Jump to content

Fairfax's break even share price for RIMM


nwoodman

Recommended Posts

Given they now own 51.9m shares of RIMM,  I believe their break even to be under $20. Does anyone have a more accurate estimate as at Q3?  Thanks in advance

 

nwoodman

 

From gurufocus.com:

 

Period        Bought/Sold (Sh.)  Qtr. End Shares    Avrg. Price        Gain (%)

2010Q3      +2,065,000            2,065,000            $50.14              -79.5%

2011Q2      +6,308,300            8,373,300            $43.59              -76.5%

2011Q3      +3,425,000            11,798,300            $26.61              -61.4%

2011Q4      +1,000,000            12,798,300            $18.88              -45.7%

2012Q1      +14,050,200          26,848,500            $15.05              -31.8%

2012Q3      +25,006,200          51,854,700            $7.22                42.1%

Shares Bought: 51,854,700 Average Price: $16.98/share -40%

Average Costs 51,854,700 Average Cost: $17/share -40%

Current Price: $10.26

 

giofranchi

 

Link to comment
Share on other sites

It didn't look that bad,...and I felt watching the presentation, that it's quiet promising.

 

 

It indeed does look promising.  Heins was initially our show stopper but we think we get him now.  We picked up a very small position in RIMM when they were trading sub $7. However we have been adding to our relatively large FFH position below $370, the recent sell off making it much easier. We have come to the conclusion that RIMM can a be viable option for 3rd place which is crazy if you paid >$60/share  but works <$20/share

Link to comment
Share on other sites

Given they now own 51.9m shares of RIMM,  I believe their break even to be under $20. Does anyone have a more accurate estimate as at Q3?  Thanks in advance

 

nwoodman

 

From gurufocus.com:

 

Period        Bought/Sold (Sh.)  Qtr. End Shares    Avrg. Price        Gain (%)

2010Q3      +2,065,000            2,065,000            $50.14              -79.5%

2011Q2      +6,308,300            8,373,300            $43.59              -76.5%

2011Q3      +3,425,000            11,798,300            $26.61              -61.4%

2011Q4      +1,000,000            12,798,300            $18.88              -45.7%

2012Q1      +14,050,200          26,848,500            $15.05              -31.8%

2012Q3      +25,006,200          51,854,700            $7.22                42.1%

Shares Bought: 51,854,700 Average Price: $16.98/share -40%

Average Costs 51,854,700 Average Cost: $17/share -40%

Current Price: $10.26

 

giofranchi

 

Quoted price on the TSX yesterday hit 12.00.... Happy Thanksgiving.

Link to comment
Share on other sites

the gurufocus buy and sell prices reflect average prices for the quarter, think it would be more prudent/accurate to review the prices of each quarter and assume that fairfax purchased closer to the bottom of the quarterly ranges, which can make quite a bit of difference if the price dropped significantly during a quarter, which is exactly what happened with rimm during several quarters.....

 

regards

rijk

Link to comment
Share on other sites

prem didn't buy it to sell near term.....and if he really needed to sell he would....nothing can really stop him

 

No, he definitely did not join to sell near-term.  Otherwise he would not have joined the board.  He's in this for the long-haul...whatever the final outcome.  Cheers!

Link to comment
Share on other sites

prem didn't buy it to sell near term.....and if he really needed to sell he would....nothing can really stop him

 

 

Divided loyalty is what will stop him.  Is he more loyal to FFH shareholders who are bleeding capital from this purchase, or is he more loyal to his colleagues on the RIMM board?

 

Personally, I was happier when it was 100% clear who he was working for.

 

SJ

Link to comment
Share on other sites

prem didn't buy it to sell near term.....and if he really needed to sell he would....nothing can really stop him

 

 

Divided loyalty is what will stop him.  Is he more loyal to FFH shareholders who are bleeding capital from this purchase, or is he more loyal to his colleagues on the RIMM board?

 

Personally, I was happier when it was 100% clear who he was working for.

 

SJ

 

How are interests not aligned?  RIMM is a big investment for Fairfax and he's CEO of Fairfax and steps in to help RIMM.  Thus if he helps RIMM, he helps Fairfax. 

 

The RIMM investment is a sunk cost.  How do you get as much of your investment out of it now is the question, and that is why Prem is in there...at best he saves it, at worst some damage control.  It's clear who he is working for as he is not CEO of RIMM.  Cheers!

Link to comment
Share on other sites

prem didn't buy it to sell near term.....and if he really needed to sell he would....nothing can really stop him

 

 

Divided loyalty is what will stop him.  Is he more loyal to FFH shareholders who are bleeding capital from this purchase, or is he more loyal to his colleagues on the RIMM board?

 

Personally, I was happier when it was 100% clear who he was working for.

 

SJ

 

How are interests not aligned?  RIMM is a big investment for Fairfax and he's CEO of Fairfax and steps in to help RIMM.  Thus if he helps RIMM, he helps Fairfax. 

 

The RIMM investment is a sunk cost.  How do you get as much of your investment out of it now is the question, and that is why Prem is in there...at best he saves it, at worst some damage control.  It's clear who he is working for as he is not CEO of RIMM.  Cheers!

 

As I don't hold shares of RIMM or FFH (or really follow them, other than what I read on here) I have a question. Any board fees that Prem earns, who gets them? Do they go into Prem's pocket, or, are they going into FFH as revenue, since the only reason he is on the board, is due to his role in FFH? Or, does he work on the RIMM board for free?

 

 

Link to comment
Share on other sites

prem didn't buy it to sell near term.....and if he really needed to sell he would....nothing can really stop him

 

 

Divided loyalty is what will stop him.  Is he more loyal to FFH shareholders who are bleeding capital from this purchase, or is he more loyal to his colleagues on the RIMM board?

 

Personally, I was happier when it was 100% clear who he was working for.

 

SJ

 

How are interests not aligned?  RIMM is a big investment for Fairfax and he's CEO of Fairfax and steps in to help RIMM.  Thus if he helps RIMM, he helps Fairfax. 

 

The RIMM investment is a sunk cost.  How do you get as much of your investment out of it now is the question, and that is why Prem is in there...at best he saves it, at worst some damage control.  It's clear who he is working for as he is not CEO of RIMM.  Cheers!

 

As I don't hold shares of RIMM or FFH (or really follow them, other than what I read on here) I have a question. Any board fees that Prem earns, who gets them? Do they go into Prem's pocket, or, are they going into FFH as revenue, since the only reason he is on the board, is due to his role in FFH? Or, does he work on the RIMM board for free?

 

Was Warren Buffett's director fees at Coca-cola going into his pockets or Berkshire's general coffers?  Also, are their fees greater than their compensation or ownership at their respective companies, or significantly less? 

 

In Prem's case, his salary, dividends and ownership interest are all far higher than any compensation he receives from RIMM...not even close on any of those three metrics.  In Buffett's case, his Coca-cola director's fee was greater than his salary from Berkshire...would you say that Buffett was compromised in any manner when he served on Coca-cola's board?  The stick you guys are trying to carry is a bar held so high that hardly any CEO could pass muster over a long career...even Buffett would have failed the director's fee challenge.  Cheers!

Link to comment
Share on other sites

  • 3 weeks later...
  • 1 month later...

Looks like Prem is back to even on RIMM. Investing in handset companies has been like walking through a minefield for the last decade.It appears that the smartest strategy HAS been to just sell the heck out of who ever have been the perceived winner by MR. mkt. No one has been able to hold onto mkt leadership. The consumer has been pretty fickle.

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
×
×
  • Create New...