Some links

Interesting feature on Japan’s richest man Tadashi Yanai, founder of Uniqlo

Highly recommended: Superb write-up from smallcapseurope on Greek company Flexopack

UndervaluedShares thinks UK publisher Pearson is worth following

The Profit Hunting blog with an update of its dividend portfolio

Valuesque has a very useful primer on how to value stock option plans

Another “must read” from Ben Evans: On the future of retail and E-commerce (Spoiler: Nobody knows anything)

Despite his performance issues, David Einhorn’s Q3 letter is worth reading


  • Synnex is a classic Greenblatt spin-off, scheduled for early December. It trades on 10-11 P/E, and whilst Remainco’s peers trade at this multiple, Spinco’s trade at much higher multiples, with each business generating similar level of profits. These are distinct businesses, each with strong market positions, long-tenured management teams and conservative post-spin leverage. Remainco is the second largest IT products master distributor, behind Tech Data, which was recently bought out by Apollo at around 11x p/e multiple after they topped a bid by Buffett. It is low margin but generates ~20% ROCE and has always been profitable. Spinco is the number 2 player in the ‘customer experience’ BPO segment (historically mainly call centres but now with digital ‘omnichannel’ services overlaid, with growth tailwind from increasing digitisation). It is higher margin and more capital intensive, but generates 50% ROCE. Teleperformance is the number 1 player and trades at 33x.

  • Einhorn’s letter is worth a read – as always.
    He is the first one I heard referring to AMS AG as a Swiss company.
    It is listed in Switzerland but the company is very Austrian – Austrian origins, Austrian HQ.

    • From the US, Switzerland, Austria, little difference. If I have an excuse to pretend a company is Swiss, I will claim it is. Just sells better to your clients. Like Turkey and Spain, both low-quality democracies, ultra corrupt regimes. Easy that people mixes them.

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