Must read: Deep thoughts on changing competitive advantages from Jan (TGV Truffle fund)
Competitive Advantages 2: How ARM did beat almighty Intel
Steve Balmers “Truth”: How Microsoft missed mobile
The guy from Punch Card Blog look into one of heir failed investments (CONN)
Chipotle and the next big thing: Burgers. Plus a look behind the Chipotle counter.
Stock picking is not dead, closet indexing most likely will be soon
This is something that ran over the ticker today with regard to the Kuka case:
CFIUS Likely to Challenge Midea-Kuka Deal, Height Says
By Kasia Klimasinska
(Bloomberg) — CFIUS will likely challenge this deal “because Kuka has a direct relationship as a primary robotics supplier to Northrop Grumman,” Height analyst Nils Tracy says.
- “At a minimum, we expect the transaction will face an extended CFIUS review timeline and a number of divestures”
Wertart has a very good writeup on UK retailer SportsDirect
Punchcard likes used goods retailer Winmark
Forager likes Italian company El.En (I didn’t like El.En 5 years ago)
A few critical observations on Elon Musk and his “Master Plan II”
Some deep thoughts about the “Brexit Blues”
A very interesting reading list (investing & other)
A few weeks ago, Kuka, the Robotics specialist and one of the typical German “Mittelstand” hidden champions came suddenly into the spotlight.
Chinese company Midea Group (listed, ~20 bn USD market cap) made a 115 EUR per share offer. Midea already owned a stake before but now wanted to have more.
Recommended: TGV Partners Fund 6 month report: “Don’t be a dividend monkey”
Recommended: RV Capital 6 month report: “Is it possible to be long-term and contrarian?”
Congratulations. John Hempton (Bronte) got a full Bloomberg profile
Matt Levine on the FTC ruling for Herbalife
Buying a diet shake from a Herbalife distributor will now be harder than buying a gun;
Why Active Asset Managers need to change their business model
A good checklist from Forager if an Acquisition makes sense (or not)
The current state of the Bordeaux WIne market (FT.com, search result)
Waddell & Reed is a Kansas based Asset Manager (mostly listed equity) & Financial Advisory firm. The company became somehow infamous during the 2010 “flash crash” when they were initially blamed that one of their order had caused the crash. Later, the SEC blamed a guy in London for it.
W&R looks like an interesting “High quality mean reversion” type of value stock.:
Market Cap: 1,4 bn
P/E (2015): 6,9
Div. Yield: 10,3%
10 year avg. ROE: 33,4%
10 Year avg. NI margin: 14,1%
So we have a high ROE/ROCE, high margin business with significant net cash that trades at a ridiculously cheap level (based on 2015 earnings). There is a relatively recent SeekingAlpha “long” pitch with the following summary:
Performance Q2 2016:
In the second quarter, the portfolio gained +0,6% against -3,5% for the Benchmark (25% EUR Stoxx 50, 25% EUR Stoxx small, 30% DAX, 20% MDAX). YTD the score is -1,4% for the portfolio against -9,5% for the Benchmark. On a rolling 1 year basis, its +1,0% for the portfolio and -8,4% for the bench.
Just for fun, here is the YTD/1 Year performance of some small funds that I follow and where I know the managers (I will track them in future reviews just to see how I am doing against the “Pros”, data from Bloomberg):
Partners Fund TGV: +1,71% / +7,20%
Profitlich/Schmidlin: -3,86% / -4,35%
Squad European Convictions -1,19% / +7,85%