Best Idea(s) for 2025

[Sweet]

17 minutes ago, Gregmal said:

Everyone always says this time is different. Go back 4 years. In May 2020, pretty much at the bottom, there was a huge clan of Buffett parrots who used the excuse “Buffett is selling hand over fist and said he isn’t ruling out another Great Depression at the AGM” for missing it all. 
 

When there isn’t Buffett to play the appeal to authority card, there’s always the Gundlach, Drunkenmiller, etc crowd to cite. 
 

Neither bullish nor bearish I just don’t think folks help themselves at all appealing to authority or playing into their biases. Just put your head down and look for places and ideas that should work. 
 

Separately but relatedly, it’s a very obvious giveaway in regards to who is being lazy because the dead giveaway is just pointing to “the index”. Dissect the index or many different areas and sectors, there is a TON that’s not expensive or “in a bubble”….so yes, calling a top based on index levels is the epitome of lazy and uneducated, and should have near zero bearing on one’s ability to find investments. But when one’s wound themselves up thinking the indexes are a bubble that’s about to pop, it’s easy to see why they confuse this with a widespread “don’t go in the water” alert.

 

I mostly agree you.  I was fully invested I believe in 2020 right the way to mid 2024.  I made a lot of money during that period.  Now I don’t see the easy money.  I see cheap companies that I don’t really know much about.

[KPO]

47 minutes ago, Dinar said:

GMBXF is very interesting.  What do you think of controlling shareholders?  Are you valuing it on a sum of the parts basis?  How are you looking at valuation?  Thank you.

While the copper businesses have had some safety issues in the past, I don’t see any financial governance issues that concern me. My one critique would be around repurchases. Given the SOTP value is more than 50% over the current quote and they have very limited leverage, I’d like to see repurchases here. They’ve really only done small repurchases in the past, but they also haven’t issued shares either. 

[Junior R]

1 hour ago, Gregmal said:

Like I hate energy, period. But nothing in the entire energy space is expensive at all. Even remotely. Got cash? Go sift through energy companies and sort the top 10% in terms of quality, ie balance sheet, management quality, historical cashflow, asset location, etc.

 

Problem solved. Energy just one example, you can do this with many different sectors. Or you can talk about the index and let the influence of like 8 stocks keep you on the sidelines. 

lol yeah thats where the problem starts with valuation everyone looking at the index lol

Edited December 30, 2024 by Junior R

[Blake Hampton]

1 hour ago, Gregmal said:

Like I hate energy, period. But nothing in the entire energy space is expensive at all. Even remotely. Got cash? Go sift through energy companies and sort the top 10% in terms of quality, ie balance sheet, management quality, historical cashflow, asset location, etc.

 

Problem solved. Energy just one example, you can do this with many different sectors. Or you can talk about the index and let the influence of like 8 stocks keep you on the sidelines. 

I’m genuinely curious as to why you hate energy. I’ve heard you make jabs at the value of the dollar in past posts, and oil is historically one of the best inflation hedges.

 

These two factors alone would make me think you’d at least be interested. 

[Gregmal]

6 minutes ago, Blake Hampton said:

I’m genuinely curious as to why you hate energy. I’ve heard you make jabs at the value of the dollar in past posts, and oil is historically one of the best inflation hedges.

 

These two factors alone would make me think you’d at least be interested. 

Cuz most of them are awful allocators. Drill baby drill ain’t a slogan, it’s a lifestyle. At the large cap there’s too much ahead of shareholders in the food chain, and the small caps are largely just ticking time bombs. 
 

If you could find a pure royalty, that could work, and it did for a while with TPL, but then the scammers took that too. 

[Blake Hampton]

2 minutes ago, Gregmal said:

Cuz most of them are awful allocators. Drill baby drill ain’t a slogan, it’s a lifestyle. At the large cap there’s too much ahead of shareholders in the food chain, and the small caps are largely just ticking time bombs. 
 

If you could find a pure royalty, that could work, and it did for a while with TPL, but then the scammers took that too. 

What do you think about BRY?

 

Also I would agree that this is a problem. But oil isn't the worst asset, it's just when the companies over-do it to the point where they're in a financially precarious state. Then some shock comes and just wipes em all out.

Edited December 30, 2024 by Blake Hampton

[Gregmal]

Haven’t looked at BRY enough to give you an opinion worth a damn. If you think they can produce the FCF they seem to be projecting it’ll surely do well. 
 

But yea, oil needs to be managed/scouted, extracted and transported. By itself? Oil is a great asset. But the industry itself is just full of cowboys. You ultimately need them, but then you live and die with them and not many have thru the cycle discipline. Let alone incentives. These guys think that the end result of successful drilling is that you have more money to drill lol. Cycle turns, poof. 

[SafetyinNumbers]

11 minutes ago, Gregmal said:

Cuz most of them are awful allocators. Drill baby drill ain’t a slogan, it’s a lifestyle. At the large cap there’s too much ahead of shareholders in the food chain, and the small caps are largely just ticking time bombs. 
 

If you could find a pure royalty, that could work, and it did for a while with TPL, but then the scammers took that too. 

If you are looking for top shelf capital allocation skills in oil, I suggest checking out Strathcona’s Investor Day presentation. The first 48 minutes is a master class by Adam Waterous on energy investing through a value/quality lens. At $70 oil, they plan to return C$26/sh to shareholders over the next 6 years while growing production over 50%. 
 

WEF, the private equity fund founded by Adam, controls 91% of the shares and plans to start passing them through to LP holders in March. The increased float will make SCR eventually eligible for the S&P/TSX Composite which should help with a rerate closer to NAV but I plan to hold on for a long time.

 

WEF also recently took control of Greenfire Resources, another oil sands company with a strong growth profile. That company is undergoing a strategic review so I expect we’ll see some news over the next 3-6months.

 

SCR and GFR are ~6.5% & ~5% positions, respectively, for me. 
 

[Dalal.Holdings]

"All of humanity's problems stem from mans' inability to sit quietly in a room"

 

Do something syndrome is a strong force. Sometimes, it's best to do nothing. I know, it's quite a radical notion, but I ain't swinging unless I see a fat pitch.

[Gregmal]

@SharperDingaanis definitely the guy who’s brain Id pick on energy investing. Rule of thumb imo has always been pillar 1 of any thesis is how to get all your money out in 3-4 years max. 
 

Anecdotally I’m now pushing 20 years in the market and frankly never been impressed with outcomes. T Boone Pickens was considered a legend and every name I followed of his had a magnet to doughnutville. Lee Cooperman always talks energy and gets spanked. Icahn, very little to show. So idk, best outcomes over my time have basically just been the small shop guys who tread water and then once or twice every 5-7 years hit the turn and make a fortune. Few I’m aware of who just have quiet and consistent above average returns. 

[SafetyinNumbers]

55 minutes ago, Dalal.Holdings said:

 

"All of humanity's problems stem from mans' inability to sit quietly in a room"

 

Do something syndrome is a strong force. Sometimes, it's best to do nothing. I know, it's quite a radical notion, but I ain't swinging unless I see a fat pitch.

Some people don’t know a fat pitch when they see one. Still surprised how many investors own BRK and MKL but no FFH.

[SharperDingaan]

1 hour ago, Blake Hampton said:

I’m genuinely curious as to why you hate energy. I’ve heard you make jabs at the value of the dollar in past posts, and oil is historically one of the best inflation hedges.

These two factors alone would make me think you’d at least be interested. 

 

Couple of takeaways to keep in mind.

1) Always focus on just ONE area, and swim lane; WCSB, Permian, Off-Shore, etc. The do one thing very well .... versus doing many things just 'OK'.

2) You are primarily looking to the direction of future oil/gas prices, not the quality of management; liner or row-boat, everything does better on a rising tide.

3) Make sure that you have very good risk management. You have to be able to survive to thrive, and not be the 'road-kill'.

4) With very few exceptions, don't fall in love. Trade the cycle, and only swing-trade if you intend to marry.   

5) Be able to think for yourself, and across multiple time horizons simultaneously. 

 

Most people don't have the risk management necessary. Too much invested, over too short a time-frame, and with too little 'think'; all hat and no cattle 

 

What happens in the Permian ISN'T what happens in the WCSB. Lax discipline wiped everyone out decades ago; today's companies are run by the survivors, they are much better run than many US counterparts, the scars go deep, and nobody wants to repeat the busts. You may have fooled me once, but it ain't gonna happen again!; a lot of Calgary/Edmonton families have kin that were wiped out in previous booms/busts. 

 

Most folk would expect WTI to more or less trade within an average USD 55-75/bbl range for the next 5 years. Existing production only maintained &/or slowly blown down, with returning capex going primarily into buy-backs and field consolidation; additional drilling mostly just matching depletion, versus adding NET new production. Better deals in the WCSB as new pipe continues to lower differentials (increasing netbacks), the falling dollar raises CAD revenue (increasing netbacks), and the many haters have reduced share prices to ridiculous metrics (low cost base). A moderate improvement, and even a monkey will look like an Einstein (rising tide).

 

Quite a few very good operators within the WCSB. Obviously the big oil sand players, but we would put quite a few others up there as well. Most all of them come up routinely on COBF and on a fairly regular basis. The pending change in Canada's federal government, and Trump doing his thing in the US, just adding to the opportunity.

 

Do your DD, take your time, manage your risk, and you should do well. Good luck!

 

SD

 

 

  

[Blake Hampton]

[james22]

5 hours ago, Dalal.Holdings said:

 

"All of humanity's problems stem from mans' inability to sit quietly in a room"

 

Do something syndrome is a strong force. Sometimes, it's best to do nothing. I know, it's quite a radical notion, but I ain't swinging unless I see a fat pitch.

 

Could you give us an example of a fat pitch you've swung on, please?

[Dalal.Holdings]

2 hours ago, james22 said:

 

Could you give us an example of a fat pitch you've swung on, please?

 

$WLN.PA

[Spooky]

Definitely feels like the narrative is shifting. Everyone and their brother writing about how US stocks are overvalued. Investor psychology going to shift and all that momentum will work in reverse.

 

[kab60]

There is always something to do unless one has a humongous stack. Seeing Nvidia, Microstrategy et al, I do however get 2021 vibes. I sold basically all of my remaining US holdings in November and am now basically invested in Canada and UK. I just find much better opportunities there currently, and they are catching up to the US on the capital allocation front (somewhat... But we just need a few ideas...).

 

Best ideas are IPCO.TO, NOA.TO, MATR.TO, LNR.TO, Intred SpA, Zegona Comm, Sabre Insurance, Kitwave, Midwich... And a bunch of UK special sits 

[jefke]

TIGO, AER, SCR.TO

[Luke]

Im going to throw in PDD!

[Paarslaars]

I also like PDD, just not sure 2025 will be their year.

[jfan]

On 12/30/2024 at 1:21 PM, Gregmal said:

If you could find a pure royalty, that could work, and it did for a while with TPL, but then the scammers took that too.

Are you referring to Murray Stahl specifically or the rest of the TPL board? 

 

Have you looked at prairiesky, it's a pure Canadian oil and gas royalty company (but no surface rights however)?

Edited 10 hours ago by jfan