#121 - Ramblings Sep2024
Last updated: Nov 1, 2024
Burry’s Strategy 1-pager
How Berkshire chooses stocks
TD on Reits
Turning Stocks
$5958.T
Sanyo Industries. Very very cheap (net-net), profitable, and returning money to shareholders.
Writeup by Altaycap, archived here.
Could be interesting if the price drops and the CAD/JPY keeps climbing.
$WED.V
This was shared by Toffcap back in May'24. Share price is the same today.
This is the thesis:
From their 2024 Investor Day:
And yes, I assure you; we fully understand the mechanisms and the value of a NCIB and a SIB. We too do the math frequently.
$OTL.OL
Odfjell Technology Ltd., a technology and engineering company, provides well, drilling operations, and engineering services in Norway, the United Kingdom, Malaysia, Europe, Asia, and internationally.
EV/EBITDA ~ 3.6x
EV/EBIT ~ 6x
FCF/EV ~ 14%
Growing revenues since 2022.
8.5% dividend yield.
The way the market treats $OTL surprises me. They are a purely service company with good visibility, a backlog of like 6x BV on contracts that extend past 2025.Ruggedly low valuation now at sub EV/EBIT 5x 2025, a year expected to have high activity in the sector…
For better or worse, Helene Odfjell owns 60% of the shares, poor liquidity which makes it difficult for larger players to buy in.
But the point remains, the company is too cheap, I think type 8x EBIT is approaching reasonable levels.
But maybe I’m completely out cycling?
$INT.ST
Intellego Technologies AB. Looks very cheap on paper but some negative noise on twitter:
$DHT-UN.TO
$KSPI
Posted by Askar Akhmedov, CFA on LinkedIn:
I would also like to add some information about the situation with ADR Kaspi.kz hashtag#KSPI hashtag#Kaspi.In brief:
Culper Research is an American company, whose employees have probably never even been to Kazakhstan. They do not really understand what Kaspi is in our everyday life.
Kaspi.kz is an incredibly powerful and profitable machine that does not need Russian money/clients/risks in principle.
The company as such has not changed after the report - only the price at which its shares are now sold has changed.
More details:
Without visiting Kazakhstan and not seeing how Kaspi services are integrated into our lives, Culper Research not only passes by the shares, but also decides to short their shares. Such stupidity is comparable only to buying GME or NFT shares - there, too, traders do not understand what they are getting into. Half of the shorts’ arguments about connections with the Russian Federation are shattered by the reality of Kazakhstan, which is a member of the EAEU and for which the Russian Federation is one of its largest trading partners. Of course, we will have goods and equipment from the Russian Federation. The other half began to dig under the shareholders of the company - both current and former. Quite a lot of yellow press and irrelevant arguments. But in general - even if one of the shareholders suddenly falls under sanctions, the “50%” rule works. And at the moment, no two shareholders own 50% of Kaspi - that is, it is necessary for all three main shareholders to be under sanctions, so that they are transferred to Kaspi.kz.
I have been analyzing banks for almost 10 years and divide them into several groups: “hard-working”, “appendages”, “small fry” and “shady”. Small fry are all small foreigners, “appendages” - usually these banks serve the main holdings, “shady” are those that can really fall under sanctions or previously issued bad loans (like Qazaq). And hard-working ones are those that rake in money with their main business so that they do not need to slack off with money laundering, sanctions or issuing bad loans. These are Home Credit, Kaspi, Halyk or Altyn. Kaspi has an ROE of 80%+ - why would they take unnecessary risks? For 5-10 billion tenge? Ridiculous!
Today I was asked “why don’t you set Stop-loss limits?” Here is the answer - because the company’s price can sag, but the business will not go down one bit worsened. This means that the company’s valuation is the same as it was yesterday. And we value Kaspi at $35-40 billion.
Disclosure: today we increased our position in Kaspi ADRs.
P.S.: this is not a call for transactions with financial instruments.
$PLX.PA
EUR$2.8B in market cap and $660M in net debt (thread):
so $3.5B EV
But:
I guess I should have started with what the business does. I don’t have any interest in this.
$HEPS
Source thread: link.
A thread from Ugur Seker:
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