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We Don't Need No Stinking Guidance or The Blind Leading the Blind


DooDiligence
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I read the Outsiders a few months back & loved the idea that a guy like Henry Singletary would view dealing with analysts as a waste of time.

 

This kind of attitude used to make me think that management was not "shareholder friendly" & now I see it as being potentially the very opposite (concentrate on running the business & the results will take care of the shareholders.)

 

Do you guys have any current management teams you admire for getting things done while blowing off conference calls & guidance?

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You have to be careful though. The "Outsiders" "We Don't Need No Stinking Guidance" CEO could be a real deal or could be a scammer who just wants to blow off the investors. Distinguishing the two is not as easy as the 20-years-after Monday morning quarterbacks make it appear.

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You have to be careful though. The "Outsiders" "We Don't Need No Stinking Guidance" CEO could be a real deal or could be a scammer who just wants to blow off the investors. Distinguishing the two is not as easy as the 20-years-after Monday morning quarterbacks make it appear.

 

I agree; I've been trying every search term I can think of & don't get too many leads out of Google.

 

Any tips for finding these type of companies?

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You have to be careful though. The "Outsiders" "We Don't Need No Stinking Guidance" CEO could be a real deal or could be a scammer who just wants to blow off the investors. Distinguishing the two is not as easy as the 20-years-after Monday morning quarterbacks make it appear.

 

I agree; I've been trying every search term I can think of & don't get too many leads out of Google.

 

Any tips for finding these type of companies?

There are very few of those companies. If you don't hold calls and presentations and do the dance you piss off the investment banks. So you can have that type of attitude if you don't need or care for access to capital markets. Also if you piss off investment banks they won't give you analysts to pump your stock. Most companies pay executives with stock/options so they want the pump even if they don't need to tap capital markets.

 

For example BRK doesn't have do the calls but they don't need cap markets access because they self finance. They also don't want the pump and don't need it because they don't issue stock options. As a result Berkshire which is like what, the 5th largest company in the world or something like that has about 5 analysts covering it. Blackberry which is a $4 B company has about 30 analysts covering it. A couple of years ago it was more like 70 analysts.

 

But i agree. Quarterly calls are getting worse and worse. Lately it's just management teams telling analysts what numbers to pug into each cell in their models. What a waste of time!

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CACC seems like a decent example. They skip the whole prepared remarks part of calls, repeat the same things over and over, and sometimes buttons heads with analysts. They strike me as data driven, so they don't go out on limbs on the calls making claims they can't back up.

 

Generally shareholder friendly though. Good shareholder letters (a bit repetitive, but a lot of big picture things that shouldn't change much year to year), good shareholder Q&A on webaite, great performance.

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