted January 12, 2015 Share Posted January 12, 2015 Chef's Warehouse. several easily identifiable milestones on the horizon, commodity costs that will mean revert, an industry that will want a second fiddle to a post merger sysco, a long runway for growth through acquisition Link to comment Share on other sites More sharing options...
Guest Schwab711 Posted January 12, 2015 Share Posted January 12, 2015 FICO MCO TDG AXP GOOG Basically I think there are a lot of extremely high quality names trading at 10x - 15x EBIT are generally very cheap. The key is they must be of the highest quality. At 10x EBIT you make Warren Buffett money but 10% - 15% compounded is available currently. Link to comment Share on other sites More sharing options...
ni-co Posted January 12, 2015 Share Posted January 12, 2015 LBTYA DVA Very strong underlying cash flow growth that should be more or less recession proof. If you buy the mid term deflation thesis I'd also add EQR. Looks very expensive and Sam Zell sold $150m worth of shares back in July. But it's a hedge against inflation and deflation at the same time, and provides a higher yield than the 30y US government bond. Link to comment Share on other sites More sharing options...
thepupil Posted January 12, 2015 Share Posted January 12, 2015 LBTYA DVA Very strong underlying cash flow growth that should be more or less recession proof. If you buy the mid term deflation thesis I'd also add EQR. Looks very expensive and Sam Zell sold $150m worth of shares back in July. But it's a hedge against inflation and deflation at the same time, and provides a higher yield than the 30y US government bond. can you explain how a high multiple levered real estate company with short lease terms is a deflation hedge? Link to comment Share on other sites More sharing options...
ScottHall Posted January 12, 2015 Share Posted January 12, 2015 FB, AMZN, PCLN. Though I don't own Priceline, yet. Link to comment Share on other sites More sharing options...
ni-co Posted January 12, 2015 Share Posted January 12, 2015 LBTYA DVA Very strong underlying cash flow growth that should be more or less recession proof. If you buy the mid term deflation thesis I'd also add EQR. Looks very expensive and Sam Zell sold $150m worth of shares back in July. But it's a hedge against inflation and deflation at the same time, and provides a higher yield than the 30y US government bond. can you explain how a high multiple levered real estate company with short lease terms is a deflation hedge? This is not a general statement. Everything with stable cash flows in a low growth environment is a deflation hedge. This is not true for every REIT but refers to EQR's assets: apartments in prime locations. Currently, rents there are growing at multiples of CPI rates and I think the current rent level is (at least) sustainable for a few years because of 1. demographic developments, 2. urbanization and 3. the growing number of rich people worldwide (wanting to rent/own an apartment in NYC, for example). If EQR's cash flows are stable, it will be much more comparable to a long term government bond than to the equity market. Long term government bonds are deflation hedges. But EQR is also able to raise its coupon. I think it should trade at a premium to the 30y government bond – even in a deflationary environment and it trades at an (albeit shrinking) discount. I think there is a widespread misconception of levered assets in deflationary/slow growth environments. Leverage is only problematic when you're facing shrinking cash flows. Link to comment Share on other sites More sharing options...
thepupil Posted January 12, 2015 Share Posted January 12, 2015 fair enough. I guess I just associate deflation with economic slowdown and I don't think any real estate asset, regardless of quality, is immune to decreasing rent. Washington DC (EQR's largest exposure) has already seen a bit of a rough patch and rents have come down by a hair (DC metro area revenue was down 0.5%, looking at their recent presentation). Associating short lease real estate with treasuries tingles my spidey sense but the crazy rise in the REIT index so far proves my spidey sense without merit. Triple net lease to a bunch of Walgreens and BoA's, yes. But not a bunch of nice yuppie apartments rented to financial analysts and government consultants. Link to comment Share on other sites More sharing options...
ni-co Posted January 12, 2015 Share Posted January 12, 2015 fair enough. I guess I just associate deflation with economic slowdown and I don't think any real estate asset, regardless of quality, is immune to decreasing rent. Washington DC (EQR's largest exposure) has already seen a bit of a rough patch and rents have come down by a hair (DC metro area revenue was down 0.5%, looking at their recent presentation). Associating short lease real estate with treasuries tingles my spidey sense but the crazy rise in the REIT index so far proves my spidey sense without merit. Triple net lease to a bunch of Walgreens and BoA's, yes. But not a bunch of nice yuppie apartments rented to financial analysts and government consultants. This was my first reaction, too. But, referring to REITs and deflation, take a look at this: http://www.smtri.jp/en/JREIT_Index/img/J-REIT_Index_graph_e.pdf Link to comment Share on other sites More sharing options...
alwaysinvert Posted January 12, 2015 Share Posted January 12, 2015 Discovery Communications is a possible candidate to my mind. They own a 51% stake in Eurosport which is like the ESPN of Europe. The market cap of Discovery is hovering around $US 20bn. ESPN is worth maybe $US 50bn today, so I see some potential in that ownership stake. Then you have Discovery/Animal planet, the OWN interest, TLC, and others. I don't think Eurosport is comparable to ESPN at all. What's their biggest rights? Cycling and some tennis coverage. For the average sports fan Eurosport is pretty much a joke, although obviously there is a niche audience for tennis, cycling, snooker, darts etc. Link to comment Share on other sites More sharing options...
yadayada Posted January 12, 2015 Share Posted January 12, 2015 yeah not many people watch soccer on eurosport. Seems ESPN has a much better thing going with american football in that regard. Link to comment Share on other sites More sharing options...
Ham Hockers Posted January 13, 2015 Share Posted January 13, 2015 I guess making VRSN and RSG my top two positions would get me laughed at around here. Link to comment Share on other sites More sharing options...
Palantir Posted January 13, 2015 Share Posted January 13, 2015 RHT, and AMZN. RHT not so much now, but when I bought in low 40s, forum members were like 60x PE....lolwut? Link to comment Share on other sites More sharing options...
Picasso Posted January 13, 2015 Author Share Posted January 13, 2015 I guess making VRSN and RSG my top two positions would get me laughed at around here. What do you like about RSG? I noticed some big recent buys by Michael Larson and couldn't figure out the appeal. Link to comment Share on other sites More sharing options...
krazeenyc Posted January 13, 2015 Share Posted January 13, 2015 I guess making VRSN and RSG my top two positions would get me laughed at around here. What do you like about RSG? I noticed some big recent buys by Michael Larson and couldn't figure out the appeal. FWIW, I really like RSG (I don't own it right now). It used to be a core position of mine many years ago. I think they're in a good business that has a lot of tailwinds over the long term -- mainly that we create more and more garbage! Scale is also crucial in that sector and basically only RSG and WM have enough scale -- I expect that over the long term consolidation in the sector will only continue making their business that much better. One good and bad thing -- every time RSG drops even a little bit, it seems that Cascade (Bill Gates' investment vehicle) buys it by the boatload. Link to comment Share on other sites More sharing options...
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