Spekulatius Posted August 8, 2019 Posted August 8, 2019 I think Buffet hates commodity business , after all they are just price takers.
rayfinkle Posted August 9, 2019 Posted August 9, 2019 Is anyone familiar with DXC? Stock is tanking today. I've followed at arms length for a while but am trying to brush up quickly. Thanks in advance!
boilermaker75 Posted August 9, 2019 Posted August 9, 2019 Wrote some BRKB 195-strike, Aug. 9 expiration puts. Wrote BRKB 197.5-strike Aug 9 expiration puts Wrote BRKB 195-strike Aug 16 expiration puts.
Spekulatius Posted August 9, 2019 Posted August 9, 2019 Is anyone familiar with DXC? Stock is tanking today. I've followed at arms length for a while but am trying to brush up quickly. Thanks in advance! Familiar is too strong of a word, but I have owned them for a little while. I was attracted by the cheap metrics. I sold after reviewing the first earnings after they announced their LXFT acquisition , which had not closed yet at that time. ( it was a negative earnings surprise). I felt this was quite complex and the business may be in rapid decline. Also, the Luxoft acquisition felt like a desperate measure. I exited flat, so avoided this dumpster fire. This company feels like a bunch of crappy IT companies held together tight duct tape. The buybacks have significantly worsened their balance sheet. I don’t feel like I have a handle if this can turn around and managment isn’t exactly inspiring either.
Gregmal Posted August 10, 2019 Posted August 10, 2019 AYR. Earnings from the cannabis companies this quarter have been incredibly robust, so I like this ahead of numbers. The peer group trades 30x EBITDA so with AYR pretty easily punching out 80-100M EBIDTA NTM, I like my chances here.
Spekulatius Posted August 13, 2019 Posted August 13, 2019 Bought back some WAB. Price seems under pressure after the secondary (GE liquidating shares they received as a merger consideration). Starter in BNTGY (Brenntag). Small adds to BRK and WMB.
villainx Posted August 13, 2019 Posted August 13, 2019 Again, Can I ask for your view on EW and its prospects? It's not a company that gets a lot of analysis or opinion.
DooDiligence Posted August 13, 2019 Posted August 13, 2019 Again, Can I ask for your view on EW and its prospects? It's not a company that gets a lot of analysis or opinion. I'm not a very good or diligent analyst & tend to go with my gut on a lot of things. My thoughts on Edwards will be riddled with bias based on the fact that it has been the single most successful investment I've ever made. I bought Edwards back in 2013 when they were going through a patent dispute over the TAVR (trans-aortal valve replacement) with Medtronic. They prevailed in the suit & have since made acquisitions which got them into mitral with the PASCAL & Cardioband products. Mitral is proving to be much more difficult but has more potential patients. Their main product is tissue vales & they also offer the newer minimally invasive trans-catheter products. The pivotal acquisition which got them into the Sapien market was done at a quarter of what Medtronic paid to acquire the same technology. The minimally invasive Sapien valve replacements are approved for use on patients who can't tolerate having their chests opened for a traditional procedure & recently the company's Sapien valve has expanded its indication to include the intermediate risk pool, and is expected to include low surgical risk patients soon. Continued domination of the tissue valve market & the expansion of indications to lower risk patients & eventual (maybe) mainstream use of minimally invasive valve replacements are what I pin my hopes on.. Sales reps are highly trained & sit in on procedures. I remember reading something that said they tied sales reps compensation to successful procedures instead of sales volume but this may be faulty memory as I can't find any reference. Gross margins have increased steadily. I like that they rely more on organic growth. Slow & steady buybacks. Executive compensation that seems aligned with shareholders. Bonuses are tied to revenue & FCF instead of earnings. Their main competitors are Medtronic, Abbott & Boston Scientific. Morningstar has a pretty comprehensive writeup with potential negatives.EW_:_Edwards_Lifesciences_Corp_Analyst_Report_|_Analyst_Report_2019-08.pdf
villainx Posted August 13, 2019 Posted August 13, 2019 Again, Can I ask for your view on EW and its prospects? It's not a company that gets a lot of analysis or opinion. I'm not a very good or diligent analyst & tend to go with my gut on a lot of things. My thoughts on Edwards will be riddled with bias based on the fact that it has been the single most successful investment I've ever made. .... Thanks! I've been looking at it for awhile, but haven't gotten super comfortable yet.
DooDiligence Posted August 13, 2019 Posted August 13, 2019 Again, Can I ask for your view on EW and its prospects? It's not a company that gets a lot of analysis or opinion. I'm not a very good or diligent analyst & tend to go with my gut on a lot of things. My thoughts on Edwards will be riddled with bias based on the fact that it has been the single most successful investment I've ever made. .... Thanks! I've been looking at it for awhile, but haven't gotten super comfortable yet. I think the price is way too high ATM & I sell a little every now & then to keep the allocation down. It just keeps going up.
TwoCitiesCapital Posted August 13, 2019 Posted August 13, 2019 Cash. Following the sale of 20% of my S&P 500 puts. Waiting for 30+ VIX to sell more. Repurchased put positions.
Foreign Tuffett Posted August 13, 2019 Posted August 13, 2019 PCG puts, wish me luck. Could you share your thesis for this trade?
Ahab Posted August 13, 2019 Posted August 13, 2019 I think the market is being far too optimistic about the equity value that remains for current shareholders. PG&E needs a lot of capital both to invest in the business and resolve legal liabilities. Moreover, the market may be underestimating the amount of money that needs to go to fire victims (i.e the ongoing dispute over the cause of the Tubbs fire). Ultimately, my base case is that a creditor plan wins out and they extract a large share of the equity.
Spekulatius Posted August 13, 2019 Posted August 13, 2019 CVET Another “crappola” spin-off. What is the thesis now, since the initial thesis of a software subscription business seems to busted? Or is this thesis still intact in your opinion?
Broeb22 Posted August 14, 2019 Posted August 14, 2019 CVET Another “crappola” spin-off. What is the thesis now, since the initial thesis of a software subscription business seems to busted? Or is this thesis still intact in your opinion? Was the thesis ever that this was a software subscription business? Maybe your opinion of CVET is shared by others, which makes my thesis more plausible that the business fundamentals will be strong for a long time while being hard to understand in the present, and potentially a source of excess returns. But that's what makes a market.
Spekulatius Posted August 14, 2019 Posted August 14, 2019 CVET Another “crappola” spin-off. What is the thesis now, since the initial thesis of a software subscription business seems to busted? Or is this thesis still intact in your opinion? Was the thesis ever that this was a software subscription business? Maybe your opinion of CVET is shared by others, which makes my thesis more plausible that the business fundamentals will be strong for a long time while being hard to understand in the present, and potentially a source of excess returns. But that's what makes a market. Yes, I believe that was the thesis. But this software business is small and the company is loaded with debt. early indication are that the business doesn’t generate much cash. If you are just interested in the distribution business, you can buy PDCO, which although it is not a pure play on animal health, trades at a very undemanding valuation.
Broeb22 Posted August 14, 2019 Posted August 14, 2019 Based on my analysis, which I am quite certain you won't rely on, CVET offers a superior value proposition to its customers, vets. It does so by offering lower inventory carrying costs and bringing the vet practice incremental sales they otherwise would not earn. Vets currently charge exorbitant prices for their prescriptions because much of the inventory moves slow at the individual practice level, but a company like CVET can aggregate the demand of its vets, generate better inventory turns at lower gross margins, and still earn a respectable ROE. The lower gross margin CVET can charge relative to the individual practice is what drives the sales boost for the vet practice. The prescription mgmt. side of CVET is more than anything a means to drive higher sales from the distribution business. The existing distribution business and its sales reps should also drive the adoption of CVET's prescription mgmt. business internationally, which the company is building its capabilities for right now. Yes, the debt is very high. That is an admitted risk for a small position, and one I offset at the portfolio level with a decent amount of cash. I guess when you boil it down, I believe CVET will earn above-market growth due to the better value prop outlined above, will get some additional gravy from their software-type business, and they operate in a market that grows above inflation with a multi-decade record of doing so.
CorpRaider Posted August 14, 2019 Posted August 14, 2019 Had an outstanding limit order fill on $TPR...kind of conflicted about that, but that's probably why I let system 2 put the order in some time ago. :'(
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