Friday, June 27, 2014

Made To Stick

So you have this great idea, that you know is going to make more money for you and your firm. But how will you convince your boss, his boss and your peers that it's the right approach? Your contrarian ideas tend to hold no water among regular people, who are happy with the status quo and don't want to take risks. Meanwhile, Fred in the office next door is able to push all his initiatives through. Why is that?

Tuesday, June 24, 2014

A Short History Of Nearly Everything

Do you have any idea how we know what we know about the universe? We all "know" the earth is round, and that we are closely related to apes, but where did all this knowledge come from? In A Short History of Nearly Everything, Bill Bryson describes how all of our knowledge came to be.

Tuesday, June 17, 2014

Alloy Steel: Plenty of Reason for Being Cheap, but not This Cheap

A stock I bought recently is Alloy Steel (AYSI). I can understand why it would turn off a lot of investors, but that may be why it's so ridiculously cheap.

Monday, June 16, 2014

Dacha Strategic Metals: An Exit For Some, An Arbitrage Opportunity For Others

Dacha Strategic Metals (DSM) was discussed here as a potential value opportunity just 3.5 months ago. While the company had been a destroyer of capital for several years, it came under new management with a history of good capital allocation. I'm pleased to report that shareholders have seen a share price increase of 30% since that article. Annualized, that return comes out to a cartoon-y 150%.Read more...

Wednesday, June 11, 2014

Understanding Michael Porter

Michael Porter is one of the legends of corporate strategy. Most of you are likely familiar with the Five Forces model which has his name associated with it, but he didn't stop there even though that's as far as most people go with respect to Porter. In her book Understanding Michael Porter, Joan Magretta has full access to him, including his papers, transcripts of his speeches, and interviews with Porter himself. She summarizes Porter's thoughts on strategy and competition.

Friday, June 6, 2014

List of Cannibals

Charlie Munger strongly recommends that investors "look at the cannibals", defined as companies that gobble up their own shares. I have found it difficult to find an up-to-date list of cannibals, so I decided to create one. I've picked it over (though of course, it is always changing) and so I've now decided to share it publicly going forward, here.

Thursday, June 5, 2014

Wednesday, June 4, 2014

Orange Been Squeezed

About a year ago, Orange (ORAN) was brought up on this site as a potential value investment. (Back then, we knew it as France Telecom (FTE).) Sentiment was in the toilet. A weak European economy combined with new regulations and an upstart competitor scared investors away, resulting in price to free cash flow ratios in the single digits.

Sunday, June 1, 2014

IBI Group: Now That's More Like It

Two weeks ago, I was rather dismayed. I had received what I considered to be a very poor offer from IBI Group (OTCPK:IBIBF) to revise the terms of its debentures that I hold. Because these debentures are widely held by a number of retail investors, it seemed to me that management was trying to take advantage of a group without a lot of sophistication and market power. I'm pleased to report that their gambit failed!Read more...

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