Great companies which fail to create shareholder value

[Spekulatius]

12 hours ago, Cod Liver Oil said:

Charts are telling. The Disney chart is damning. If you can get in front of positive changes at a dominant company that has luffed, you have a tailwind of years. Tencent has been running a great business for years but the macro has sucked; I can't blame Ma for it. Disney has a management problem which could conceivably improve. Is the IP flywheel really broken? ABNB invented a category which was genius but is kind of tired at this point. Taking out the garbage on vacation has lost its charm. Chesky's diddling won't help. Nintendo has sick IP but thinks shareholders are the great unwashed.  As the great autistic triillionaire monk has said, consider the most ironic outcome, for it is the most likely.

I actually  like  Disney and bought some shares. I think it’s one example where the fundamentals have stalled and now they improving  but Mr Market is sceptical and hence the stock has not reacted yet. At least that’s the story the chart is telling me. I could be wrong  and it’s a false start but I think there is a good chance that the future is a whole lot better than the past.

Edited 1 hour ago by Spekulatius

[John Hjorth]

14 hours ago, Loss Horizon said:

Luxury vehicles do contain fair share of value in form of materials and labor. So do boats and private jets.

 

Luxury fashion items on the other hand contain very little besides the label. That is obviously enough for many, but I don't trust this model for the future.

 

@Loss Horizon,

 

Luxury companies in reality have the ability to tax human vanity!  - Fragile business model 

[Spekulatius]

Even if you buy a “great company”, the timing is extremely important as value does not necessarily to accrue proportional to intrinsic value. A great company can be a bad investment when bought at a too high valuation at the worn time. this has always been true but we went through a period from 2010 to 2021 where in general multiples were generally expanding for quality company across the board , so it seemed like this self evident law was not valid any more.  However, it should be obvious to anyone that you can just as well overpay for a quality stock than any one stock.