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Paradise, Inc. Is Liquidating! ($PARF)

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Seth Klarman: “Value Investing Is At Its Core The Marriage Of A Contrarian Streak And A Calculator.”

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  • Kahneman and Tversky also developed the idea of prospect theory , or how people make decisions when they are uncertain about gains and losses.
  • In investing, the reference point is what you paid for a stock.
  • When most people come to believe the same thing, large gaps open up between price and value.

Investors Must Continue To Challenge Their Long Held Beliefs

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  • During his recent interview with Tobias chats with Jim O’Shaughnessy, best selling author and Co-Chief Investment Officer at O’Shaughnessy Asset Management (OSAM) , discusses why investors must continue to challenge their long held beliefs.
  • Jim O’Shaughnessy: Right, you don’t get it.
  • Jim O’Shaughnessy: You don’t understand.

Update Cars.com & Kanam Grundinvest

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  • The company even made an acquisition for around 165 mn USD.
  • Besides the nonsense KPIs, the presentation clearly shows that sales are declining and cost is still increasing.
  • One of the main lessons from Cars.com is that I am not a very good spin-off investor .

May Dividend Income Report +36% dividend increase!

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  • However, each month I calculate how much I receive from my holdings; I always end-up with a higher number.
  • Finally, Capital Markets increased 17%, primarily due to higher revenue in Global Markets.
  • Exchange rate shifts hurt net revenue growth by ~1.5 percentage points and a new revenue accounting standard increased net revenue growth by 0.8 pp.

Idealist, I Am

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  • This headline is what piqued my interest in Ukrainian politics and Mr. Zelensky and motivated me to watch the series.
  • A president is not a portrait.
  • Idealist, I am.

Why Tech Is Likely to Withstand Antitrust Inquiries

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  • Mega cap technology companies are now facing heat as the federal government continues the process of investigating their market positions as it relates to antitrust/monopolistic issues.
  • So I decided to go back and see exactly how stifled Microsoft’s growth was after the government’s lawsuit was settled in 2001.
  • MSFT Fiscal 2001 EBITDA: $13.2 billion

Activism Story: Texas Pacific Land Trust ($TPL)

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  • But nowhere in the Declaration of Trust are trustees vested with the authority to wage proxy contests against shareholders, or in any way utilize trust property to impose on shareholders the nominee of the incumbent trustees.
  • Check out how many copies of their proxy card the incumbents sent - all with the Trust beneficiaries' money!The Eric Oliver dissident nominee is the Chairman of AMEN Properties which is a micro cap and kind of an Oddball.

Activism Story: Texas Pacific Land Trust ($TPL)

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Investors Should Beware When They Start To See ‘Information Cascades’

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Mohnish Pabrai – Investors Can Take Advantage When Markets Get Confused Between Risk And Uncertainty

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  • If you have a business which exhibits very high uncertainty then that business generally will get very extreme kind of valuations in a auction driven market and an investor can take advantage of it.
  • It priced it at $45 and from my perspective I said okay why don’t we just buy the stock and wait for two years and because I have all the plants, I have everything else.
  • Because you’re not giving any value to the plants and all of that, and some Swedish firm came and offered $160 for the business, and the stock immediately went for $153 or something.

Enbridge Line 3 – Another setback

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  • Although Enbridge is mostly a cash flow story, an investor is paying a lot in advance in order to realize those cash flows – in addition to the requisite risks to pay back the debt, interest and preferred share dividends.
  • Coupled with large future capital expenditures, if there is any sort of credit situation that may occur in the future, equity owners will be taking a lot more price risk than the current potential for reward – which wasn’t going to be a stock price that much higher than CAD$50/share.

Spirit MTA REIT: Sells MTA Assets to HPT, Remains Compelling

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  • Spirit MTA (SMTA) this morning announced the sale of the assets contained within the Master Trust to Hospitality Properties Trust (HPT) for ~$2.4B, after redeeming the Trust's debt and other transaction expenses will net SMTA approximately $450MM (I was hoping for more like $500MM, but this is a reasonable outcome).

Tesla's Travails: Curfew for a Corporate Teenager?

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  • Download ARK pricing from Github This is a pricing, not a valuation: I know that this will strike some as nitpicking but what ARK has produced is a forward pricing for Tesla, not a valuation.
  • The ARK bear is bullish: The ARK bear case requires that Tesla will sell 1.7 million cars in 2023, at an average price of $50,000/car and generate an operating margin of 6.1% on those revenues.

Is Value Investing Dead?

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  • Question: According to many market commentators, value investing doesn’t work the way it used to, and some tout statistics that growth has outperformed value over the last decade.
  • She can count to 100 in both English and Russian.Value investing to me is a philosophy that is governed by what I call the Six Commandments of Value Investing – all principles that come from the teachings of Ben Graham, spelled out in his book The Intelligent Investor and later popularized by Warren Buffett.

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