I hope everyone had a great Thanksgiving weekend. Other than eating great food and spending time with family I also got a lot of work done. I spent a lot of this weekend looking into Wendy’s as a possible investment and my article about them should be up later this week. I also spent a lot of time catching up on articles that I have been saving to read, some of which I will be sharing with you below.
With all the research I have been going lately I have gotten way behind on posting links so here are a bunch that I think are very good.
The new company I was researhing turned out to be another bust after valuation. I found the Australian company to be in a range from fairly valued at the high end of my intrinsic value estimate to overvalued by as much as 70% from my low estimates of value and have decided to not do any further research on it at this time, especially since its margins were not very good either.
For now I am going to be reading some books over the coming days and then its back to searching for more companies to research.
Seth Klarman On Leadership. This video is from ValuePrax and contains some very valuable insights from the reclusive Klarman.
Charlie Munger Lecture at the Harvard-Westlake School. This interview is from Santangel’s Review and contains Mungers thoughts on the recent financial crisis.
Alice Schroeder On How Buffett Values a Business and Invests. This is yet another article from Greg Speicher that contain Ms. Schroeder’s thoughts on how Warren Buffett looks at business.
Valuation: Valuing Growth and the Petersburg Paradox. This is from Csinvesting and the page also has some links to papers that talk about different things valuation related.
I Learned To Speak Four Languages In a Few Years: Here’s how. This is a write up from LifeHacker about the techniques that helped the author learn four languages in a relatively short amount of time. This is fascinating to me because I have always wanted to learn a new language and have recently started learning a bit of Spanish.
Today I am going to value the company I have been researching to see if it warrants further research and a full article, I will update you about what I figure out.
I also sold out of my entire position in Vodafone (VOD). My valuations and brief analysis can be found in this post from last month.
I bought Vodafone before doing valuations of any kind and only minor research and again I paid the price. I bought at too high of a price in my estimate and it would have been very difficult to make money due to my high cost basis. In the link above I also give some other reasons why I was thinking about selling, which are ultimately why I decided to sell my entire portion of the company. I sold my stake in Vodafone up about 2% after commissions.
That brings the cash position in my portfolio up to 17% and for now I am going to hold onto it and will let you know when I redeploy some of the cash I have built up.
To the links.
Two links from Old School Value; the first one is How The Cash Conversion Cycle Can Help You Pick Winners and Losers. The second gives you 52 Techniques to Spot Fraud. Both contain extremely important lessons.
How Reading Lights Up Your Mind is from Psych Central about the effects reading has on your brain, very fascinating.
Charlie Munger on Google’s Moat-It’s Huge…Probably Widest He’s Ever Seen is another great post from Greg Speicher’s blog.
Greenbackd on Hunting Endangered Species. The link contains his 15 page strategy paper on “Hunting Endangered Species: Investing in the Market for Corporate Control.” The link also contains links to some of his other papers.
Some weekend reading links while I am searching for another company to evaluate.
Walter Schloss’ 16 Golden Rules For Making Money In The Stock Market. Link is from the Business Insider.
Tom Gayner’s Approach To Valuing Berkshire Hathaway. This article is yet another from Greg Speicher’s blog and the rules that are laid out could be used to value other conglomerates.
Leon Cooperman: These are the Traits That Make The Best Analysts On Wall Street. This article is from the Business Insider. See how many of the traits 14 traits you have.
DoubleLine Capital Valuation Hint from the Brooklyn Investor’s blog. This article, and the corresponding link at the top of the page to his previous discussion on DoubleLine, talks about things to look for when valuing financial companies.
How To Obtain An Edge When Investing, With Brad Hathaway of Far View Capital. Link is from GreatInvestors.TV
Now that I am done with the overview of my portfolio I can get back to the business of researching companies. Up first though are some links that I think can help us all learn.
Free download of an interview with Howard Marks from Oaktree Capital.
Laura Templeton on How to Retain Conviction When The Market Goes Against You. This is a three minute video with some very good insights for value investors.
Intrinsic Value: A Range, Not a Precise Figure is a great write up from Greg Speicher’s blog on the dangers of trying to pin down a companies exact valuation.
Seth Klarman’s Investment Framework is something every self respecting value investor should probably read.
Value Investing Challenge links to download the three finalists analysis and valuation articles. The detail in the articles and how clearly two of them put forth their analysis is absolutely amazing and something I hope to learn from. Possibly a few companies to do further research on as well.
Helmerich & Payne Analysis is a fantastic valuation and analysis article from Vitaliy Katsenelson at Contrarian Edge. Again, pay attention to the amount of detail, how he thinks, and his process, absolutely amazing.
Now that I have finished up doing my portfolio overview I am going to dive right back into researching companies. I will update you when I find something interesting, and I already have a few companies in mind to research.
How to Train Your Mind to Remember Anything is an article by Joshua Foer, the author of Moonwalking With Einstein: The Art and Science of Remembering Everything where he talks about some of the tips in his book.
Why Your Already Good Enough is an article from Pick The Brain on why you do not have to wait until some time in the future to achieve your goals, and how you are probably good enough to achieve them now.
Taleb: The Fooled By Randomness Effect and the Internet Diet? is another article from Farnam Street that has Mr. Taleb’s thoughts on information overload, overconfidence, and how they are effecting the modern world.
5 Simple Tips to Boost Confidence is another article from Pick The Brain.
A Blueprint for Being a Lousy Investor is a fantastic write up by Greg Speicher using Charlie Munger’s principle of inversion to look at the problem of how to become a better investor.
I have finished reading the most recent annual and quarterly for one of the companies I found to research. I just need to finish up reading this years proxy before I value the company but up to this point the company looks promising. If I find the company to be undervalued I will continue to do research and will plan to write an entire article on the company.
I will continue to update you on my progress, and in the coming days I will continue to post links that I think hold some kind of value.