Jump to content

Leukadia anybody?


Alekbaylee
 Share

Recommended Posts

At these prices, I hope to make it a 100% position soon :)

 

i dont know, luk is awfully light on operating businesses, & what they do have is very geared to a strong economy. same with their major investees, jef & acf.

 

i wish they would stop placing so much of their excess funds with 3rd party money mangers & do it on their own. and a few more cash generating operating subs would be nice.

Link to comment
Share on other sites

"i wish they would stop placing so much of their excess funds with 3rd party money mangers & do it on their own. and a few more cash generating operating subs would be nice."

 

They've been starting to address this issue over the past 2 years. They have pretty much wound-up the 3rd party investments, except for 1 - pershing's fund invested in Target. Likewise, they said at the last meeting they have some durable operating subs with cash-flow in the pipeline, they were looking at 4 and Berkadia is in fact such a cash generating sub.

Link to comment
Share on other sites

They called it a mistake. I think it was initially a bet on Ackman himself who did the exact "same type" of deals before with Wendys and other firms - a sort of pattern of active investing to realize value from these large franchises. They even said he was a kind of genius. Unfortunately, this one blew up and Ackmann profusely apologized that it was the worst blunder of his career. Too bad the LUK guys were caught in that blunder.

Link to comment
Share on other sites

At least they've called that a mistake. Everybody do some mistakes from time to time. Here is two main categories of people:

 

1- The ones that do not recognize their mistake and keep digging themselves into some holes.

 

2- The ones that try to recognize their mistakes and learn from them (some call this "candor").

 

I think that Fairfax and Leucadia managers are in the second category.

 

 

Link to comment
Share on other sites

Okay, I admit it. I am a big fan of LUK and its primary owners/managers. However, for the value investor, there are many huge positives:

(1) LUK teaches us about value investing and about accounting.

(2) LUK managers teach us about practical management of a portfolio for people who are very risk averse. In other words, they are willing to sell too soon and they are willing to pass up a purchase at a price that is just good rather than great. They do not mind holding cash.

(3) LUK is fun. I love hearing the shareholders of acquired companies squeal about their managers selling out to LUK at a price that was too low.

(4) LUK is easy to track. The only question to ask regards the health of Cumming and Steinberg and whether they plan to continue running the company. This is great for the passive value investor who wants a reasonable return on investment, as defined by Ben Graham, and over the long term, a return better than reasonable.

(5) The managers (at least the CEO and Chairman) are honest, as near as I can tell.

(6) These guys return capital to investors from time to time in significant amounts.

(7) LUK has made a lot of money for me.

 

I am getting ready to sell my BRK.B and maybe even Fairfax and double down on LUK.

 

Best wishes,

Tex

Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...