tag:blogger.com,1999:blog-3541352681651202123.post5754630607367695030..comments2023-12-27T00:31:42.598-08:00Comments on the patient investor's blog: A Brief Thought Experiment (+ 3Q Results) Long Cast Advisershttp://www.blogger.com/profile/13731550239184386639noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-3541352681651202123.post-73199171884266934852017-11-29T14:55:19.586-08:002017-11-29T14:55:19.586-08:00Thanks for your comment. It makes sense to become ...Thanks for your comment. It makes sense to become part owner of a business as few times as possible.<br /><br />pheonixhttps://www.blogger.com/profile/16351836915454429430noreply@blogger.comtag:blogger.com,1999:blog-3541352681651202123.post-42216391333078517252017-11-27T11:43:19.937-08:002017-11-27T11:43:19.937-08:00Thanks for your comments.
It's not apparent ...Thanks for your comments. <br /><br />It's not apparent to me what problem RMG solves for its customers. Without understanding this I can't possibly can involved in becoming a part owner of the business. <br /><br />I'll add that becoming a part owner of a business solves the problem of capital deployment and I like to do this as few times as possible so that I can generate a return on that investment over as long a time as possible. <br /><br />Long Cast Advisershttps://www.blogger.com/profile/13731550239184386639noreply@blogger.comtag:blogger.com,1999:blog-3541352681651202123.post-90288444860870108742017-11-26T11:46:48.290-08:002017-11-26T11:46:48.290-08:00Adding one more example:
4. Rollup strategies whe...Adding one more example:<br /><br />4. Rollup strategies where company uses 10X+ EBITDA to acquire 5X+ EBITDA company. If they are successful in executing, they can keep doing it for long time.<br />Example: EVI<br /><br />pheonixhttps://www.blogger.com/profile/16351836915454429430noreply@blogger.comtag:blogger.com,1999:blog-3541352681651202123.post-86023970783047451242017-11-26T11:43:34.753-08:002017-11-26T11:43:34.753-08:00Good post. I like the theme of patient investors l...Good post. I like the theme of patient investors looking at improvements that don't screen well but indicate future profits. <br /><br />I tried to capture some examples of this theme below:<br /><br />1. As you suggested above- Companies increasing spend towards sales & marketing but that hasn't shown up in revenue and profits yet<br /><br />2. REITs that have cancelled dividend while they clean up their portofolio.<br />An example in this area is DS. Others that are in play but haven't shown improvements in dividend or AFFO (things that screen well) are RSO and STAR.<br /><br />3. Commodity companies that are lowest cost producer and are cutting costs, but these improvements haven't shown up yet in profits due to low commodity price. The returns are amazing once the tide turns and commodity prices pick up<br /><br /><br />The one exception I see for #1 above is RMGN which was a small position (<2%) for me but has lost ~67% on paper. They've shown promises of improved sales but the revenue hasn't gone up for 2+ years. Things might still work out, but trying to see if there are some takeaways from this example.pheonixhttps://www.blogger.com/profile/16351836915454429430noreply@blogger.com