What are you buying today?

[giofranchi]

FFH likely doesn't have the same muddle-through returns as 20% by next January, because I think most of the multiple expansion has already happened.

 

I agree. Period.

 

But I would also add that, when I buy a business, what happens from April until January of the next year is only part of the picture. And multiple expansion is only the frost on the cake.

 

GLRE and TPRE are the only two I know of that are cheaper and have significant equity hedges. Of course you are already aware of them.

 

No, I don’t think either GLRE or TPRE are as well positioned as FFH. I don’t think OAK is as well positioned as FFH. I don’t think KO nor other blue chips are as well positioned as FFH.

If we really end-up having deflation, it is true GLRE, TPRE, OAK, and KO will still make some money, but will most probably surprise on the downside.

FFH’s business results, instead, might very well surprise on the upside.

 

This is very important imo, not because FFH’s stock price will perform better than the rest… If I am invested in FFH today, it is precisely because I am agnostic about stock price movements… I simply don’t know how stock prices will move. Instead, it is important because FFH in that situation might come to possess the wherewithal to buy lots of greatly productive assets at bargain prices. Much more than GLRE, TPRE, OAK, and KO will be able to do.

 

Carnegie, Rockefeller, Mellon, etc. all have become fabulously rich that way. No one knows if that will happen again. But, even if there were only very slight chances, I want to participate.

 

Cheers,

 

Gio

 

[meiroy]

 

When the market really crashes reflexivity becomes far more dominant with any problems in the capital structure becoming much more obvious. I would not expect FFH or any such large company to have strong enough buyer of last resort with the interest to keep it significantly over the general market.

 

 

[giofranchi]

When the market really crashes reflexivity becomes far more dominant with any problems in the capital structure becoming much more obvious. I would not expect FFH or any such large company to have strong enough buyer of last resort with the interest to keep it significantly over the general market.

 

You are talking about the FFH stock price. I don’t talk about what a stock price will do in the future.

 

Instead, I am talking about the billions from its bonds portfolio, its equity hedges, and its CPI-linked derivative contracts.

 

And about the assets FFH might be able to buy with those billions.

 

Cheers,

 

Gio

 

[no_free_lunch]

I bought a decently sized position in Open Text today.  They do digital document management and are expanding out from there.  It is a well run, fast growing company (15%+) going for about 15-16x fcf.  ROE is about 25%.  It has been mentioned by Donville Kent and Turtle Creek, both of whom have outstanding long-term records.  Stock sold off on a weak quarter and currency effects.  Should be a good long-term hold.

[KCLarkin]

I bought a decently sized position in Open Text today.

 

I was trying to buy this morning but it bounced before I could get in. Seems to frequently have a sharp gap down and then a sharp rebound. Still down ~6% so I hope to accumulate.

[no_free_lunch]

Even where it is trading right this minute, $52.08, I think it is an incredible bargain.    Based on the most recent quarter, free cash flow is annualized around $450M.  So the company is trading in the vicinity of 15x fcf.    It really should trade for at least 20x, given if nothing else that it has strong recurring revenue.  When you factor in management's ability to acquire and control costs, it should probably trade at more of a growth multiple, likely 25-30x.

[giofranchi]

I have just bought more PSH.

 

Cheers,

 

Gio

[bargainhunter]

Just significantly increased my position in SNMX. As per today's earnings release Pepsi commercialization is on track for mid 2015. Just as important, direct sales are ramping up. Look at the trend in sales wins over the past several quarters. 0, 1, 3, 6. We are on the cusp of a major ramping up in revenues here.

[muscleman]

I converted USD into EUR, wired to Fidelity and bought a meaningful stake in Bank of Cyprus.  :D

 

[frommi]

Bought CHEF and QQQ puts.

[Ross812]

Bought CHEF and QQQ puts.

 

I have a gtc buy order in for 17.5 on CHEF. Rinse and repeat on this one. The $23 month out options were going for $1.3 in March. I couldn't resist...

[frommi]

Bought CHEF and QQQ puts.

 

I have a gtc buy order in for 17.5 on CHEF. Rinse and repeat on this one. The $23 month out options were going for $1.3 in March. I couldn't resist...

 

I once had a limit order in for FIAT. Guess what happened. :)

[buylowersellhigh]

Ross,

 

What is your thesis on CHEF?

 

TIA

 

Bought CHEF and QQQ puts.

 

I have a gtc buy order in for 17.5 on CHEF. Rinse and repeat on this one. The $23 month out options were going for $1.3 in March. I couldn't resist...

[Ross812]

Ross,

 

What is your thesis on CHEF?

 

TIA

 

Bought CHEF and QQQ puts.

 

I have a gtc buy order in for 17.5 on CHEF. Rinse and repeat on this one. The $23 month out options were going for $1.3 in March. I couldn't resist...

 

http://www.cornerofberkshireandfairfax.ca/forum/investment-ideas/chef-the-chefs'-warehouse/

 

There is quite a bit in there. I'm pretty comfortable with food distribution and I think CHEF is in an great niche market. I'm not as excited with their center of plate purchases (i.e. beef - too cyclical), but we are definitely on an upswing of cycle right now. They should make money on the next down swing.

[Lance]

Bought FFXDF (Fairfax India Hldgs Corp), closed my LNKD short.

 

Thanks,

Lance

[DavidVY]

Bought a few more things

 

-Houston Wire and Cable (HWCC) : Distribution company of wire and cable. Good track record so far. Energy crisis has sent all these distribution companies down. 1/3 of its clientele is energy related, but realistically only upstream is going to be affected. Midstream and downstream are probably passing on lower energy costs to consumer and demand is staying relatively the same (or higher)

 

-Amdocs (DOX) - Customer Experience Software. Stable company, high cash flows, zero debt. Handles accounting and billing for most major telcos worldwide. Niche segment w/low margin but high volume <--- Entry to barrier. Highly technical company (minus) but excellent capital allocators and growing slowly into new spaces

[Travis Wiedower]

OUTR and LGIH

[Guest notorious546]

OPY

[AtlCDore]

Bought FFXDF (Fairfax India Hldgs Corp), closed my LNKD short.

 

Thanks,

Lance

 

Lance,

 

Did that just get listed?  Why didn't you buy FIH (in Canada)?

 

Thanks,

 

AtlCDore

[Jurgis]

Bought FFXDF (Fairfax India Hldgs Corp), closed my LNKD short.

 

Thanks,

Lance

 

Lance,

 

Did that just get listed?  Why didn't you buy FIH (in Canada)?

 

Thanks,

 

AtlCDore

 

One reason to buy FFXDF is if your broker does not allow international stocks. Or if your broker does not allow international stocks in IRA and you want the position in IRA.

[TorontoRaptorsFan]

CTRL - Control 4

[DavidVY]

Bought Genworth today (GNW)

 

-Selling at 35% book value

- PMI insurance has stabilized

- Life insurance is in the mix too.

 

I think fair value is in the 60-75% BV range

[PatientCheetah]

CTRL - Control 4

 

what's your thesis on it? i owned it before, sold it at a loss.

[TorontoRaptorsFan]

Home Automation is a growing sector

Seems undervalued considering the interest PE firms have in the sector (ie-KKR investment in Savant & Sonos)

Growing dealer base to sell the product

Apps that work on both Android and Apple platforms

Been in business now for over 12 years

Could migrate platform to a cloud based model that would help with recurring monthly revenue from users (ie-similar to security contracts but to monitor every aspect of home - pool, spa, lights, audio-video, security, HVAC, cameras)

 

 

[Valuebo]

AIQ. Market keeps ignoring this one. Superlow daily volume driving the stock lower again.