Friday, December 16, 2016

Holiday Gift Guide For Investors & Financial Professionals

Each year we highlight some relevant gift ideas for investors & financial professional besides the obvious (liquor).  Whether you need ideas for clients, partners, employees, or even for yourself, here's the 2016 guide:

Discounts on Publications

Wall Street Journal Discount - 50% off 12 months

Hedge Fund Wisdom - Our quarterly newsletter summarizing 13F filings

Recommended Books

  Margin of Safety - If you have someone to impress, get them a rare physical copy of Seth Klarman's book that has been out of print for many years

  So You Want To Start a Hedge Fund - Somewhat cheesy title, but in reality a good book & quick read with lessons on success and failure from major funds (see our review here) 

  Influence: The Psychology of Persuasion - Frequently recommended by Charlie Munger; Enough said 

  Quality Investing: Owning the Best Companies for the Long Term - Good read by Larry Cunningham 
  The Undoing Project - Michael Lewis's new book on the beginnings of behavioral finance 

  The Power of Habit: Why we do what we do in life and business

TV Shows / Movies / Documentaries

  Billions (Season 1) - The first major show about a hedge fund manager, starring Paul Giamatti and Damian Lewis.  Play catch up before Season 2 starts in 2017

  The Big Short - Movie adaptation of Michael Lewis's book of the same name; Starring Christian Bale, Ryan Gosling, Brad Pitt & Steve Carell

  Margin Call - One of the few good movies on Wall Street.  Features Kevin Spacey and Zachary Quinto, among others

  Jiro Dreams of Sushi - There's a lot of parallels to investing in this documentary (we wrote about it here) about one of the world's top sushi chefs and his dedication to perfecting his craft


  Amazon Echo - The famous 'Alexa' personal assistant

  Apple Macbook Pro Laptop - The newly released version with Touch Bar

  Apple Macbook Laptop - Ultra portable and lightweight laptop with retina display, perfect for travel

  24-inch or 27-inch IPS Computer Monitors by Acer - Get 2 or 3 for a great multi-screen setup for work or home office

  Sonos Wireless Speakers - Great for streaming music; put one in each room


  Wall St Bull Mini Statue - Pretend you're David Tepper and rub the bull's balls for good luck on trades

  Buy / Sell / Hold Dice - Nice office accessory; Roll the dice for your investment decisions

  Lehman Brothers Coffee Mug - Sip ironically
  Crystal Whiskey Decanter & Glasses - Class up an office Mad Men-style

  "Hedge fund" Piggy Bank - Gag gift

  Board Game: Catan - A strategic game where players acquire and trade natural resources to develop holdings

Happy Holidays!

Wednesday, December 14, 2016

10% Off Scuttleblurb For Our Readers: Summaries of Management Commentary

We've secured a discount for our readers to, a service that provides relevant and accurate summaries of management commentary from earnings calls and sell-side conferences, organized by industry.

Join dozens of value-oriented funds and family offices who use the site to efficiently ramp up on new industries and glean insight into themes and recent developments.

Scuttleblurb helps you deepen understanding, draw connections, and save time.  Instead of spending hours upon hours listening to conference calls, scuttleblurb aggregates the most relevant information in one place.

Get helpful context, including the author's bracketed commentary and embedded links, as well as regular email alerts on hundreds of blurbs per year.

Sample posts are available on the site.

Click here to save 10% off your first year subscription with coupon code: marketfolly

Monday, December 12, 2016

Sohn London Conference Notes 2016: Hohn, Bishop, Croxson & More

The Sohn London 2016 conference recently ended and featured hedge fund managers sharing investment ideas to benefit the treatment and cure of pediatric cancer and childhood diseases.  Please click the links below to go to each speaker's presentation.

Sohn London Conference Notes 2016

Chris Hohn (Children's Investment Fund): Long Charter (CHTR)

Robert Bishop (Impala Asset Management): Long Rio Tinto (LON:RIO)

Adrian Croxson (Och-Ziff Management): Long Ryanair (LON:RYAN) 

Masroor Siddiqui (Naya Capital): Short Aryzta (VTX:ARYN)

Erik Karlsson (Bodenholm Capital): 2 long ideas

Nicolas Walewski (Alken Asset Management): Long B&M Value Retail (LON:BME)

Elif Aktug (Pictet Asset Management): Long Leonardo

Anne-Sophie d'Andlau (CIAM): Long Euro Disney (EPA:EDL)

Ivan Martin Aranguez (Megallanes Value): Long Sonae (ELI:SON)

Marc Chatin (Parus Fund): Short Australian banks

Michel Massoud (Melquart): Long Opera Software (STO:OPERAO)

Dureka Carrasquillo (Canadian Pension Investment): Long Mobileye (MBLY)

Mans Larsson (Makuria Investment Management): 2 long ideas

Bo Bortemark (Carve Capital): Long Ferrovial (BME:FER)

Be sure to also check out notes from other recent investment conferences here.

Sir Chris Hohn Long Charter Communications: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Sir Christopher Hohn of Children's Investment Fund (TCI) who pitched a long of Charter Communications (CHTR).

Sir Chris Hohn's Sohn London Conference Presentation

TCI have already been invested in Charter for 3 years, but Hohn sees it as a multi-year investment. Charter is a public leveraged buyout which makes it an interesting special situation. It bought Time Warner Cable, a much bigger company, using a large amount of debt. Charter can compound at about 25% per year.

Cable companies are interesting because they should no longer be labelled as television businesses but as broadband businesses. Broadband businesses are a toll road on the internet.

Four reasons to like the business:

-    Telephone companies are not competitors to broadband providers

-    Digitization and cloud technology will change the capital expenditure profile reducing the intensity while the top line is growing.

-    Donald Trump will deregulate the sector leading to more pricing power and take away the regulatory risks.

-    Cable will also be a disruptor to wireless in the future.

There is a lot of upside still to come for Charter which is underestimated by the investment community. Nearly everyone needs broadband. Charter has the potential to double its customer base over time. Charter is 4x leveraged and TCI wants it to stay that way. In 2012, half the profits were coming from the TV business. Today only 22% come from TV. Hohn thinks that about 90% of the real value of the business is in broadband.

John Malone is the largest shareholder with about 20% of the equity and 25% of the voting rights. TCI own about 5% of the company. Malone is one of the world’s great investors with compounded returns of about 30% per annum. He is shareholder friendly and is committed to share buybacks.

Hohn always tries to find businesses that are protected from competition.  TCI have returned 17% per annum net of fees for the last 13 years using this approach. It is hard to break into the fiber broadband market. Google tried recently but have now essentially given up. The industry has effectively become a duopoly between Charter and Comcast (CMCSA), even then because they do different things they are monopolistic within their sectors. Charter has pricing power. It has been raising its pricing by 5% per year. Charter has 30% margins but these could rise to 50% or even 55%.

Risks: the TV business could decline, unbundling will come, wireless could be a threat.  Cable will be a disruptive player in wireless. Both Comcast and Charter will probably enter the wireless sector. He thinks Verizon may try to buy Charter in the future.

Be sure to check out the rest of the Sohn London conference presentations here.

Adrian Croxson Long Ryanair: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Adrian Croxson head of European Equities at Och-Ziff Management who pitched long Ryanair (LON:RYAN).

Adrian Croxson's Sohn London Conference Presentation

Long Ryanair Holdings (LON: RYAN) 

Och-Ziff have owned Ryanair stock for two years. Ryanair’s own projections suggest that they can grow volumes at 8% per year for the next 8 years. They have enough capacity to do that because they have lower costs. They fly 120 million passengers per year. Demand for air travel will continue to grow. Ryanair keeps taking market share from competitors. It can grow market share from 15% to 25% over the next few years.

It is the lowest cost producer in Europe with 50% less overhead than main competitor Easyjet. Staff costs are low due to route density not necessarily because they pay staff less. They require fewer crews as staff can work out of more than one airport. Landing costs for Ryanair have been flat over the last couple of years because they have gone into airports where other airlines have gone bust.  They have a good record for buying planes cheaply as they tend to buy when demand is low. They are getting better at cross selling passengers hire cars and hotels. They do not spend a lot of money on marketing.

Net income can double in the next seven years and the share count will diminish due to buybacks. The CEO owns £1bn of stock.

Be sure to check out the rest of the Sohn London conference presentations here.

Robert Bishop Long Rio Tinto: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Robert Bishop of Impala Asset Management who pitched long Rio Tinto (LON: RIO).

Robert Bishop's Sohn London Conference Presentation

The macro backdrop is set fair for commodities:

-    Emerging market (EM) demand is improving. If you are going to invest in a mining company you need to believe that EM markets are getting economically stronger because they account for 65% of metals demand and 55% of oil demand. China is the key player and Bishop believes it hit bottom in January 2016.

-    The US and EU infrastructure replacement cycle is just starting. Trump will generate more ‘bang for your buck’ than any previous President.

-    More fiscal stimulus is coming worldwide

The micro background is also positive:

-    The 5 year downtrend in metal prices is over. The longest in 125 years.

-    Metals supply and demand is coming back into line. Copper and zinc already have a supply deficit. Small supply shocks will now lead to bottlenecks in the supply chain and push prices higher.

He believes we are at the start of a new commodity cycle. China will expand construction and infrastructure spending on roads, railways and other forms of transportation. Capital spending in the mining sector is at the bottom of the cycle.

Rio Tinto is the largest miner in the world. It is the large cap, high quality way to play the new commodity cycle. It is the low-cost producer. It lost its way in 2007-2013 with ill-timed acquisitions. Since then it has focused on cutting costs and improving efficiencies. It now has better operating leverage. Capital expenditure has been reigned in and the company is now in a harvesting phase.

Iron ore prices are the key to the Rio Tinto investment.  Prices need to keep going up. Demand has outstripped supply this year. There will be more demand for steel from India, China and the US. The demand for steel in the US and Europe will be driven by fiscal stimulus programmes that will be better for commodities than quantitative easing.

Be sure to check out the rest of the Sohn London conference presentations here.

Erik Karlsson Long Autoliv & Philips: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Erik Karlsson of Bodenholm Capital who pitched two long ideas: Autoliv and then Philips.

Erik Karlsson's Sohn London Conference Presentation

Before co-founding Bodenholm in 2015, Erik Karlsson was a partner and senior analyst at AKO Capital, 2007-2015. 

Long Autoliv 

Autoliv is the global leader in seat belts and airbags with 38% market share. It has grown organically by an average of 4% for the last 10 years and has had a stable EBIT margin of 8-10% most years. It returns 90% of its FCF through dividends and buybacks. The market values Autoliv at 13x next year’s earnings.

Autoliv will gain market share because its main competitor, Takata, has had product failures that led to accidents and the largest auto recall in US history. Since those events two years ago Autoliv has won 55% of all new orders. There is a long lead time in the industry so Autoliv will only get paid 3 years on but the sales are guaranteed. EBIT margin will expand from 8% to 11% by 2019.

They have too much cash on their balance sheet and could buyback more stock. Takata is up for sale and Autoliv could launch a takeover of Takata or a part of it. Buying a distressed company could be risky but management is conservative and have a good acquisitions track record. Takata are forced sellers so Autoliv could strike a good deal.

Good things can happen to the stock if the company experiences growth in net income and PE expansion. With Takata sidelined, Autoliv may be able to increase prices.

To lose money on the Autoliv investment, sales would have to decline 5% and the stock would have to de-rate to 11x EPS. If that happens it would lead to a 10% loss in the investment over the next year. 

Long Philips (AEX: PHIA) 

Philips has become a better and smaller business. It is only half the size it was 18 years ago. It has been divesting its electronics businesses and becoming more focused on health. There are 4 parts to the business:

- Personal health: e.g., razors

- Health technology: dialysis technology

- Diagnostic treatment: medical equipment

- Connected care

It is achieving higher and more stable organic growth. New Philips is growing at about 4% per year. Margins will improve, FCF will improve. Margins are particularly good in personal health. The company has nearly finished restructuring. Once it has divested its lighting business that is separately listed it will be able to move into a net cash position by 2018.

The company is getting better at capital allocation. It has increased buybacks and dividends and returned Euro 8 billion since 2011 or 38% of its average market cap. Few companies in Europe achieve that. It may lever up a bit to 1.5x net debt in the future. Philips could become the ‘European Medtech.’

To lose money on an investment in Philips revenues would have to decline 2%, margins would have to fall to half the company predicts and the stock would have to de-rate to 13x cashflow.

Be sure to check out the rest of the Sohn London conference presentations here.

Nicolas Walewski Long B&M Value Retail: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Nicolas Walewski of Alken Asset Management who pitched a long of B&M Value Retail (LON:BME).

Nicolas Walewski's Sohn London Conference Presentation

Long B&M Value Retail (LON: BME) 

B&M Value Retail is a UK mid-cap, retail discounter that floated at a high valuation in 2014. The stock has de-rated since then. It sells quite a narrow range of 5500 mostly non-food items. Two-thirds of its products sell at less than £3. B&M is growing very fast with sales growth of 44% CAGR over 10 years. It is expected to grow its sales by 15% over the next few years. It has leading industry returns – 20% return on capital employed.

The business model is capital light. The payback period for a new store is just 8 months (a traditional retailer takes 3-5 years). Most of B&M’s stores are in northern England. It has plans to expand into the south-east.

B&M sells products that are usually 30-50% cheaper than its competitors. It can do this because it buys direct from China without any intermediaries. They buy narrow, they buy deep, and they buy cheap. Typically, they buy an entire line of production so they get a good price. B&M does not own prime locations.

The leadership is good. CEO, Simon Aurora, has been with the firm 12 years and has grown the business from 20 stores to over 500. He owns 21% of the shares. The chairman is the experienced ex-Tesco CEO, Sir Terry Leahy.

B&M has established a presence in Germany. It has bought a majority stake in Jawoll with 56 stores. The German management will likely be replaced by Simon Aurora in a year or two.

The share price has been hit by Brexit. It is very cheap. B&M can become the Dollar General (DG) of Europe.

What are the risks? Two issues worry the market. Gross margins and like-for-like sales. The market is worried that Brexit and the devaluation of the Pound will lead to higher import costs. If inflation does pick up, discounters will take market share. You are better off with B&M than a mainstream retailer. B&M pays back the cost of new stores very quickly so it does not need high growth in like-for-like sales, 1 to 2% per year is enough.

Be sure to check out the rest of the Sohn London conference presentations here.

Masroor Siddiqui Short Aryzta: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Masroor Siddiqui of Naya Capital Management who pitched short Aryzta (VTX:ARYN).  He was previously a partner at Chris Hohn's TCI.

Masroor Siddiqui's Sohn London Conference Presentation

Aryzta is a Switzerland based speciality baker. It supplies companies like Tim Hortons (QSR) and Starbucks (SBUX).

The business does not have a moat and it would be easy for competitors to enter their space. The leverage is high at 4.5x. The margin reporting is questionable. EBITDA reporting is heavily adjusted. Their reported margins are similar to companies that own lots of brands like Nestle yet Aryzta does not own brands.

They may have been pulling forward receivables which is okay but it is a one-off game. There has been no organic growth to talk about since 2008. Their margins are not sustainable as the industry is becoming more competitive. Siddiqui thinks they are having difficulties refinancing. That is worrying at a time when borrowing is so easy. They may require a rights issue soon.

Aryzta has a new Chairman with a good reputation for restructuring. Siddiqui thinks this is a positive for the short side as he will want to raise new equity.

Be sure to check out the rest of the Sohn London conference presentations here.

Anne-Sophie d'Andlau Long Euro Disney: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Anne-Sophie d'Andlau of CIAM who pitched long Euro Disney (EPA:EDL).

Anne-Sophie d'Andlau's Sohn London Conference Presentation

Long Euro Disney (EPA: EDL) 

Euro Disney listed in Paris in 1989 but has never made a profit. The shares are down 99% since floatation. Euro Disney has a complicated ownership structure with Walt Disney US owning 77%.

Euro Disney is the most popular tourist destination in Europe with 15 million visitors per year. The reason it has never made a profit is due to the heavy royalties and management fees it has to pay to Walt Disney US. Net income has always been negative. The licensing fees are three times the accepted market practice. Without the fees, Euro Disney would be as profitable as other Disney theme parks. Euro Disney has a long history of restructurings. Shareholders have been diluted by around 9x. CIAM estimate that over the last ten years Euro 930 million has been overcharged by the Walt Disney company.

About 18 months ago, Walt Disney launched a minority buyout to take Euro Disney private at $1.25 per share, a price that d’Andlau described as ridiculous.  It was after the buyout proposal that CIAM got involved.

The Euro Disney business is divided into two segments.

-    Resort activities: theme parks, hotels

-    Real estate

CIAM have identified unrecognised value in the real estate assets of about Euro 1.9 billion or about half the land value of Euro Disney. This valuation is not included in the company accounts or in the takeover documents. CIAM think the takeover price should be 3x higher. This has led CIAM to take 3 actions.

-    They opposed the minority buyout by Disney US to take the company private at $1.25. Euro Disney is still listed. They are challenging the regulator who gave the deal the go-ahead in the Supreme Court.

-    In the Criminal Court, they are taking judicial action against Disney US for favouring Disney shareholders over Euro Disney shareholders. More specifically they are accusing Disney of the misuse of corporate assets, the publication of misleading accounts and managing a company for the sole interest of the majority shareholder.

-    CIAM is also taking a civil case to try to recover the Euro 930 million that they believe has been siphoned off from Euro Disney over the last 10 years.

Be sure to check out the rest of the Sohn London conference presentations here.

Elif Aktug Long Leonardo: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Elif Aktug who is the Agora Fund Manager at Pictet Asset Management and pitched long Leonardo (BIT:LDO), formerly known as Finmeccanica.

Elif Aktug's Sohn London Conference Presentation

Long Leonardo (BIT: LDO)  

Leonardo has had a name change and used to be Finmeccanica.

The company is primarily a defence contractor manufacturing helicopters for military and civil use and global defence electronics. The transportation business has been sold off.

Margins have held up well between 11-12%. They have a strong order book. It is cheap compared to other defence contractors. Leonardo has a high-quality management team.

Be sure to check out the rest of the Sohn London conference presentations here.

Ivan Martin Aranguez Long Sonae: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Ivan Martin Aranguez of Megallanes Value Investors who pitched a long of Sonae (ELI:SON).

Ivan Martin Aranguez's Sohn London Conference Presentation

Long Sonae (ELI: SON) 

Sonae is a mid-cap diversified holding company with assets in Portugal. It is run by the Azevedo family who own 52%. Sonae has a good track record, it has 28 years of annual book value growth at an average of 6.5%.

Sonae has a complex structure. It is a largest player in food retail in Portugal (66% of the business) and the second largest telecoms operator in Portugal (33% of the business).  It also has a real estate arm (9%) and an investment business (3%). The share price has de-rated since 2015. There is now a 45% discount to NAV. Only two analysts cover the company.

Sonae’s largest business, food retail, has achieved good margins of 6-7% in recent years. This is at a time when there has been a price war in groceries in Portugal. Sonae is the lowest cost producer and well placed to resist competition. It has some good brands including Warten and Sports Zone. A sum of the parts valuation gives Euro 1.45 per share, a discount to NAV of 45%.

Be sure to check out the rest of the Sohn London conference presentations here.

Marc Chatin Short Australian Banks: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Marc Chatin of Parus Fund who pitched a short of Australian banks.

Marc Chatin's Sohn London Conference Presentation

Parus fund is a $2 billion AUM global long/ short equity fund with a net annualized return of 15% since 2003.

Investment idea: Short Australian banks

There are four large Australian banks that make up 80% of market share. Chatin did not distinguish between them, implying they were equally shortable. Banks in Australia have had a good run with +200% upside. They trade on a PE of 12-14x; PB 1.4-2.2x.

Real estate has been booming. Price to income ratio 5.6x for the whole country but 6.4x in metropolitan areas. Debt ratio to household income +200%.

On the supply-side, housing starts are up 200% in the last two years. House prices are beginning to fall. Transaction volumes are coming down – a leading indicator of price.

Demand for Australian housing comes partly from Chinese buyers who make up 10 to 15% of transactions. Total mortgages are up 15% but delinquencies are still low now. Construction will fade. House prices will come down.

Be sure to check out the rest of the Sohn London conference presentations here.

Michel Massoud Long Opera Software: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Michel Massoud of Melquart who pitched a long of Opera Software (STO:OPERAO).

Michel Massoud's Sohn London Conference Presentation

Long Opera Software (STO: OPERAO) 

Opera is a mobile advertising focused tech company listed in Oslo. Market cap $1 billion. It has divested its consumer business – mobile desktop browser for $575 million. The remaining businesses are: 

- Opera Media Works – an advertising agency. 

- Bemodi – the most exciting part. The Netflix of mobile apps. It is run on a subscription basis and has thousands of apps. It has become popular in some emerging market countries, particularly in Brazil. It is growing fast and rolling out into 20 markets.

- Opera TV, based in Poland. A tech business with stable revenues.

The catalysts ahead: Opera has lots of cash from the sale of the of the browser business. They can pay down debt, return a third to shareholders via dividends and buybacks. There is 30% upside if Opera re-rates.

There could be further disposals: Opera TV and the Skyfire business. Sum of the parts valuation suggests upside of 60-84%

Risks: cyclicality, seasonality; Bemodi has not been tested outside of Brazil; the difficulties involved in realising value via disposals.

Be sure to check out the rest of the Sohn London conference presentations here.

Dureka Carrasquillo Long Mobileye: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Dureka Carrasquillo, Senior Portfolio Manager at the Canadian Pension Investment Board for long/short equity in the EME region and pitched long Mobileye (MBLY).

Dureka Carrasquillo's Sohn London Conference Presentation

Long Mobileye (NYSE: MBLY) 

Mobileye is an Israeli software company based in Jerusalem. It is a pure play on autonomous cars. It develops software algorithms for damage limitation, analysis, and action.

-    It makes sensors – camera, radar and lidar (a surveying method that measures distance to a target by illuminating that target with a laser light)

-    It makes mapping software for telling autonomous cars where to go

-    Driving software to tell the car how to drive in different places

They have done deep research on autonomous cars. They visited over 150 factories. From invention to coming to market all major innovations in the car industry have taken about 30 years. Expect the first driverless car in 2020. Driverless cars could be a $600 billion market by 2030.

One of the biggest strengths of the company is that it owns the meta data. Ownership will be the best way to monetise the data in a market that will be dominated by large, powerful players. If Mobileye can gain 4% penetration of the global fleet of autonomous vehicles by 2020 then it is trading on 10x 2020 earnings.

Be sure to check out the rest of the Sohn London conference presentations here.

Mans Larsson Long Grand City Properties, Nos: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Mans Larsson of Makuria Investment Management who pitched two long ideas: Grand City Properties (GER:GYC) and Nos (ELI:NOS).

Mans Larsson's Sohn London Conference Presentation

Mans Larsson - founded Makuria Investment Management in 2013. Makuria has $775 million AUM and invests long / short across the capital structure with a bias towards credit and special situations.

Long Grand City Properties (GER: GYC) 

Grand City Properties is a German specialist real estate company focused on densely populated areas. It focuses on multi dwelling units – basic accommodation. It is a mid-cap company that is trading near 52-week lows. German residential property has good fundamentals. There is acceleration in rental growth (about 4% annual growth). Unlike many countries, real estate value in Germany has not grown in recent years. There is no history of home ownership in Germany but that is changing.

Grand City Properties could raise their rents as they are 20% below the market. The founder and chairman owns 33% of the stock and are well aligned with shareholders. The stock trades at a 20% discount to replacement cost. Cashflow is growing organically in the mid-teens. Cashflow can grow from Euro 144 million today to Euro 200 million in three years.

Grand City has issued perpetual bonds at rates as low as 2.5%. That will be a huge help to them if rates rise.

Long Nos (ELI: NOS) 

Nos is a Portuguese mid cap company that is a leading provider of cable TV, fibre broadband and 4G networks. It is a high-quality business with predictable and growing FCF. Nos trades at below 13x operating cashflow. It is is the leading cable TV provider in Portugal growing their market share from 25% in 2012 to 30% today. It has invested heavily in the last few years and now has the best in class fibre optic broadband and 4G network. It also has good set top box technology.

The capital expenditure phase is now over allowing Nos to move from an investment to a harvesting phase. Recently Nos and Vodaphone have agreed to share football rights which should reduce the price war between the two players.

The Portuguese stock market is one of the cheapest markets in Europe. Nos’s valuation is compelling at about 6x EBITDA. Pricing is low and could be raised. The cable business is relatively recession proof. The Portuguese economy is improving. Leverage is about 2x which is not high for the industry.

Be sure to check out the rest of the Sohn London conference presentations here.

Bo Bortemark Long Ferrovial: Sohn London Conference

We're posting notes from the Sohn London investment conference 2016.  Next up is Bo Bortemark of Carve Capital who pitched long Ferrovial (BME:FER).

Bo Bortemark's Sohn London Conference Presentation

Long Ferrovial (BME: FER)  

Ferrovial is based in Spain and owns high quality transportation assets. The company does a lot of things but the best businesses are toll roads in Canada and managed lanes in the US. The UK and Australian businesses are struggling. Growth in the toll road business is accelerating. The stock is down 33% from its 2015 high. It is trading at a 50% discount to NAV.  Bo Bortemark is also the cofounder of

Be sure to check out the rest of the Sohn London conference presentations here.

Friday, December 2, 2016

Hedge Fund Links ~ 12/2/16

Summary of the Robin Hood conference: Einhorn, Tepper, Druckenmiller etc [ValueWalk]

Profile of Renaissance Technologies' secretive Medallion Fund [Bloomberg]

Reflections on the Trump Presidency, after the election [Ray Dalio]

How T. Boone Pickens sits tight in the riskiest of businesses [NYTimes]

The next generation of hedge fund stars: data-crunching computers [NYTimes]

Treasury officials are warning hedge funds could create the next big crisis [Vox]

Bill Ackman's 2016 fortune: down, but far from out [NYTimes]

Omega's Einhorn sees Trump's policies boosting stocks [Reuters]

Tourbillon's Jason Karp says Trump will make stock pickers great again [Reuters]

John Paulson got Trump elected and now has favor to ask [Vanity Fair]

Jim Chanos says Valeant was biggest loser ever for hedge funds [CNBC]

Credit Suisse said raising $2 billion for hedge fund stakes [Bloomberg]

Tyrian Investments to close [Reuters]

Hedge fund strategies no longer correlated with equity returns [Investing]

Female fund managers are a rarity across the globe [Morningstar]

This is why alternatives are worth it [ValueWalk]

Fairholme Capital Adds To Sears Canada Position

Bruce Berkowitz's investment firm Fairholme Capital has filed a 13D on shares of Sears Canada (SRSC).  Per the filing, Fairholme now owns 20% of SRSC with 20.37 million shares.

This is an increase of 153,354 shares since the end of the third quarter.  The filing was made due to activity as recent as November 29th with the bulk of their purchase coming at $1.79 per share.

You can view the rest of Fairholme's equity portfolio in the new issue of our newsletter here.

Per Yahoo Finance, Sears Canada "operates as a multi-format retailer in Canada. It operates department stores that offer a range of merchandise, including apparel, home fashions, and appliances; home stores, which provide home furnishings, appliances, and home electronics; outlet stores that sell surplus merchandise."

Thursday, December 1, 2016

20% Off Boyar's Forgotten Forty Report: Special Offer for Market Folly Readers

Each year, Boyar Research publishes their Forgotten Forty report which features the 40 stocks they believe have the greatest potential for capital appreciation in the year ahead, with an emphasis on near-term catalysts.

Their 2017 report will be released soon and Boyar has kindly given Market Folly readers a special 20% discount if you purchase by December 12th.

Each stock profiled in their report features a one page write-up summarizing the investment thesis, valuation, and what the potential catalyst is.

Boyar is also giving our readers a complimentary copy of their Guide to Profiting From Uncertainty.  This 100+ page report features in-depth research on 4 additional stocks.

Free Copy of Last Year's Report

To see what you can expect from the Forgotten Forty report, we've received permission from Boyar to post last year's edition for free which you can download here

And then you can save 20% off this year's Forgotten Forty report here.

Performance of Stocks in the Forgotten Forty Report

As you can see below, the Forgotten Forty has significantly outperformed the major indices on a 3, 5, 10, and 15 year basis.  Also, last year's report has outperformed the S&P by 400 bps and eight of the stocks profiled returned north of 31% each.

Special Discount Expires in 11 Days

This special 20% discount for our readers expires December 12th, so take advantage before it's too late.  Thanks again to Boyar for their generosity.

To receive your 20% discount, please click here.

Wednesday, November 30, 2016

What We're Reading ~ 11/30/16

Warren Buffett's meeting with University of Maryland students [UMD]

Is the next financial crisis on its way? [Steve Eisman]

A write-up on the impending Hilton (HLT) spinoff [Clark Street Value]

CBRE (CBG): industry deep dive to detect an emerging moat [Punch Card]

A look at Discovery Communications (DISCA/K) [Contrarian Edge]

Sustainable sources of competitive advantage [Collaborative Fund]

Why deep learning matters and what's next for AI [Algorithmia]

The unexpected genius of Facebook's Mark Zuckerberg [Fortune]

Google's online travel adventure upsets its biggest advertisers [Bloomberg]

A billionaire's dreams of creating a guns empire [NYMag]

If oil refiners crash, so will the economy [WSJ]

Mastercard, Visa set to reap spoils of India's war on cash [Bloomberg]

How Best Buy (BBY) fought Amazon [WSJ]

The evolution of media & entertainment: conversation with CEOs [YouTube]

How to get comfortable with being umcomfortable [Inc]

Why gut feelings may really help you make risky decisions [Washington Post]

Why stoicism is one of the best mind-hacks ever devised [Aeon]

Tuesday, November 29, 2016

Paulson & Co Sells Some Extended Stay America / ESH Hospitality

John Paulson's hedge fund firm Paulson & Co has submitted numerous SEC filings regarding its position in Extended Stay America (STAY) and ESH Hospitality.

Per a Form 4, Paulson sold 4.67 million shares of STAY and ESH Hospitality on November 18th at $14.76 as part of a secondary offering.  Following this sale, Paulson & Co still owns 16.8% of the company with 33 million shares of STAY.

You can see the rest of Paulson & Co's portfolio in the newly released issue of our Hedge Fund Wisdom newsletter.

Extended Stay America and ESH Hospitality are paired shares.  Per the filing, "Each paired share is comprised of one share of common stock of Extended Stay America and one share of Class B common stock of ESH Hospitality, which shares are paired and traded as a single unit.

Per Google Finance, Extended Stay America is "an integrated owner/operator of company-branded hotels in North America. The Company operates in hotel operations segment. Its business operates in the extended stay lodging industry. It owns and operates approximately 630 hotels comprising over 69,400 rooms located in approximately 40 states across the United States and in Canada. It owns and operates its hotels under its core brand, Extended Stay America, which serves the mid-price extended stay segment. In addition, it owns and operates over three Extended Stay Canada hotels. It operates its hotels owned by ESH Hospitality, Inc. (ESH REIT). The hotels are operated by the Operating Lessees, subsidiaries of the Company and are managed by ESA Management LLC (ESA Management), a subsidiary of the Company. ESH Strategies, a subsidiary of the Company, owns the brands related to its business. The Company's extended stay hotels are designed to provide lodging or apartment accommodations." 

This is the second time Paulson has trimmed its Extended Stay America position in the past few months.

Balyasny Asset Management Boosts Emerge Energy Services Stake

Dmitry Balyasny's hedge fund firm Balyasny Asset Management has filed a 13G with the SEC regarding shares of Emerge Energy Services (EMES).  Per the filing, Balyasny now owns 8.2% of EMES with 2.26 million shares.

This is an increase in their position size by over 1 million shares since the end of the third quarter when they owned 1.17 million shares.  The filing was made due to activity on November 18th.

For more from this fund, we've highlighted other recent portfolio activity from Balyasny here.

Per Google Finance, Emerge Energy Services "owns, operates, acquires and develops a portfolio of energy service assets. The Company's segments include Sand segment, Fuel segment and Corporate. The Company's Sand segment consists of the production and sale of various grades of industrial sand primarily used in the extraction of oil and natural gas, as well as the production of building products and foundry materials. Its Fuel segment operates approximately two terminals and over two transmix processing facilities that are located in the Dallas-Fort Worth, Texas area and Birmingham, Alabama. In addition to refining transmix, the Fuel segment sells a suite of complementary fuel products and services, including third-party terminaling services, certain reclamation services and blending of renewable fuels. The Company's other services include blending of renewable fuels into petroleum products, and the manufacture of biodiesel at its Birmingham facility."

Carlson Capital Trims Forestar Group & Archrock Positions

Clint Carlson's hedge fund firm Carlson Capital has filed two separate 13D's with the SEC.

Carlson Trims Forestar Group Position

First, Carlson has submitted a 13D filing on Forestar Group (FOR) which indicates they now own 7.55% of FOR with 2.54 million shares.  This is down 323,800 shares from the 2.86 million shares they owned at the end of the third quarter. 

The filing shows they were selling at various dates in November, and as recently as November 21st at prices ranging from $11.60 to $12.8064.

Per Google Finance, Forestar Group is "a residential and mixed-use real estate development company. The Company operates through three segments: Real Estate, Oil and Gas, and Other Natural Resources. Its Real Estate segment secures entitlements and develops infrastructure on its lands for single-family residential and mixed-use communities, and manages its undeveloped land, commercial and income producing properties, mainly a hotel and its multifamily properties. Its Oil and Gas segment is an independent oil and gas exploration, development and production operation and manages its owned and leased mineral interests. Its Other Natural Resources segment manages its timber, recreational leases and water resource initiatives. The Company owns directly or through ventures interests in approximately 60 residential and mixed-use projects consisting of over 7,000 acres of real estate located in approximately 10 states and approximately 20 markets."

Also Trims Archrock Stake

Second, Carlson Capital also submitted an SEC filing regarding their stake in Archrock (AROC).  Per the filing,  Carlson owned 12.17% of the company with 8.47 million shares as of November 18th. 

However, Carlson has continued selling per a separately filed Form 4 with the SEC.

Some of their recent activity includes selling 453,433 shares in total on November 22nd, 23rd, and 25th at prices around $13.4951 to $13.7899.  At latest tally, Carlson owned 7.79 million AROC shares.

Per Google Finance, Archrock is "formerly Exterran Holdings, Inc., is a natural gas contract operations services company. The Company also provides natural gas compression services to customers in the oil and natural gas industry throughout the United States and supplies aftermarket services to customers that own compression equipment in the United States. The Company's segments include contract operations and aftermarket services. The contract operations segment primarily provides natural gas compression services to meet specific customer requirements. The aftermarket services segment sells parts and components, and provides operation, maintenance, overhaul and reconfiguration services to customers having compression and oilfield power generation equipment. The Company also has equity interest in Archrock Partners, L.P. (the Partnership), a master limited partnership that provides natural gas contract operations services to customers throughout the United States."

Monday, November 28, 2016

ValueAct Capital Reduces Allison Transmission Stake

Jeff Ubben's activist investment firm ValueAct Capital has filed a 13D with the SEC regarding its position in Allison Transmission (ALSN).  Per the filing, ValueAct now owns 6.4% of ALSN with 10.52 million shares.

Per a separately filed Form 4, they sold 2.9 million shares on November 17th at $31.78 and sold an additional 1.4 million shares on November 21st at $32.34.  After these sales, ValueAct still owns 10.52 million shares.

This is the second time ValueAct has trimmed its Allison Transmission stake in recent months.

Per Google Finance, Allison Transmission is "design and manufacture commercial and defense fully-automatic transmissions. The Company manufactures fully-automatic transmissions for medium- and heavy-duty commercial vehicles and medium-and heavy-tactical the United States defense vehicles. The Company operates through manufacture and distribution of fully-automatic transmissions segment. The Company's transmissions are used in a range of applications, including on-highway trucks (distribution, refuse, construction, fire and emergency), buses (primarily school, transit and hybrid-transit), motorhomes, off-highway vehicles and equipment (energy, mining and construction) and defense vehicles (wheeled and tracked). The Company's transmissions are sold under the Allison Transmission brand name and remanufactured transmissions are sold under the ReTran brand name. The Company has developed over 100 different models that are used in over 2,500 different vehicle configurations." 

Welling on Wall Street Interview With Boyar Value Group

Welling on Wall Street recently interviewed Boyar Value Group's Mark Boyar and Jonathan Boyar and talked about various topics including: their investment strategy, some of their current favorite stock ideas, and behavioral finance.

On investing, Mark Boyar noted that, "Patience is probably one of the most important elements of stock market investing.  First, you have to find the great business at a good price, then you have to have patience, the fortitude and the ability to withstand gyrations in the stock market.  That element is critically important."

They also share their thoughts on stocks such as Madison Square Garden (MSG), QVC (QVCA), Discovery Communications (DISCA/K) and more.

Check out the full interview embedded below:

You can download a .pdf copy here.

12 West Capital Exits Diana Containerships & Euroseas Positions

Joel Ramin's hedge fund 12 West Capital has filed two 13D's with the SEC regarding shares of Diana Containerships (DCIX) and Euroseas (ESEA). 

Per the filings, 12 West no longer owns any shares of either company as of November 17th.  Shares of DCIX and ESEA spiked massively in mid-November (422% and 172% respectively) and it looks like the fund took advantage of that to liquidate its positions.

They sold DCIX shares at $6.26, $5.51 (weighted average), and $4.89 on November 17th and 18th.

Per Google Finance, Diana Containerships is "engaged in the business of ownership of containerships. The Company is engaged in the seaborne transportation industry through the ownership of containerships and operates its fleet through Unitized Ocean Transport Limited (UOT), a subsidiary of the Company. UOT provides the Company and its vessels with management and administrative services. The Company's fleet consists of approximately seven panamax and over six post-panamax containerships with a combined carrying capacity of approximately 66,440 twenty-foot equivalent unit (TEU) and a weighted average age of over 9.7 years. The Company's vessels include SAGITTA, CENTAURUS, PAMINA, CAP DOUKATO and PUCON."

Per Google Finance, Euroseas is "engaged in the shipping business. The Company is an owner and operator of drybulk and container carrier vessels and is a provider of seaborne transportation for drybulk and containerized cargoes. Eurobulk Ltd. manages the Company's operations. The Company also owns and operates dry bulk carriers that transport major bulks, such as iron ore, coal and grains, and minor bulks, such as bauxite, phosphate and fertilizers. The Company has a fleet of 12 vessels, including Kamsarmax drybulk carrier, Panamax drybulk carriers and Handymax drybulk carrier, Intermediate containerships, Handysize containerships, and Feeder containerships. The Company’s five drybulk carriers have a total cargo capacity of 351,272 deadweight tons (dwt), and its seven containerships have a cargo capacity of 11,828 twenty-foot equivalent units (teu)."

Joho Capital Adds To GrubHub Position

Robert Karr's Joho Capital has filed a 13G with the SEC regarding its position in GrubHub (GRUB).  Per the filing, Joho now owns 5.1% of the company with over 4.37 million shares.

This means they've increased their position size by 935,100 shares since the end of the third quarter when they owned 3.43 million shares.  The filing was made due to activity on November 14th. 

Per Google Finance, GrubHub is "a provider of an online and mobile platform for restaurant pick-up and delivery orders. The Company connects more than 40,000 local restaurants with diners in more than 1,000 cities across the United States. For restaurants, Grubhub generates higher margin takeout orders at full menu prices. The Company's target market is primarily consists of independent restaurants. Diners can access the platform through and The Company offers diners access to the network through its mobile applications designed for iPhone, iPad, Android, iWatch and Apple TV devices. The Company provides a corporate program that helps businesses address problems in food ordering and associated billing. In certain markets, the Company also provides delivery services to restaurants on its platform that do not have their own delivery operations. and provide an aggregated database of approximately 380,000 menus from restaurants."

Tuesday, November 22, 2016

New Issue Of Our Quarterly Newsletter Just Released: See What Top Hedge Funds Are Buying & Selling

The brand new Q3 issue of our Hedge Fund Wisdom newsletter was just released and summarizes the latest 13F filings of 25 top hedge funds.  Subscribers: please login at to download.

Featured In The Brand New Issue

- Investment Thesis Summaries of 2 stocks hedge funds have been active in: Find out which stocks and why.  The 2 stocks that were featured in our August issue are up 30% and 4.5% versus 0.6% for the S&P 500.

- Consensus Buy / Sell Lists: See what the most popular stocks are

- Reveals Portfolios of 25 Top Investors (With New Funds This Issue): The newsletter now also includes Glenn Greenberg's Brave Warrior Advisors & John Scully's SPO Advisory, along with 23 others (full list here)

- Commentary On Each Fund's Moves: Including short positions in European markets

To see what the newsletter looks like, check out a free full past issue here. 

To Read The New Issue Immediately, Subscribe Below

1-year Subscription (4 issues): $299.99 per year (save 20% with this option)

Quarterly Subscription: $89.99 per issue

Want to pay by check or soft dollar account?  Please email us:
info (at) hedgefundwisdom (dot) com

Monday, November 21, 2016

Last Chance: Next Week's Family Office Super Summit

We’re coming down to the wire for the Family Office Super Summit taking place in Miami next week. If you did plan to attend be sure to take advantage of the amazing offer that Market Folly has negotiated with the Family Office Club. Market Folly readers can attend this 2-day conference for just $299 (compared to $699 standard price). To save big, use promo code “Save400” on the form at the bottom of this page:  

This is an exceptional opportunity to connect face-to-face with the wealth managers that oversee  billions of dollars for some of the most successful and affluent families in the world. Family office-led panel discussions and presentations will cover a range of topics including allocation trends, fund manager selection, co-investing, and more. To see the agenda, speaker lineup, and everything that is included with your admission visit  

Remember: as a Market Folly reader you can attend this world-class event for just $299 so register today using the promo code “Save400” at or sign up over the phone by calling Sophia Akom at the Family Office Club at (305) 503-9077.  See you next week in South Florida.

PointState Capital Discloses Comstock Resources Stake

Zach Schreiber's hedge fund firm PointState Capital has filed a 13G with the SEC on shares of Comstock Resources (CRK).  Per the filing, PointState now owns 9.99% of the company with 1.49 million shares.

This is a newly disclosed equity position for the firm and the filing was made due to activity on November 8th.

Per Google Finance, Comstock Resources is "an energy company engaged in the acquisition, exploration, development and production of oil and natural gas in the United States. The Company operates in the segment of exploration and production of oil and natural gas. The Company's oil and gas operations are concentrated in Texas and Louisiana. Its operations are focused in two operating areas: East Texas/North Louisiana and South Texas. The Company's properties in the East Texas/North Louisiana region include approximately 80,660 acres in the Haynesville or Bossier shale formations. The Company's Eagleville field includes approximately 30,220 acres located in the oil window of the Eagle Ford shale in South Texas. The Company owns interests in over 1,575 producing oil and natural gas wells, and operates over 950 of these wells. The Company owns interests in over 20 wells in the Rosita field, located in Duval County, Texas."

Stone House Capital Reduces USA Truck & A.M. Castle Positions

Mark Cohen's investment firm Stone House Capital has submitted two filings to the SEC regarding its positions.

Reduces USA Truck (USAK) Stake

First, in a 13G with the SEC regarding shares of USA Truck (USAK), Stone House disclosed it now owns 7.1% of USAK with 588,961 shares.

This is a reduction of 246,039 shares since the end of the second quarter when they previously owned 835,000 shares.  The filing was made due to activity on November 15th.

Per Google Finance, USA Truck is "a truckload carrier providing transportation of general commodities throughout the continental United States and into and out of portions of Mexico and Canada. The Company operates through two segments: Trucking and Strategic Capacity Solutions (SCS). The Trucking segment consists of truckload and dedicated freight services. The SCS segment consists of freight brokerage and rail intermodal services. The Company transports full dry van trailer loads of freight from origin to destination without intermediate stops or handling. The Company offers a range of truckload and logistics services to a customer base that spans a range of industries. The Company's fleet of approximately 1,832 tractors consists of 1,568 company tractors and 264 independent contractor tractors. The Company owns approximately 6,200 trailers. The Company also transports general commodities into and out of Mexico by allowing through-trailer service from its terminal in Laredo, Texas."

Also Trims A.M. Castle (CAS) Position

Second, Stone House also filed an amended 13D with the SEC regarding its stake in A.M. Castle (CAS).  Per that filing, Stone House now owns 10.9% of CAS with 3.55 million shares.

This is also a reduction of 448,065 shares since the end of the second quarter when it owned 4 million shares previously. 

The filing indicates they were selling on November 9th, 201th, 11th, and 14th at prices of between $0.4962 and $0.5313.

Per Google Finance, A.M. Castle is "a specialty metals distribution company. The Company operates through two segments: Metal and Plastics. In its Metals segment, the Company focuses on distributing engineered specialty grades and alloys of metals, as well as providing specialized processing services. Its products include alloy, aluminum, nickel, stainless steel, carbon and titanium. Inventories of these products assume various forms, such as plate, sheet, extrusions, round bar, hexagon bar, square and flat bar, tubing and coil. The Company's Plastics segment includes its subsidiary, Total Plastics, Inc. (TPI). The Plastics segment stocks and distributes a range of plastics in forms that include plate, rod, tube, clear sheet, tape, gaskets and fittings. Processing activities within this segment include cut-to-length, cut-to-shape, bending and forming according to customer specifications. The Company distributes and performs processing on both metals and plastics."

Wednesday, November 16, 2016

What We're Reading ~ 11/16/16

Thinking strategically: the competitive edge in business, politics, and everyday life [Dixit]

Is value investing broken? [Gannon on Investing]

Understanding the art of doing nothing [Pragmatic Capitalism]

India's demonetization - what's next? [Marginal Revolution]

How to find the most persistently profitable companies [Gannon on Investing]

How investors develop bad habits [A Wealth of Common Sense]

On overconfidence and the scout mindset [Abnormal Returns] 

A pitch on American Tower (AMT) [Broad Run]

Inside Intel's race to build a new reality [Techcrunch]

In-depth interview with Liberty's John Malone [CNBC]

Interview with Michael Mauboussin [Motley Fool]'s Richard Liu takes on Alibaba in cutthroat contest for Chinese consumers [Forbes]

Guide to stocks potentially impacted by a Trump presidency [StreetInsider]

How your brain decides without you [Nautilus]

Tuesday, November 15, 2016

49 Reasons to Attend the Family Office Super Summit & Market Folly Discount

The Family Office Super Summit is less than two weeks away and seats are almost filled.  To register for just $299, use Market Folly's exclusive promo code “Save400” to instantly save $400 off admission at this link:

Besides having an excuse to escape chilly weather to head south to sunny Miami, here's forty-nine reasons to attend this family office gathering in Miami.

Here's the speakers list:

1.    Pierre duPont – HPM Partners ($1B+ Family Office)
2.    Matthew Storm – CV Advisors (Top-50 MFO)
3.    Eric Munson – Private Family Office (SFO)
4.    Angus West – Perspecta Trust ($1B+ Family Office)
5.    Howard Cooper – Cooper Family Office (SFO)
6.    Candice Beaumont – L Investments (SFO)
7.    Timothy Jacobson – Pearl Capital Advisors (SFO)
8.    Eric Wilcomes – DuPont Capital (Pension Fund)
9.    Steven Waters – World Vision (Non-Profit)
10.    David Fisher – Bentley Capital (SFO)
11.    Michael Felman – ShoreFront Capital (SFO)
12.    Steven Simmons – Sideris Capital Partners (SFO)
13.    Tom Groos – Tyden Venture & City Light Capital (SFO)
14.    They maintain a great balance of investment executives and family offices, so many of the 700 reserve seats have been allocated to the 250+ family office executives in attendance
15.    Stacia Wells – Bilzin Sumberg
16.    Ira Perlmuter – T5 Equity Partners (SFO)
17.    Federico Benavides – Beamonte Investments (SFO)
18.    Russell Deakin – Brazil Family Office (SFO)
19.    Michael Nelson – Eagle Bay Advisors (MFO)
20.    Richard Klitzberg – McDaniel College (Endowment)
21.    Marie Arrigo – EisnerAmper LLP
22.    3 jam-packed days included with admission, including the Early-Arrivals Cocktail Reception on November 28th. This cocktail reception is open to all attendees who will be in town the night before the conference. You can view the Super Summit schedule here:
23.    Michael Sury – Indorus Holdings (SFO)
24.    Sasha Bernier – Cheltenham Investments (SFO)
25.    Richard C. Wilson – The Miami Family Office (SFO)
26.    Andrew Beaton - Capital Dynamics ($1B+ Asset Manager)
27.    Paul Smith – NAPLIA
28.    Mitch Garrett – Trump Hotels (SFO & Hospitality Investor)
29.    With catered breakfast, lunch, and cocktail receptions as well as breaks throughout, you will have plenty of opportunities to interact with all the high-power executives in attendance
30.    Doug Fullaway – FourteenPlus, LLC
31.    Theodore O’Brien – The Detroit Family Office (SFO)
32.    Jeff Kissee – Capital 8 Group
33.    Vincent Pica – Safanad Inc. (SFO)
34.    Quickly add dozens of family offices and institutional investors to your relationship network, learn how they like to partner with other investors and investment managers, and become more effective in quickly navigating the family office industry
35.    Irwin Boris – Confidential Family Office (SFO)
36.    Sebastian Jano - Himan Brown Charitable Trust (SFO)
37.    Brian Shelley – Colmena Group (SFO)
38.    Karin Ford - MUFG ($1 trillion+ Asset Manager)
39.    Anthony Annino – Perspecta Trust ($1B+ Family Office)
40.    David Sobelman – Generation Income Properties
41.    JP Maroney – Harbor City Capital Management
42.    Jake Harris – Harris Bay
43.    Katherine Zamsky – Besyata Investment Group (SFO)
44.    Richard Stone – Palm Beach Investment Research Group (Non-Profit Investor Club)
45.    For nearly a decade, the Family Office Club has offered a 100% money-back guarantee on all our events so you have peace of mind registering.
46.    James Rubin – Resurgence Asset Management
47.    Carl Sheeler – Berkeley Research Group
48.    Jeff Evans –  Volta Global (SFO)
49.    Brendan Holt Dunn – Holdun Family Office (SFO)

Bonus – Reason #50: Admission for this 2-day event is just $299 for Market Folly readers (compared to $699 normal price). This special discount is only valid for the first 5 professionals to register. Use promo  code “Save400” 

Register for the event, browse the agenda and view the speaker line-up here:

If you have any questions you can give the Family Office Club a call at (305) 503-9077.

Howard Marks' Latest Memo: 'Go Figure'

Oaktree Capital's Chairman Howard Marks has been penning quite a few more letters than usual recently.  He's just released another one entitled 'Go Figure' where he talks about the results of the US Presidential election and implications.

Embedded below is Howard Marks' latest memo, 'Go Figure':

You can download a .pdf copy here.

Senator Investment Group Starts Brookdale Senior Living Stake

Alex Klabin and Doug Silverman's hedge fund firm Senator Investment Group has filed a 13G with the SEC regarding shares of Brookdale Senior Living (BKD).  Per the filing, Senator now owns 6.82% of BKD with over 12.69 million shares.

This is a newly disclosed equity position for the firm as they didn't report owning any shares as of the end of the third quarter.  The filing was made due to activity on November 4th.

You can view other recent portfolio activity from Senator here.

Per Google Finance, Brookdale Senior Living "is engaged in the operation of senior living communities in the United States. The Company has five segments: Retirement Centers; Assisted Living; CCRCs-Rental; Brookdale Ancillary Services, and Management Services. Its Retirement Centers segment includes owned or leased communities that are designed for middle to upper income seniors. Its Assisted Living segment includes owned or leased communities that offer housing and around the clock assistance with activities of daily life to mid-acuity frail and elderly residents. Its CCRCs-Rental segment includes owned or leased communities that offer a range of living arrangements and services to accommodate all levels of physical ability and health. Its Brookdale Ancillary Services segment includes the outpatient therapy, home health and hospice services. The Company's Management Services segment includes communities operated by the Company pursuant to management agreements."

Friday, November 11, 2016

Pershing Square Trims Platform Specialty Products Position

Bill Ackman's hedge fund Pershing Square has filed an amended 13D with the SEC regarding its position in Platform Specialty Products (PAH).  Per the filing, Pershing now owns 14.5% of the company with 40.45 million shares.

This is a decrease of 2.28 million shares since the end of the second quarter when they owned over 42.73 million PAH shares.  The filing was made due to activity on November 10th when they sold shares at $8.78.

For more from this firm, we've highlighted other recent Pershing Square portfolio activity.

Per Yahoo Finance, Platform Specialty Products is "produces and sells specialty chemical products in the Americas, the Asia-Pacific, and Europe. It operates through two segments, Performance Solutions and Agricultural Solutions."

Hedge Fund Links ~ 11/11/16

Hedge funds are hiding out in gold [Bloomberg]

Carl Icahn left Trump victory party to bet $1 billion on stocks [Bloomberg]

Bridgewater: stocks will tank if Trump wins [Business Insider]

The money management gospel of Yale's endowment guru [NYTimes]

One hedge fund laid out why the market feels so dangerous right now [Yahoo]

New Goldman Sachs ETF tracks popular hedge fund stock bets [Reuters]

Thursday, November 10, 2016

Stan Druckenmiller: "I Basically Have a Large Bet on Economic Growth"

Duquesne Family Office founder Stan Druckenmiller appeared on CNBC today to give his thoughts on the markets and election. 

He noted that after the election a lot of regulation will be taken out of the system which should help get things going.  Other changes like tax reform, especially reducing the corporate tax rate encouraged him as he was "quite optimistic" on the economy.

Druckenmiller said that, "I have a large bet on economic growth ... I'm short bonds globally ... I'm short bunds, I'm short Italian bonds, I'm short US bonds.  I like sectors of the equity market that respond to growth, value, and materials, not things like staples and traditional growth stocks." 

He also added he likes the US dollar, with an emphasis against the euro.  And he has dumped his gold long (he actually sold during the night of the election).  He noted the reasons he previously owned it for 'might be ending.'

Druckenmiller also added, "If it wasn't for the messy conflict of rates rising with the stronger economic growth through fiscal policy, I would think there's so much low hanging fruit in terms of deregulation and tax reform, we could get a jolt of 4 percent growth for about 18 months."

That said, he's also cautious that interest rates rising could push that down to high 2, low 3 percent growth.  "I think the market is going to force this.  The market is going to push them to raise interest rates if my hopeful scenario turns out to be right."

He added that monetary policy essentially helped get Donald Trump elected as it caused a 'massive reallocation' of wealth from the middle class to the rich.

"Dr. Copper: have you seem him lately?  It's been rising.  Interest rates have been at stupid levels, they've been held down... they're like beach balls under water."

Embedded below are some of the videos from Druckenmiller's interview on CNBC

Video 1

Video 2