Tuesday, July 30, 2013

Battle Over Genesis Land's Board

If you follow Genesis Land (GDC), your head may be spinning by now. It's almost every day now that the current board and the activists trying to take it over are claiming some sort of injustice permeated by the other side. (To watch this battle in real-time, sign up for filing notifications for GDC here.) But surely, behind all the "Our directors are superior to yours" puffery, there are some differences in how each group would run the company differently.

To get to the bottom of this question, I had a conversation with Stephen Griggs, the CEO of Smoothwater Capital, the firm looking to upend GDC's current board:

Monday, July 29, 2013

Alco Stores Gets Bought Out

In the last two years and change, Alco Stores has been brought up on this site five separate times. Each time, the large discount at which the company traded relative to its net current assets was brought up. Last week, the price of the company's shares soared 60% as the company received a friendly buyout offer.

Friday, July 26, 2013

Beating The Street by Peter Lynch

Famed investor Peter Lynch took the Magellan Fund from $18 million in 1977 (when he took charge) to $18 billion when he resigned in 1990, posting a 29% average annual return in the process. The way Lynch achieved those returns is discussed in his book, Beating The Street.

Thursday, July 25, 2013

Great Canadian Gaming: Wide Moat, Cheap Price

Warren Buffett has made much of his fortune by investing in companies with wide moats in periods during which they traded at reasonable prices. Unfortunately, the run-up in the prices of US stocks has made finding such companies at reasonable prices exceedingly difficult at the present time. The Canadian market, however, currently hovers not too far from its 2009 highs, and remains well below its highs from 2011. As a result, the long-term investor is likely to find more bargains meeting the wide-moat/reasonable-price criteria. Casino operator Great Canadian Gaming (GC) appears to be a terrific example. Read more...

Friday, July 19, 2013

PineTree Capital's Debt In Free Fall, Now Cheap

Canadian investment firm Pinetree Capital (PNPFF.PK) has been a destroyer of capital over the last few years. Consider the following chart depicting the company's Net Asset Value (NAV) over the last decade: Read more...

Thursday, July 18, 2013

Aastra Management Does It Again

I raved about Aastra's management in an article I wrote about two years ago in which I highlighted the stock. Since then, the company's primary market (Europe) has only gotten weaker. But shareholders have done extremely well, amassing gains of over 75%. How is this possible? A good chunk of the credit has to go to management.

Wednesday, July 17, 2013

Strategic Logic

Strategic Logic is one of the best books I've read in a long time. I'd compare it to Greenwald's Competition Demystified in terms of both subject matter and quality. I would say it is extremely useful for two specific groups: value investors and entrepreneurs.

Tuesday, July 16, 2013

IGOI'ng To Where The Puck Is Going To Be

Just three months ago, the stenchy shares of iGo were brought up on this site as a potential value investment. Today, those shares smell almost 40% better, even though the company's operations have only gotten worse.

Thursday, July 11, 2013


I believe the sports media to be as misguided as the financial media. They both tend to ignore the role of luck/chance in outcomes, attributing causes and effects in wonky and often contradictory ways. But as you can find a lot of smart guys in finance who understand the challenges of separating out the skill from the luck, so you can find smart writers about sports who are doing the same. To that end, I became interested in reading Mathletics, which purports to explore counter-intuitive insights into the world of sports.

Wednesday, July 10, 2013

Commercially Trusting in PMC's Assets

PMC Commercial Trust was first brought up on this site in 2010, and then again in 2012. The company routinely traded at a discount of 30%+ to its net asset value, giving deep value investors the opportunity to buy a company that paid a high single-digit yield, and to do so while protecting one's principal.

Monday, July 8, 2013

The Shipping Man

Value investor Monish Pabrai recommends The Shipping Man, for those looking to learn about the shipping industry. It's a novel, unlike the vast majority of the books profiled on this site, about a hedge fund manager who knows nothing about shipping, but learns the ropes through both counsel and by experience. This setup frequently reminded me of The Goal, an operations management novel which I highly recommend.

Friday, July 5, 2013

Karsan Value Funds: 2013 Q2 Results

Karsan Value Funds (KVF) is a value-oriented fund, as described here. Due to securities regulations, the fund is not open to the public at this time. Should that change in the future, there will be an announcement on this site

Wednesday, July 3, 2013

The Great Rebalancing

The symptoms of the Great Recession are by now well-understood. Housing markets rocketed to obscene levels; loans were made to borrowers who could not repay. But conditions surely existed for such events to occur prior to the past decade, so why didn't they? In The Great Rebalancing, Michael Pettis attributes the cause of the recession to an oft-ignored meme: international trade imbalances.