May 16th, 2008 @ 10:52 PM
It seems everyone is taking a break from following value investing news stories this week. The number of stories making it to the front page of Value Investing News this week was a bit lower than average.
Folks are probably recovering from all the Buffett news after the annual meeting. (Just thinking of that, I’ve updated the 2008 Ultimate Guide to the Berkshire Hathaway Annual Meeting with a few new blog posts.) Heck, the most popular story this week was a story on Buffett fatigue. Here’s the full list of top stories this week, including that article:
- Sick of Buffett Stories?
- Why I Bought (and Sold) Graham Corporation
- What do Buffett, Pabrai, and Jim Rogers Have in Common? They Look For the Obvious
- Leucadia Releases 13-f: Can You Spell Concentrated Portfolio?
- Garmin: Growth at a Reasonable Price?
- Lampert Reports Sallie Mae Stake
- 4 Interesting 13F Buys (Q1-08)
- Berkshire Hathaway Assurance Corp: A Royalty on Stability
- Fooling Some of the People all of the Time: A Review
- First Eagle Funds Conference Call Transcript
I’m considering moving the top stories of the week post from Friday’s to another day of the week. Any suggestions?
Filed under Financial News | Comment »
May 14th, 2008 @ 7:17 AM
The Special Situations Real Money Portfolio continued to struggle in April. On April 30, 2008, the portfolio ended with a balance of $13,957.69. This is down from the March closing balance of $14,362.01. Year-to-date, the portfolio is down 12.58%. However, the overall return is a positive 39.58%. On an annualized basis, the Special Situations Real Money Port had a 16.29% internal rate of return since inception (as of April 30, 2008).
The only transaction in April was the tendering of 80 shares of Sybase (SY) in this account. This was an odd lot tender offer where holders of less than 100 shares would be completely cashed out in a modified dutch auction with a price range of between $28.00 and $30.00 per share. The final tender price was $28 per share, so I received $2,240.00 in cash on April 17, 2008 for my shares. Since I bought the shares for a total cost of $2045.35 on March 17, 2008 and there was a $25 tender fee by my broker, I made a total profit of $169.65. This comes out to a 8.3% return, which means this deal produced a 97.7% average rate of return for this one month investment.
If you are interested in other opportunities like the Sybase tender offer, subscribe to Fat Pitch Financials Contributor’s Corner. Contributor’s Corner in a premium online community and database packed with special situation opportunities. You’ll also be able to review the complete current holdings of the Special Situations Real Money Portfolio and its full transaction history.
Finally, I’m happy to report that the Special Situations Real Money Portfolio has improved dramatically so far in May. As you may have noticed from the live portfolio performance reported in the sidebar, the portfolio is now only down 5.59% year-to-date and will likely move into positive territory again for the year when I receive cash for a going private transaction that recently completed. I’ll let you know at the end of the month how things turned out.
Disclosure: None of the stocks mentioned in this post are currently held.
Filed under Special Situations Real Money Portfolio | Comment »
May 13th, 2008 @ 2:57 PM
Today I added shares of art auction house Sotheby’s (BID) to the Fat Pitch Financials Portfolio. The shares were purchased earlier this morning for an average price of $24.55. As is typical with any new purchase, shares of Sotheby’s dropped further today to a low of $23.75. It always seems like a little pain is needed before gains can be had.
Regardless, I am very excited about this purchase. It is very rare to be able to pick up shares in monopolies or duopolies for such a low multiple. Even though there may be a bubble in the modern art market according to some reports that I’ve read, other art sectors haven’t seen as much appreciation. Even if the modern art bubble deflates, art collectors will continue to use art auctions in the future regardless of current art prices. The choice typically comes down to either Sotheby’s or Christie’s when selling major works of art. I like those type of odds. Basically, Sotheby’s is a toll both on the road to obtaining fine art.
I expect that Sotheby’s may get a bit cheaper if this housing led recession starts to impact the super wealthy. However, unless things get much much worse, it is unlikely that the wealthiest, with their multiple income streams, will be sufficiently impacted by the economy to curtail their purchases of fine art and collectibles. If I’m a bit too early, I still have sufficient cash reserves to buy additional shares at an even lower price.
Disclosure: I own shares of Sotheby’s.
Filed under FPF Value | Comment »
May 12th, 2008 @ 10:13 PM
The 88th edition of the Festival of Stocks is up at Stock Market Prognosticator. There were articles this week covering Ingersoll-Rand (IR), Investortools (SWIM), AeroGrow (AERO), Dover Corp (DOV), AIG, Melco PBL Entertainment (MPEL), Coca-Cola Company (KO), and Google (GOOG). I was impress by the number of companies covered in this week’s Festival of Stocks.
I hope next week’s edition brings in just as many articles analyzing stocks. Be sure to visit the Festival of Stocks homepage to learn how to submit entries for next week’s Festival.
Filed under Carnivals | Comment »
May 9th, 2008 @ 10:07 PM
Filed under Financial News | 1 Comment »
May 6th, 2008 @ 9:52 AM
The 87th edition of the Festival of Stocks is up at Finance ViewPoint. This edition brings a bit of an international flavor to the Festival of Stocks since it is written by an Australian.
Finance ViewPoint highlighted three editor’s picks: Allocate 50% to Non-U.S. Stocks, According to Wharton Professor, Let Volatility Be Your Friend, and Dividend Stock Wednesday: Hasbro (HAS-N). My Ultimate 2008 Berkshire Hathaway Annual Meeting Guide was also included in the Festival of Stocks. Be sure to check it out if you haven’t already.
As always, you can catch up on past editions by visiting the Festival of Stocks homepage. There you can also learn how to submit entries for consideration for next week’s Festival of Stocks and you can also find information on how to host a Festival of Stocks on your own blog.
Filed under Carnivals | 1 Comment »
May 3rd, 2008 @ 9:40 AM
If you couldn’t make the 2008 Berkshire Hathaway (BRKa) (BRKb) annual meeting to experience Warren Buffett and Charlie Munger first hand, then I hope that the following guide can again offer the next best thing to being there in person.
We can kick off this year’s meeting with the press release and the Q1 quarterly report for Berkshire Hathaway.
I also got word of a Berkshire Hathaway Annual Meeting after party at Nomad Lounge.
Official Releases
Premeeting Coverage
Blog Posts
Media Coverage
Photos
Videos
Please share links to your coverage of today’s events in the comments section below.
PS: Can someone pick me up a deck of the Berkshire ballsball like cards for charity that I heard about? I’ll pay for the cost and shipping.
Filed under Charlie Munger, Superinvestors, Warren Buffett | 2 Comments »
May 2nd, 2008 @ 8:20 PM
This is the time of year when value investors from all over the world gather in Omaha, Nebraska for the Berkshire Hathaway Annual Meeting. At Fat Pitch Financials, I’m already starting to develop the 2008 Ultimate Guide to the annual meeting. I will be updating Fat Pitch Financials all weekend with the latest stories coming out of Omaha just like I did for the 2007 Ultimate Berkshire Hathaway Annual Meeting Guide.
Please send me links to any contest being report from the annual meeting by either emailing me, posting them to Value Investing News, or Twittering me. If you use Twitter, I suggest that you subscribe to my account, FatPitch. I’ll be posting links about the Berkshire Hathaway meeting live as I find them this weekend. I wonder if anyone will be sending out tweets live during the meeting.
To get everyone in the mood for the upcoming Woodstock for capitalists, here are the top value investing news stories of the week:
- Underestimating Warren Buffett
- Francis Chou speech notes
- David Einhorn on WealthTrack
- Long View: Even the great investors get the right bets wrong
- Now Available: The Four Filters Invention of Warren Buffett and Charlie Munger
- Peter Bernstein - One Guy Who Has Seen It All Doesn’t Like What He Sees Now
- Magic Formula Business Sector #8: Software
- Warren Buffett Finances Mars-Wrigley Deal: The Complete CNBC Interview
- Mars, Buffett Team Up in Wrigley Bid
- Sampling Western Sizzlin’s Fare
Also be sure to read the 2008 First Quarterly Report for Berkshire Hathaway. It just came out a little while ago.
Before you leave, I just wanted to mention that we’ve done a bit of spring cleaning at Value Investing News. I hope you like the new look. Let us know if you have any suggestion or feedback on the new design.
Filed under Financial News | Comment »
May 1st, 2008 @ 11:37 PM
The Fat Pitch Financials Portfolio was down 1.21% in April. Considering that the S&P 500 was up 4.87% last month, this performance was rather disappointing. Looking back over the past 12 months, performance was was a bit better. The Fat Pitch Financials Port was up 0.36% versus a negative -4.93% for the S&P 500. Most importantly, the annualized rate of return since inception for this portfolio is 7.70%, which basically matches the 7.83%.
I recently received a question about the beta of the Fat Pitch Financials Portfolio. I don’t normally track the beta of my portfolio, so this was a rather interesting question. Thankfully, Marketocracy tracks the beta, alpha, and R-Squared for my portfolio. The beta was 0.50, which basically tells me that I have a very boring low volatility portfolio. Alpha is 4.66%, which I believe means that this portfolio beat the S&P 500 by 4.66% on a risk adjusted basis. Finally, the r-squared for the portfolio is 0.29, which means the portfolio does not closely track the index. From what I’ve just read, this low r-squared also indicates that I should put much weight on the beta number. I don’t normally look at these portfolio statistics. Do other value investors track these numbers?
As far as transaction, April was a quiet month. No trading occurred. However, there was quite of bit of news to read about my stock holdings. Microsoft (MSFT) drama with Yahoo (YHOO) has been interesting to follow. I not in favor of the bid for Yahoo, so the passing of the offer deadline is good news for me. However, my guess is that this story is not over yet.
Western Sizzlin also caught my attention a few times this month, but so far all the news has been bad. None of the deals (SNS and ITEX) have been completed. These transactions had a significant negative on earnings. However, I’d rather see Western maintaining disciple than seeing Sardar Biglari upping his bids.
Hopefully, May will bring some good news for my companies. In the meantime, I’ve got my eye on a few stocks and I continue to hunt for other value opportunities.
Filed under FPF Value | 1 Comment »
Apr 30th, 2008 @ 5:28 AM
I received the news that Bud Labitan has released his first book entitled The Four Filters: Invention of Warren Buffett and Charlie Munger. As you might recall, I provided a sneak preview of The Four Filters back in March. That excerpt provides a good overview of the book.
As significant as the refinement of the microscope by Antonie van Leeuwenhoek, Labitan believes that Warren Buffett and Charlie Munger invented an investing formula that is underappreciated by the business and academic communities. In his view, the Four Filters developed by Warren E. Buffett and Charles T. Munger is an amazing intellectual achievement in both practical and behavioral finance. He thinks it will have a major future impact in the way business, management, and behavioral finance thinkers shape new methods of combining qualitative and quantitative valuation. After all, the Four Filters are an important set of steps used by the world’s greatest investors. While Mr. Buffett does not endorse this book, he did give Dr. Labitan permission to use his quotes from the annual letters to shareholders. Labitan weaves the material into the story of successful “framing” and the “filtering out” suboptimal investment choices.
Bud’s book is available for order via the secure Google Checkout system at Bud’s website, www.frips.com. The Four Filters is being released in two formats, a spiral bound book for $39.95 and $29.95 for an audio cd generated from text to speech technology read at a rate of 150 words per minute. Bud was planning to publish with a major publisher and he had a contract offer. However, they had wanted to change the book and drop Charlie Munger and Four Filters from the title. This along with plans to expand and dilute the prose was too much for this first time author to bear. Therefore, Bud Labitan decided to self publish his book so that his work could be shared the way he intended, lean and valuable, the new standard in “intelligent investing.”
Filed under Book Reviews | 4 Comments »
