An Update, New Translation Page, and Links

As you might have noticed at the top of the page is now a translation page where you can translate the entire blog into many different languages.  I found something similar to this a few days ago but could not get it to work on the blog so I enlisted the help of my brother and he got the translation page working, thanks a lot Kev.  This also means that the short-lived Mandarin Value Investing Journey is also not now needed and will be going away.  I am sure the 20 of you who visited the mostly untranslated site will miss it dearly :).

A quick update on where I am at with the process of my article series.  I have now finished up the first two articles of the series and as you know I had planned to write articles on one or two more companies and then do a conclusion article.  Two of the companies I was planning on writing articles on I have been asked not to by the person who recommended them to me because he is planning on writing articles about them.  I am still going to read those companies annual reports and other filings but will not be writing articles about them so this has turned into a three-part series covering the two companies I have already written articles about and the conclusion article where I decide which of them to buy.  I will hopefully have the whole series posted as soon as possible.

“Things do not happen–they are brought about by careful planning, diligence, application, and direction.”George Mecherle, Founder of State Farm Insurance.

Valueprax-This One Is Personal.

25iq.com-Charlie Munger On The Importance Of Worldly Wisdom And Consistently Not Being Stupid.

CP-Africa.com-Meet 31 Year Old Ashish Thakkar-Africa’s Youngest Billionaire.

OTC Adventures-International Wire Group Is Cheap, But Is It Safe (ITWG)

Valuewalk-Baupost Group’s Seth Klarman Sees “50 Shades Of Value” In The Market.

Valueinvestingblog.net-CASA Holdings and Fiamma Holdings.

CSinvesting-A Reader’s Question On Case Studies.

Santangel’s Review-Benjamin Graham On Staying Small.

Motley Fool-Charlie Munger Info From A Board Poster.

Valueprax-Notes-Nintendo Back In The Saddle?

CSInvesting-Valuation Case Study HVAC.

OTC Adventures-Value Investing Strategy and Unlisted Securities Part 2.

CSInvesting-ValueUncovered Philosophy; Treat Everything As A Case Study.

Wexboy-2013: The Great Irish Share Valuation Project Part 2.

Credit Bubble Stocks-Horizon Kinetics, Owner Operators, and the Predictability Arb.

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Catching Up On Links

I have just finished up my newest article and just need to edit and proofread a bit more and hope to have it up soon.  Over the next few days I will be posting a bunch of links since I have gotten way behind on this while researching other companies, hope you enjoy.

Yahoo-Business Insider-The Story of a Man Who Outsourced His Work To China So He Could Watch Cat Videos All Day.

Forbes-The Great Baupost Madoff Claim Trade That Made a Big Madoff Feeder Fund a Loser Again.

Oddball Stocks-More is Better? How Much Information is Really Needed To Invest?

Four Hour Work Week-How to Travel Through 20+ Countries With Free Room and Board.  Cannot vouch for this yet as I have not tried it and it seems a bit sketchy to me but if it really works and is safe that is a potentially great idea for travelers.

Wexboy-Where Is the Credit Opportunity in 2013?

Shadow Stock-Illiquid Stocks For Outsized Returns.

Old School Value-The Harder You Work The Luckier You Get.

Rodkelly.com-30+ Quotes From Charlie Munger.

Outward Branch-Heart To Heart With Value Investor Theodor Tonca.

Business Insider-China Hard Landing Presentation. What If China Land’s Hard?

Weekend Reading Links

Oddball Stocks-What’s Your Real Business? The National Stockyard Story.

Geoff Gannon Guru Focus-Always Use Normal Numbers.

Shares and Stock Markets-How To Value A Business Like A Professional Money Manager.

The Aleph Blog-If You Want To Be Well Off In Life.

The Meta Picture-Learn To Read Korean In 15 Minutes.

Geoff Gannon Guru Focus-What Is The Best Way To Learn Accounting?

Oddball Stocks-Investing Like A Lender.

Graham And Doddsville-The Value Investing Gene-Buffett, Klarman, and Evolution.

The Guru Investing-Small, Illiquid, and Cheap: A Winning Combo.

Greenbackd-Quantative Value: A Practitioner’s Guide To Automating Intelligent Investment and Eliminating Behavioral Errors.  Have not read the book yet but plan to.

Micro Cap Club-Alter NRG Corp: Disposition Case Study With Ending Unknown.

Businessweek-Ryan Morris, 28-year-old Activist Investor.

Gannon And Hoang On Investing-My Investment Process.

OTC Adventures-Calloway’s Nursery $CLWY.

Aswath Damodaran Musings On Markets-Acquisition Accounting II: Goodwill, More Plug Than Asset.

 

Weekend Reading Links

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.

Atul Gawande: Excellence Is Recognizing Details, Failures

The Price Of Paying Attention

How Not To Run A Hedge Fund: Geoff Grant Edition

Advice From Jeff Bezos

How Did R.A. Dickey Master The Knuckleball

Jason Zweig Interviews Seth Klarman

How Did I Come Up With My 16 JNets

What Drives Operating Metrics?

Free Ebook: 115 Profitable Investing Ideas

How Buffett Made Money In Bad and Volatile Markets

Weekend Reading Links: Klarman, Munger, Buffett, Valuation, and Learning

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.

Howard Marks Interview, Laura Templeton, Intrinsic Value, Seth Klarman’s Investment Framework, Vitaliy Katsenelson, and the Value Investing Challenge

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.

Some weekend reading, and an update on my Altria write up

I thought everyone would enjoy these three articles to read over the weekend.

Warren Buffet’s Winning Ways 50 Years On.

Klarman Vs Tilson

This is The Trait That Makes Seth Klarman One of The Greats of Hedge Fund Management

I have finished my Altria write-up this morning and I now just need to edit it before posting it by the latest Monday morning.  Originally I wanted it to be just a mini write-up on my thoughts then vs now, but it turned into a full-fledged article which is why it has taken so long.  I hope it is something that you enjoy and can learn from.

Intel’s and my Vision for Education, Profile of Seth Klarman, and Dole news

Intel’s Vision of the future classroom

This is an amazing 3 minute video of Intel’s vision of the future classroom.

Education is one of my few other passions outside of investing.  I have always been a person who loves to learn, but find that our current educational system, from kindergarten to college is extremely antiquated and needs to be massively updated. When I make enough money I going to devote a lot of it to the upcoming education revolution and am going to open up my own school teaching investing, how to manage money, history, science, etc from a young age.

Profile of Seth Klarman

Here is profile of Mr. Klarman that has some interesting tid bits in it.

Dole news

This is mainly an article talking about the potential spin-off again, but this is some new news from the article.

“Combining the packaged foods division with Dole’s Asia operations into a stand-alone entity could be done with an Asia-based company, DeLorenzo said. Another option would be to initiate a joint venture with third parties through an initial public offering.

“We have generated a lot of interest in Asia,” DeLorenzo said. “It is a high growth area for all our businesses. It is more stable than North America and Europe, possibly because it is more demand driven. …. It would make sense in many ways. About 90% of our packaged foods assets are in Asia and many of the products for them are sourced out of Asia.”

 

Here is some more good news from Dole, this time insider buying from Mr. Murdock who already owns around 58%% of the company and is the Chairman and CEO.

Again, too bad I did not have any available cash in my personal investment account to buy Dole as it is now up almost 30% since I bought it in some accounts I manage, ugh.

Treasure Trove of free books

I mention csinvesting.wordpress.com quite a bit on this site and for good reason.  Not only does it have amazing analysis and teaches you how to think better about companies and investments.  He offers through his free Value Vault, books, videos, lectures, articles, etc from some of the greatest investors in the world.

Today John put up on his site 32 books/writings on his site that got donated to him from an anonymous contributor, all of which can be downloaded for free.

Some of the included books and writings are investment classics such as The Intelligent Investor, Security Analysis: 1940 edition, and Margin of Safety.

The books are in the categories of: Business Strategy, Investment and analysis, Valuation, Accounting, and Economic history.

Thank you so much John and the anonymous contributor, I am now going to have to upgrade my Dropbox account here very soon.

Here are the links.

Part 1

Part 2

Part 3

Part 4

Vivendi to sell Activision? Description of other subsidiaries.

http://www.ign.com/articles/2012/06/08/vivendi-to-sell-activision

A little bit of nice timing here coming off my post yesterday.  Anyways I have been hearing these rumors for a month or so now and am just waiting for their meeting on June 22nd to see what they have decided or not decided to do.

Activision Blizzard (ATVI) description- Worlds biggest video game company, and in my opinion has the best overall portfolio of games in the entire industry.  Call of Duty, Skylanders, Diablo, Starcraft, World of Warcraft, among others are included in the portfolio. This is the asset that I think would make the most sense to sell or spin off.

Call of Duty produces over $1 billion of revenues by itself with every game they produce, which comes out once a year usually in November.

However most of these franchises have either just come out with games or are past their prime in my opinion. World of Warcraft while still a cash cow is gushing subscription members every month, and Blizzard has already started to move resources into their next MMORPG which has no release date. Diablo III just came out so won’t expect another game in that series for a while. Call of Duty while still producing huge revenues and profits is at its peak to me and can only go down from here. The development studio who makes the Call of Duty series has been fighting with and losing a lot of team members over the last several years which will also hurt quality in the future.

I also see the entire console video game industry in a decline as well.  You can only keep asking people to pay more for less, for so long before they decide to stop buying games and consoles, especially with cheaper games coming out either free to play or for under $10 on tablets and phones.

The next generation of gaming systems is going to start coming out later in 2012 which is also another reason they should sell before that happens due to the higher costs and lower profitability that comes from every new console generation.

In my opinion now would be the perfect time to sell ATVI, will likely never be able to get a higher price than they would now due to the above. The only problem would be finding someone big enough to buy them.

GVT description-Fixed phone and internet Brazilian telecom who Vivendi recently bought.  Has great growth potential but will cost a lot in the short term due to high amounts of cap ex in the telecom industry. Should be one of the better Vivendi holdings over the long term though as their margins are good.  My main concern with this one is that Vivendi over payed for it so it will take longer to recoup that investment, and being in Brazil you never know what company might be expropriated by  the goverments in South America.

Maroc Telecom description-Mobile/internet/fixed phone company with most of their business in Morocco.  Same problem with cap ex as GVT above especially since they are going to be transitioning into 3G coverage from 2G, also could eventually pay off due to more data plan subscriptions from the smartphones that run 3G.  Maroc has also been having problems with the government in Morocco as they have been having to cut rates thus losing out on revenues and lowering margins.

Canal+ description- Pay TV/cinema company with operations mainly in France. Another asset I could see them spinning off or selling. Owns 80% of Canal+ France which they have been trying to buy out completely to no avail which could lead them to sell their portion of it. Does own the rights to show Ligue 1 soccer matches and UEFA Champions League matches in France which is a major advantage.

Universal Music Group description-Biggest owner of music and music publishing rights in the world. Produces the lowest EBITDA and CFFO margin of the entire group.  Also doesn’t seem to fit the profile of the rest of the subsidiaries which might lead this to being sold.  However owns the rights to music from the likes of: Rihanna, Lady Gaga, Justin Bieber, Eminem, Taylor Swift and various other major music artists.  The music industry could also see a comeback to higher profitability with things like ITunes, Pandora, and Spotify though if they can figure out how to monetize their publishing rights properly.

SFR description- Mobile/fixed phone/internet company with operations mostly in France. Vivendi’s biggest revenue generator currently and probably most important to the groups success in the future.  Currently facing some headwinds in France with having to cut rates which is lowering margins. They are facing new, tougher, and cheaper competition in their market which is also currently lowering margins and causing a loss of subscribers.  Also losing some business due to the difficulties of the European economy and the loss of discretionary income by some individuals.  Recently bought out the remaining 44% of SFR from Vodafone which in my opinion they overpaid for, but should pay off in the future. Will hopefully return to profitability in the near future.