The 1st one regards AB-InBev and the fact that it’s still hard for “foreigners” to fully grasp it. Yesterday’s LEX column on the company has flattering but less than enlightened comments and puts way too much weight on the P/E ratio. The 2nd one is about Netflix, and this NYT story sheds some (more) light on the company. It’s about creative destruction stimulated by the company itself. It doesn’t guarantee Netflix will win as the technology shifts continually challenge its business model, but it gives the company a fighting chance. Again, such a shifting business model is probably not the best playground for investors, but Netflix is still worth tracking for all the other reasons.
In a first of what we hope to be many article collections about investors we keep track of, this one is about Glenn Greenberg of Brave Warriors Capital. He’s better know as the co-founder of Chieftain Capital, but in the end of 2009 him and John Shapiro parted ways (Mr. Shapiro and two other partners left but retained the name Chieftain Capital). Being the first to be profiled in this series isn’t a matter of order of preference at all.
Zynga keeps popping up on the news as it reportedly heads for an IPO, and one piece asked if it can become the Google of online games. Sure, the business model seems fantastic – precisely what usually attracts competitors. So far they have suffered and didn’t really appear to threaten Zynga. Now Disney is making a move and it’s easy to imagine other players joining the battle. Plus, thinking about games reminded us of Electronic Arts.
We haven’t come to this classic by accident: the subject of inflation has been all over major magazines and newspapers recently. Warren Buffett pretty much defined the subject in his classic, 1977 article for Fortune Magazine called “How Inflation Swindles the Equity Investor”. It’s a must-read for any investor, preparation material for a number of finance programs around the world, and all-around common-sense knowledge that most people need.
Read more about Classic articles, vol. 3 – Inflation and equity prices
Spinoff & Reorg Profiles’ latest report has a very interesting section on Insider Buying, and we asked for and got Bill Mitchell’s permission to post an excerpt here. Using Sharps Compliance (ticker SMED) as an example, this section of the report discusses when “incentive stock option exercises may act as an insider signal”. Item #5 in his summary (the last paragraph) is vital, as insiders are only human and can get carried away with frothy valuations just like the rest of the market. No matter how powerful one or even a combination of “signals” may seem, there must be “fundamental value” / margin of safety.
Three WSJ articles related to consumers in emerging markets and how CG companies are adapting. The 1st one highlights the bullish comments on emerging markets in Nestlé’s Investor Day, with some detail on the capex plans and the goals they intend to achieve through these investments. The 2nd story is about India and the P&G vs. Unilever battles over there. Finally, a 3rd story (weaker) highlights 3 chinese companies supposedly exposed to China’s increasing “consumerism” – the stock analysis is superficial and the trend is far from “new news”, but it complements the other two articles.
In this Q1 2010 report, we describe how the last few months were a period of much study and few operations. We have found ourselves in a phase with few new situations in which we could have great convictions. We also announced the “Prêmio Investidor Profissional de Arte – PIPA” to our clients.
Nielsen (of TV ratings fame) is set to make a return to the equity markets merely 4 years after being taken private. The former VNU was one of our international holdings that were LBO’d in the final stages of the booming markets in 2006 and early 2007, along with others. These cycles make for interesting opportunities to reacquaint ourselves with companies we admire in businesses we like, and hopefully our efforts to understand these companies in the past will again pay off.
Brazilian newspaper Valor Econômico featured an article today on one of our global favorites: Thermo Fisher. It’s an opportunity to continue learning about a company that we’ve dealt with since 2006 and discussed in our Q3 2009 and Q4 2008 reports. It’s always great when a global analysis effort pays unexpected dividends.
Official immigration decreasing, previously “hot” areas with unprecedented swings, NY’s staggering numbers… Sure, a data point does not a trend make, but demographics are too powerful to ignore as a long-term driver. And it’s hard to argue that the US is well-positioned. This WSJ story has lots of interactive charts and features, and here’s the primary source.
