<![CDATA[Monday Morning Links]]>https://www.mondaymorninglinks.comhttps://substackcdn.com/image/fetch/$s_!CQwU!,w_256,c_limit,f_auto,q_auto:good,fl_progressive:steep/https%3A%2F%2Fsubstack-post-media.s3.amazonaws.com%2Fpublic%2Fimages%2F88f2cd48-2e68-4d41-81bd-38a0ccba6b3b_256x256.pngMonday Morning Linkshttps://www.mondaymorninglinks.comSubstackSun, 19 Apr 2026 22:43:17 GMT<![CDATA[Moving back to Asian Century Stocks]]>https://www.mondaymorninglinks.com/p/moving-back-to-asian-century-stockshttps://www.mondaymorninglinks.com/p/moving-back-to-asian-century-stocksMon, 12 Feb 2024 04:21:25 GMTI’ve decided to shut down this Substack and focus 100% on Asian Century Stocks － my newsletter focusing on equities in the Asia-Pacific.

All paid subscribers to Monday Morning Links have been refunded. Money should be returned to your accounts within days. If you have any issues receiving your money, let me know, and I’ll sort it out for you.

In the future, I will occasionally send out “Links round-up” emails from my Asian Century Stocks Substack. These will come infrequently but be better curated. And they will focus on Asian equities only.

Asian Century Stocks
Links round-up
Today, I’m reviving curation posts here on Asian Century Stocks. These will called “Links round-ups”. I’ll send them out whenever I have something to share. The focus will be on Asian ideas only. Out of today’s links, I was most intrigued by Jam Invest’s comments on Hong Kong engineering services provider Analogue Holdings. The company installs HVAC systems, water treatment systems, lifts and escalators, etc. It owns a stake in Nanjing Canatal Data-Centre Environmental Tech, whose value represents around 50% of Analogue’s market cap. The normalized P/E ratio is around 5-6x…
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2 years ago · Michael Fritzell

Why am I doing this?

Well, when I spun off Monday Morning Links as a separate newsletter, I thought it had the potential to become a major success. But engagement has been weak. Most readers appreciate the effort but aren’t willing to pay for it.

I’d spend 5-7 hours each week consuming content, planning ahead of what to include in each week’s post. These hours became difficult to justify given how revenues for Monday Morning Links plateaued from December onwards around the US$5k level:

Gross annualized revenues for the Monday Morning Links Substack

So, from now on, I’ll spend all my time on Asian equities instead. This focus will help me provide better insights and ensure the Asian Century Stocks Substack becomes as good as humanly possible.

If you’re still looking for curation of global stock ideas, there are several others on Substack who are doing a great job at it. Here are a few of my favorites:

  • Capital Employed Top Stock Pitches: LINK

  • Toffcap Monday Monitor: LINK

  • From $100K to $1M BWM: LINK

  • RhinoInsight Friday Roundup: LINK

  • Stock Analysis Compilation: LINK

Abd if you want tips on how to curate content, feel free to reply to this email, and I will guide you in the right direction. A few tips: you can use the Pocket Casts feed to sort through recent podcasts, you can plug RSS feeds from Substack into Feedly and there are a few dozen websites with great links such as Offpiste Investing, Value & Opportunity, the r/SecurityAnalysis subreddit and the Letters and Reviews blog.

I also want to give a shout-out to Eric Frisch and Ian Bezek, who assisted with a few posts over the past few weeks. Here are the links to their Substacks, in case you want more insights from them:

Ian’s Insider Corner
Investing letter focused on high-quality businesses and LatAm stocks.
By Ian Bezek
ESG Hound
Sniffing out the latest in corporate compliance and sustainability
By Eric Roesch

All the best, and let’s keep in touch!
Michael Fritzell

]]><![CDATA[Monday Morning Links Week 6]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-6https://www.mondaymorninglinks.com/p/monday-morning-links-week-6Mon, 05 Feb 2024 04:00:14 GMTI loved the interview with real estate investor Starwood Capital’s Barry Sternlicht. He thinks high interest will cause “accidents” in the US commercial real estate sector. Properly adjusted, inflation has already come down, but Powell is behind the curve. He thinks interest rates will come down by June. By then, it will become obvious that inflation is below 2% and the US economy is slowing down.

I also liked Alluvial Capital’s write-up on Net Lease Office Properties. Spin-off dynamics might explain the low valuation. It’s also helpful that the company is in the midst of a liquidation process that’s acting as a near-term catalyst. Exactly what prices they’ll get for their office properties requires industry expertise, but I assume that Alluvial is conservative with its US$130/square foot estimate in its US$38/share valuation.

Finally, I recommend Pyramids & Pagodas interview with the CEO of Plover Bay Technologies. I’ve written about the stock in the past. It has all the hallmarks of a compounder stock: great management, rational capital allocation, a strong product portfolio (as far as I can tell), benefitting from secular trends, expected top-line growth of 20% per year, a net-cash balance sheet and a low valuation of just 10x P/E.

Americas:

  • Invariant on US tobacco company Altria (🇺🇸 MOMO US - US$1.1 billion)

  • Almost Mongolian on Lundin-backed Africa Oil (🇨🇦 AOI US - US$832 million)

  • Laughing Water Capital on spectrum owner Nextnav (🇺🇸 NN US - US$451 million)

  • Eagle Point Capital on Esquire Financial (🇺🇸 ESQ US - US$392 million)

  • Alluvial Capital on Net Lease Office Properties (🇺🇸 NLOP US - US$360 million)

  • Toffcap on engineering company ADF Group (🇨🇦 DRX CN - US$198 million)

  • Greystone on SaaS company Sylogist (🇨🇦 SYZ CN - US$153 million)

Europe, Middle East & Africa:

Asia-Pacific:

  • Jam_invest with a quick note on Yum China (🇨🇳 YUMC US - US$14 billion)

  • Pyramids & Pagodas with CEO of Plover Bay Tech (🇭🇰 1523 HK - US$279 million)

(estimated reading time)

(listening time)

Image
Stock markets in the Scandinavian countries offered the best nominal total return between 1970 and 2022 in US Dollar terms. Source: SEB
]]><![CDATA[Monday Morning Links Week 5]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-5https://www.mondaymorninglinks.com/p/monday-morning-links-week-5Mon, 29 Jan 2024 04:00:23 GMTThe best write-up I’ve read recently is John Hempton’s note on US sportswear retailer Hibbett Sports. His fund, Bronte Capital, is a major shareholder and sees potential in its subsidiary, City Gear. He makes the case that Nike supports City Gear since it offers access to small-town and rural customers. Sneakers are collectable and status symbols, so there’s certainly the potential for profits. Hibbett trades at 8.0x P/E.

Dan Wang’s beautifully written 2023 letter provides great insight into the minds of young Chinese disillusioned with the direction in which the country is going. He thinks Xi might have been correct in his crackdowns, but it’s also led to paralysis and weak consumer confidence. On the positive side, Chinese companies are doing well in solar photovoltaics, EV batteries, automotive and several other industries. And Dan thinks the opening-up reform will not be fully reversed:

“Chinese have had 40 years to engage more with the rest of the world, and Xi is not a good enough storyteller to convince everyone to fully turn inwards once more.”

I also want to call attention to the puke we saw in the Hang Seng index last week (see the chart below). The index reached almost exactly the same level as in the panic of October 2022. Share prices have now stabilised after the Chinese government promised forceful steps to restore investor confidence. Hong Kong equities remain among the cheapest of any major market, in my view.

Americas:

  • Firebird Management on payment company Fleetcor (🇺🇸 FLT US - US$21 billion)

  • Value Don’t Lie on Advance Auto Parts (🇺🇸 AAP US - US$3.9 billion)

  • Overlooked Alpha on Spin Master (🇨🇦 TOY CN - US$2.8 billion)

  • BrightGate Capital on Northeast Bank (🇺🇸 NBN US - US$433 million)

  • John Hempton on Hibbett (🇺🇸 HIBB US - US$804 million)

  • Mokapu Capital on Carriage Services (🇺🇸 CSV US - US$379 million)

Europe, Middle East & Africa:

  • Maran Partners on homebuilder Vistry Group (🇬🇧 VTY LN - US$4.3 billion)

  • Cockney’s Substack on Avon Protection (🇬🇧 AVON LN - US$363 million)

  • No Deep Dives on Macfarlane Group (🇬🇧 MACF LN - US$249 million)

Asia-Pacific:

  • Value Punks on HDFC Bank (🇺🇸 HDB US - US$131 billion)

  • Continuous Compounding on Round 1 (🇯🇵 4680 JP - US$1.1 billion)

  • Clark Square Capital with an update on Webcentral (🇦🇺 WCG AU - US$53 million)

(estimated reading time)

(listening time)

  • Jeff Gundlach on making money in 2024 (15 mins)

  • Bob Robotti provides his value picks for 2024 (53 mins)

  • Rob Vinall answering investor questions at the AGM a few weeks ago (1:32 hours)

  • Ed Yardeni sees parallels with the Spanish flu and is hence bullish (41 mins)

  • David Kotok on Fed policy and what it means for US stocks (1:12 hours)

  • Terry Smith on why active management still matters (he’s obv. biased) (55 mins)

  • Capital Group’s Vice Chair Jody Jonsson on global investing (52 mins)

  • Lake Cornelia’s Judd Arnold on the offshore drillers (1:10 hours)

  • Anas Alhajji on his 2024 oil market update and war in the Middle East (1:10 hours)

  • Juan Salerno on how Argentina is changing under Milei (53 mins)

  • Acquired Podcast on Novo Nordisk (3:45 hours)

The Hang Seng Index trades at the same level as before the 1997 handover. Source: Bloomberg
]]><![CDATA[Monday Morning Links Week 4]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-4https://www.mondaymorninglinks.com/p/monday-morning-links-week-4Mon, 22 Jan 2024 04:01:45 GMTI really enjoyed Dungeon Investing recent post on Sega Sammy. This firm is the result of a merger between SEGA, the classic video gaming company, and Sammy, a gambling and resorts company. Dungeon argues that Sega Sammy is slowly winding down its cash cow Pachinko business and that it will reinvest the proceeds into the more promising video game operations. Dungeon believes SEGA’s video game IP is underutilized and points to efforts now under way to monetize the Sonic franchise through new games, movies, and a TV show. Shares currently trade for 7.9 times trailing earnings.

Boaz Weinstein, founder of Saba Capital Management, offered a great interview on The Money Mondays. His activism in close-end funds is fascinating — his $5 billion fund regularly fights with CEF managers such as Blackrock (AUM of $9 trillion) and wins a surprising amount of the time. I also enjoyed Weinstein’s poker stories and approach to charitable giving.

And in the wake of several recent high-profile M&A deal failures, Nelson Smith from Canadian Dividend Investing gives his thorough guide to investing in odd lot tenders, M&A arbitrage, and other special situations. His tips for finding odd lot tender opportunities and rules for special situation investing are particularly useful. According to Smith: “They say arbitrage is picking up nickels in front of a steamroller; if you’re selective enough you can minimize the risk to picking up quarters in front of golf carts.”

Americas:

  • No Deep Dives on Bel Fuse (🇺🇸 BELF.A & BELF.B US - US$830 million)

  • Mokapu Capital on Carriage Services (🇺🇸 CSV US - US$351 million)

  • Daikoku Investing on Medical Facilities Corp. Daikoku offers a detailed 24-page write-up on this under-the-radar hospital operator. (🇨🇦 DR CN - US$166 million)

  • Special Situation Investing on Fortitude Gold (🇺🇸 FTCO US - US$147 million)

  • Hourglass Investing on M-Tron Industries (🇺🇸 MPTI US - US$115 million)

Europe, Middle East & Africa:

  • Librarian Capital on Unilever (🇬🇧 ULVR UK - US$118 billion)

Asia-Pacific:

  • Elliot’s Musings on Coupang (🇰🇷 CPNG US - US$27 billion)

  • Dungeon Investing on Sega Sammy (🇯🇵 6460 JP - US$3.1 billion)

  • Amit Wadhwaney of Moerus Capital Management on Cromwell Property Group (🇦🇺 CMW AU - US$656 million)

  • Asian Century Stocks on Imax China (🇨🇳 1970 HK - US$317 million) ($)

(estimated reading time)

  • Canadian Dividend Investing’s rules for merger arbitrage, odd lot tenders, and other special situations. (19 mins)

  • Kevin Xu details concerns about the CHIPs Act and America’s efforts to support its domestic semiconductor industry. (5 mins)

  • Speedwell Snippets with 10 business lessons from Copart’s 40 years of success. (13 mins)

  • Warden Capital year-end letter focusing on the REIT market with detailed discussion on various categories of commercial real estate. (20 mins)

  • The International Investor on investing in Asian data centers. (3 mins)

  • Investment Talk on traits that are red flags in investors. (7 mins)

  • Wall St Gunslinger on why he’s buying a basket of American multi-family apartment REITs. (11 mins)

  • Apricitas Economics on America’s recent boom in new business formation and entrepreneurship. (14 mins)

  • Citywire offers four LatAm banking picks to cash in on the region’s growth. (6 mins)

  • Nitin Bajaj of Fidelity Asian Values with his 2024 Asian investment outlook. (4 mins)

  • Tyler Cowen on why he thinks Javier Milei’s economic revolution in Argentina only has a 30-40% chance of success. (2 mins)

  • Buyback Capital on the power of focus. (5 mins)

(listening time)

  • Boaz Weinstein on closed-end funds, shareholder activism, charitable giving and more. (48 mins)

  • DoubleLine’s 2024 best ideas roundtable featuring Jeffrey Gundlach, James Bianco and others. (13 mins)

  • Jeffrey Towson on BYD’s strategy for building a leading Chinese vehicle and battery company and making the leap to becoming a global brand. (38 mins)

  • Substack author Systemic Investing on global quantitative microcap investing (59 mins)

  • Kathy Jones & Liz Ann Sonders on the Fed’s plans for 2024, inflation, and risk management (26 mins)

  • A Mars Wrigley Asia executive on growth in the confectionary industry, the firm’s expansion into snack foods, and modernizing its supply chain. (21 mins)

  • Ian Bezek on his 2024 outlook for the major Latin American economies and stock markets. (1:05 hours)

Emerging markets stocks are historically cheap, with even the upper quartile being near average value and the lower quartile being around the March 2020 lows. Source: Topdown Charts
]]><![CDATA[Monday Morning Links Week 3]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-3https://www.mondaymorninglinks.com/p/monday-morning-links-week-3Mon, 15 Jan 2024 04:01:22 GMTThe most insightful podcast episode I’ve listened to this year was the interview with Michael Ovitz, the Hollywood talent agent turned Silicon Valley advisor. What makes it worth listening to is understanding how he sizes up talent, including CEOs: they need to be driven, have emotional control and decent manners, and look at you when you speak to them. He suggests spending time with the best talent to understand the appropriate benchmark. He also wrote the excellent book Who Is Michael Ovitz? narrated by himself in the audiobook version.

Bond investor Jeff Gundlach’s latest webinar suggests that the US is about to enter a recession. M2 continues to be negative, and cyclical unemployment is weakening. He expects the Fed to undertake extraordinary measures, including a return to quantitative easing, which will be negative for the US Dollar.

The stock write-up that stood out to me in the past week was Mokapu Capital’s post on Aeroporto Guglielmo Marconi di Bologna (“ADB”). He’s written about the company before, but the airport has continued to improve while the share price is flat. Ryanair signed a 6-year contract with ADB at slightly lower pricing, but on the positive side, aero charges will increase by +10% in 2024. The stock now trades at 14.8x P/E.

Americas:

Europe, Middle East & Africa:

Asia-Pacific:

  • Kris Mehta of Enam Holdings on HDFC Bank (🇮🇳 HDB US - US$150 billion)

  • Jacob Mcdonough on venture capital firm Beenos (🇯🇵 3328 JP - US$117 million)

  • 8% Value Investhink on school Overseas Education (🇸🇬 OEL SP - US$67 million)

(estimated reading time)

(listening time)

Image
US M2 money supply growth remains negative. The longer this situation persists, the more likely that we’ll see a shortage of money at some point. Source: Game of Trades

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 2 ]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-2https://www.mondaymorninglinks.com/p/monday-morning-links-week-2Mon, 08 Jan 2024 04:02:46 GMTWeek one of 2024 is in the book. I love the beginning of the year; it’s a clean slate, full of promise, uncertainty and yes… doubt.

After breathless consensus that 2024 would be a raging bull market again, US markets hit a bit of a snag last week. Some might call it a hangover from the stunning two-month rally that finished 2023 (+17% on the Nasdaq 100 and +22% on the Russell 2000 small cap index since November), and I’m not particularly inclined to disagree. But risk is always on the table, and it can come back in a hurry.

In the past few years, we’ve seen some major trends persist stateside. Particularly, blue-chip tech, with the Magnificent Seven taking over from the FAANG trade, kept marching upwards last year.

But every year, some once-maligned sectors rise from the ashes. These are, hands down, my favorite stories of the investing year. I like to try to predict which left-for-dead sector comes back to life. I am rarely correct, but that never stops me from guessing.

For 2024, I’m calling a relative comeback for US Midstream Companies. This sector has been (kind of) dead money since the great MLP Meltdown of 2015-16. In my view, investors haven’t fully realized the bimodal nature of pipeline asset returns. FERC regulated pipe, in particular, should support dividend yields for the foreseeable future. Utility equities are yielding 3% while pipeline operators (PAA, KMI, ET) with large FERC portfolios seem stuck at 7-9%. Maintenance CapEx remains the elephant in the room, but the risk/reward seems promising, given how expensive US equities have gotten broadly.

Do me a favor and drop a comment below with your favorite hated sector in 2024!

Americas:

  • Special Situation Investing on Eagle Materials (🇺🇸 EXP US - US$6.9 billion)

  • Jared Leary on Dentalcorp. Jared posted his thesis on the Canadian Dental Practice rollup in November, but gives some excellent color on the business in a podcast interview. I think lots of people assume that big healthcare earnings aren’t profitable in Canada, but 93% of dental practices are private in the country. Great listen. (🇨🇦 DNTL CA - US$989 million)

  • Aaron Pek on Dollar General (🇺🇸 DG US - US$29.8 billion)

  • Mokapu Capital on Grupo Aeroportuario del Centro Norte. This report argues that 12x 2023 earnings for this Mexican Airport operator is a steal, given the growth opportunities and European comps trading at 20-30x earnings. (🇲🇽 GAER.F MX - US $3.8 billion)

Europe, Middle East & Africa:

  • Valuabl on Fevertree Drinks PLC, with an interesting and contrarian take that the beverage maker will have significant tailwinds on macro factors (🇬🇧 FEVR GBP - US$1.5 billion)

  • Value Stock Geek on Diageo PLC. Another British Beverage (Alcohol) maker (🇬🇧 DGE GBP - US$78.5 billion)

  • Devin LaSarre on Logista. Sticking with vices this week in Europe, this thesis notes that while tobacco operations make a bulk of the operating profits, growth in non-tobacco operations have macro and operating leverage tailwinds for the Spanish firm (🇪🇸 LOG EUR - US$3.6 billion)

Asia-Pacific:

  • Altay Capital on Asagami Corporation, a Japanese logistics microcap (🇯🇵 9311 JPY - US$50 million)

(estimated reading time)

  • Kat McGowan on Dementia treatment as a proving ground for robotics and machine learning. The clunky way “AI” works may be constructive in adapting to the challenges of mental degradation. (24 Minutes)

  • Noah Smith with a great piece on the future growth potential of an industrialized Africa (11 minutes)

  • As someone with an extensive background in Air Pollution and Climate, I hate over-simplification of Climate Change as a rule; that said, Tomas Pueyo’s breakdown of actionable steps to get Carbon and temperature under control is a good read. (16 minutes)

  • Rick Juzwiak at Slate with an amusing and all too familiar read on Quitting things and the zen of letting go of self-hatred. (8 minutes)

  • Researching Global Stocks’ review of their core portfolio was fun for me, as a total neophyte in emerging market small and mid caps (22 minutes)

  • Great summary on the politics and market dynamics of Nvidia chips in China from Raffaele Huang of the WSJ. (8 minutes)

  • Hunter from Lewis Enterprises discusses factor investing as a nice companion piece to the Wigglesworth Quant Investing feature from last month. (12 minutes)

(listening time)

  • My Worst Investment Ever Podcast had Gabe Marusca on to talk about personal health. This one really hit me hard, because I know the feeling of grinding too hard. Heck, I hit a wall a few times myself last year. This is less “investing” content and more a reminder that your body, the meat sack that holds your brain, needs rest. (47 min)

  • Odd Lots had Craig Fuller of FreightWaves on last week to discuss commercial transport shifts due to geopolitical risks in the Middle East. The focus is a lot on the Red Sea, but Craig has some great observations about the sector as a whole. Highly recommended listening. (55 min)

  • Zach Abraham of Bulwark Capital talks about macro setups for 2024 on the Know Yout Risk Radio Podcast. Zach argues that a recession risk still looms. (53 min)

This chart from Genuine Impact might point to one of the most important metrics for markets in 2024. Apple’s nearly $3 Trillion dollar capitalization is a key support for passive inflows and total market value of US equities. As Apple’s hardware sales plateau (or shrink), can the company keep earnings growing enough via software to support the company’s valuation? The knock-on potential for global markets is massive.

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 1]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-1https://www.mondaymorninglinks.com/p/monday-morning-links-week-1Mon, 01 Jan 2024 04:00:45 GMTHappy New Year! 🎉

Check out the interview with Steve Mandel. What I found fascinating about it is that Mandel’s fund, Lone Pine, pays a great deal of attention to company culture in their investments: what kind of people work there, how they think, what they’re motivated by, etc. That’s served them well with a ~20% CAGR since inception. Mandel likes biographies and recommended those of Ulysses Grant, Abraham Lincoln and Sam Walton.

I found the below idea on Scott’s Liquid Gold fascinating. It’s a consumer products company that’s divested its assets, now left only with a pet business bringing in US$4 million in revenues per year and cash of US$4.4 million (against a market cap of US$12 million). Maran Capital’s Dan Roller has been buying heavily. A few days ago, Scott’s Liquid Gold announced a merger with Horizon Kinetics, a fund manager with US$6.3 billion under management. Scott’s Liquid Gold is likely to own 2-4% of the combined entity. At a typical 3% EV/AUM, I get to a value of about US$5.7 million for the value of the stake in Horizon Kinetics, suggesting further upside to intrinsic value, perhaps as much as 100%.

Finally, have a look at the Tai Cheung idea. It’s a Hong Kong construction company turned property developer, now owning 35% of Sheraton Hotel in Tsim Sha Tsui. It also owns Metropole Square in Sha Tin and residential developments on the Peak and Repulse Bay. The stock now trades at 0.31x tangible book, about half of its historical average. The problem has been cap rate expansion but HIBOR is now peaking. I can vouch for the integrity of David Pun Chan, and the recent share buyback is a testament to his shareholder focus.

Americas:

Europe, Middle East & Africa:

  • Antarctic Circle on serial acquirer BUFAB (🇸🇪 BUFAB SS - US$1.4 billion)

  • Desert Lion Capital on Argent Industrial (🇿🇦 ART SJ - US$45 million)

Asia-Pacific:

  • Bonsai Partners on Indian IT services co Nagarro (🇮🇳 NA9 GR - US$1.3 billion)

  • Patrimonie on Tai Cheung (🇭🇰 88 HK - US$261 million) (French language)

  • DMX Asset Management on Findi (🇦🇺 FND AU - US$39 million)

(estimated reading time)

(listening time)

  • Morgan Housel had a great episode with his top 10 financial skills, including preparing for the unexpected, marrying well, having a BS radar, etc. (16 mins)

  • Alberto Ayuso went on Value Hive to provide a shipping sector primer. He spoke about vessel replacement values, break-even rates and other tricks to gauge value. Favorite accounts: @mintzmyer, @calvinfroedge, @ed_fin (1:16 hours)

  • Adam Wilk on the potential turnaround of Canadian software developer Sylogist, which has been taken over by new CEO Bill Wood, who has a strong track record (59 mins)

  • Venture capital firm Altimeter Capital’s Brad Gerstner on identifying tech winners. Altimeter has a decent track record with a 30% CAGR (1:10 hours)

UK vs. US 12m fwd P/E; source: Barclays Equity Research, 6 December 2023

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[3-question survey]]>https://www.mondaymorninglinks.com/p/3-question-surveyhttps://www.mondaymorninglinks.com/p/3-question-surveyMon, 25 Dec 2023 10:21:42 GMTHi everyone!

Here’s a short survey I’ll use to improve Monday Morning Links. It consists of 3 questions and will take roughly 1 minute to complete. Any feedback will be greatly appreciated!

Just click the button below to fill out the survey:

Fill out survey

Many thanks,
Michael

]]><![CDATA[Monday Morning Links Week 52]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-52https://www.mondaymorninglinks.com/p/monday-morning-links-week-52Mon, 25 Dec 2023 04:03:06 GMTBack to regular programming this week.

I loved the Columbia Business School interview with Egerton Capital’s John Armitage. Armitage has one of the best track records in Britain, compounding capital at a 16% CAGR on the long side. Today, he thinks the BRICS countries are uninteresting due to a lack of reform and poor quality companies. He likes the reinsurance industry (benefitting from high rates), Ryanair (low-cost leader) and First Citizen Bank. He worries that the Russia-China bloc is on a war footing, yet the West doesn’t even realize it’s a war. His favorite recent books & authors include The Mitrokhin Archive, Pierre Lemaitre, John Banville, Colm Tóibín, Katherine Rundell and The Fall of Robespierre.

Another episode with Felix Zulauf, whose predictions I always pay attention to. Zulauf expects equity market weakness until late 2024, with the Magnificent 7 US tech stocks suffering from redemptions. He also expects a weaker US Dollar and a stronger Japanese yen. According to Zulauf, short positions in the Japanese yen are “gigantic”, so when it starts to strengthen, it will do so with force.

The write-up that stood out to me was @JonathanPaxx’s tweets on Roivant Sciences. The Vivek Ramaswamy-backed company has been a great dealmaker in the past. It just sealed a US$7.3 billion deal with Roche for its subsidiary Televant. Roivant also owns a 57% stake in separately listed Immunovant, worth US$3.5 billion. Then there are also ongoing legal proceedings which, if successful, could bring in more than US$4 billion. It also has a pipeline of other drugs. Add it all up, and you get to a value far exceeding the current market cap of US$8.8 billion. Jonathan thinks the stock could be worth twice as much.

In any case, Happy Holidays to everyone, and I’ll see you on the other side of 2023! 🎄

Americas:

  • Secret Sauce on US discount store Dollar General (🇺🇸 DG US - US$29 billion)

  • Scuttleblurb on dating apps run by Match Group (🇺🇸 MTCH US - US$9.6 billion)

  • Jonathan Paxx with a few tweets on Roivant (🇺🇸 ROIV US - US$8.8 billion)

  • Chapter Twelve on energy nano-cap High Arctic (🇨🇦 HWO CN - US$40 million)

Europe:

  • Value & Opportunity on Samse Group (🇫🇷 SAMS FP - US$763 million)

  • Abilitato on Berentzen (🇩🇪 BEZ3 GR - US$58 million) (German language)

Asia-Pacific:

  • Atmos Invest on Kazakhstan fintech company Kaspi (🇰🇿 KSPI LN - US$18 billion)

  • Palliser on its campaign against Samsung C&T (🇰🇷 028260 KS - US$16 billion)

  • Tiago on healthcare equipment firm Japan Lifeline (🇯🇵 7575 JP - US$629 million)

(estimated reading time)

(listening time)

  • John Armitage on how he picks stocks and the current market outlook (52 mins)

  • Felix Zulauf warns of a weaker US stock market, weaker US Dollar (34 mins)

  • The Transcript thinks low-income households are suffering, others not (6 mins)

  • John Huber on US retailers, including his favorite: Floor & Decor (1:19 hours)

  • Yaron Naymark of 1 Main Capital, whose CAGR since inception is 24% (1:14 hrs)

  • Swetha Ramachandran of Artemis on spirits maker Pernod Ricard (47 mins)

  • Kevin Mak pitches Sphere Entertainment, the owner of The Sphere (1:13 hours)

  • Shai Oster on Chinese tech in 2023 incl Bytedance, Tencent, etc. (1:02 hours)

  • Axel Krohne on his approach to value investing in African equities (17 mins)

China’s aggregate government spending is now shrinking. Source: BCA Research

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 51 ]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-51https://www.mondaymorninglinks.com/p/monday-morning-links-week-51Mon, 18 Dec 2023 04:02:38 GMTGood Morning, this time from the USA! Michael has asked me to start contributing to Monday Morning Links, and I couldn’t be more honored. Quick background on me: I’m the author of ESG Hound, a compliance and due diligence-based publication. I have a background in regulatory and operational compliance in Industrials and Oil and gas, but I currently work in the US in financial markets and equity research.

Michael’s vision for this publication is to be global, informative, and interesting. His work on Asian equities is some of my favorite content, partly because it is so far removed from my core areas of focus and expertise. I hope to provide value here by expanding that base of expertise. Please let us know how it’s going: the good, the bad, the ugly.

With that out of the way, I’d like to start off with Capital Incentive’s excellent pitch on OSI Systems . “Security” as an investment pitch has been, for far too long, nearly only focused on the purely digital (“cyber”) side of that equation. Physical security is often either too CapEx-heavy or has no real moat. The linked post makes an excellent case that OSI’s bundled, turnkey package of multiple technologies is differentiated, profitable, and likely to grow in the coming years. Doubly true at the end of this year, with the renewed global focus on Terrorism and political unrest. Some really great, in-depth analysis here.

I’m going to bang the table on this, but the back-and-forth, “will they or won’t they” debate over whether the COP28 Climate Summit agreements would include a statement on “Transitioning Away” from Fossil Fuels entirely misses the point. These COP agreements are always malleable, unenforceable, and primarily political affairs. Actions speak louder than words and on that front, last year’s Inflation Reduction Act opened the floodgates for renewable investment, but we haven’t seen the money flow just yet. Investors bid the Nasdaq 100 up 52% this year, but it’s shocking to me that American renewable energy and infrastructure adjacent stocks did not perform nearly as well. That’s where I’ll be focusing my long-side research going into 2024.

Americas:

Europe:

  • Maynard Paton on Lok’nStore (🇬🇧 LOK LN - US$335 million)

  • The Stock Engineer on Axkid AB (🇸🇪 AXKID SS - US$19 million)

Asia-Pacific:

(estimated reading time)

  • Robin Wigglesworth on the rise and fall (and rise) of successful large quant strategies. The story centers on Clifford Assness but is a fantastic insight into one of the least understood financial market topics. (20 mins)

  • Julian Evans-Pritchard on China’s economic outlook for 1Q2024. (3 mins)

    • Note: I look forward to seeing how ongoing weakness affects export markets, particularly Europe, in 2024 (see chart of the week for more)

  • GaveKal on China’s economic integration with other emerging markets via the historical lens of other big growth markets (12 mins)

  • Michael Mauboussin’s new report on pattern recognition; when it works, but also how it can fail (15 mins)

  • Leo Perry’s beginner's guide to accounting fraud (Part 1, Part 2, Part 3, Part 4, Part 5 & Part 6)

(listening time)

  • Charlie Munger on Costco, crypto and mental models (1:41 hours)

  • My Worst Investment Ever Podcast On the importance of diversification. While nominally a more retail-focused episode, this one is a sobering reminder for professionals about putting aside ego and sticking to long-term, hedged and diversified investing (36 min)

  • Grant’s Current Yield with Guest Brent Donnelly on currency markets, flight to safety; plus a prediction that the current Japanese Yen consensus is the most likely FX trade to catch people offsides in 2024. (38 min)

  • The Security Analysis Podcast with George Livadas of Upslope Capital, on running a L/S Hedge fund in the US and a fun talk about his favorite “core” long, Ball Corp. (42 min)

Chinese Exports By Volume and Price, From Capital Economics

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 50 ]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-50https://www.mondaymorninglinks.com/p/monday-morning-links-week-50Mon, 11 Dec 2023 04:00:06 GMTFelix Zulauf (1 hour) notes extreme positioning in US Treasury bonds, though agreeing that bond yields will probably bottom first in mid-2024. He then pictures a bull market for commodities, as BRICs control 75% of commodities and will use that supply as a weapon in the intensifying conflict he sees with Western nations.

Substack authors Sleepwell Capital & Leandro (1:47 hours) argue that luxury companies need three attributes: 1) obsession with quality and craftsmanship, 2) exclusive & scarce and finally, 3) evoke status. They look at second-hand prices to understand which companies have achieved luxury status. This quote from The Luxury Strategy makes the case that luxury brands need to be aspirational:

“A luxury brand have to have far more people who know it and dream about it than buy it”

Finally, I believe Optimist Fund is onto something with Fiverr (4-page read). It remains the online marketplace for freelance services that I personally favor. The Google Trends chart looks fantastic. The share count dilution is much lower than for most US tech stocks. It generates US$50 million in free cash flow vs an EV of US$775 million. Optimist Fund believes Fiverr can grow at a 23% CAGR in the next five years.

Americas:

  • Fairlight Capital on Ulta Beauty (🇺🇸 ULTA US - US$23 billion)

  • Optimist Fund on online marketplace Fiverr (🇺🇸 FIVR US - US$1.0 billion)

  • Immersion Investments on Bel Fuse (🇺🇸 BELFA US - US$716 million)

  • Ausram on hospital operator Medical Facilities Corp (🇨🇦 DR CN - US$164 million)

  • Donville Kent on clothing retailer Reitmans (🇨🇦 RET CN - US$106 million)

Europe:

  • Mr Market Miscalculates on France’s Ipsos (🇫🇷 IPS FP - US$2.5 billion)

  • Undervalued Shares on e-tailer Hepsiburada (🇹🇷 HEPS US - US$567 million)

  • Palm Harbour Capital on SOTP Ocean Wilsons (🇬🇧 OCN LN - US$488 million)

  • Calico’s Substack on recycler Grupa Recykl (🇵🇱 GRC PW - US$33 million)

Asia-Pacific:

  • Secret Sauce Investing with an update on Nintendo (🇯🇵 7974 JP - US$55 billion)

  • Chow Wood, Carry Water: quick pitch on First Pacific (🇭🇰 142 HK - US$1.6 billion)

(estimated reading time)

(listening time)

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The number of US Chapter 11 Bankruptcy Filings have reached decade-highs. Source: Variant Perception

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 49]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-49https://www.mondaymorninglinks.com/p/monday-morning-links-week-49Mon, 04 Dec 2023 04:04:45 GMTAfter Charlie Munger passed away at age 99, a reader kindly shared his video Psychology of Human Misjudgement. If you listen to any podcast episode this week, make it this one. Munger goes through the most common causes of human misjudgment, including distorted incentives, the urge to reciprocate, social proof, authority bias, commitment bias, etc.

I also loved the interview with British historian Edward Chancellor. He’s bearish on the renewables and the private equity industries since they’re hurting from recent interest rate hikes. Chancellor thinks the best value can be found outside the United States, especially in the UK and Japan.

Finally, have a look at the ASEAN stocks discussed by Ross & Van Compernolle in their recent update. These include Delfi, Velesto, PV Drilling, Marco Polo Marine, CSE Global, Arwana Citramulia, etc. Ross & Van Compernolle believe that the offshore oil & gas services market remains tight as industry capex lags behind demand. They also believe that Indonesia’s economy will benefit from fiscal spending in the run-up to the 2024 election. Most of their stocks trade at single-digit P/E multiples.

Subscribe now

Americas:

  • Hidden Value Gems on Fleetcor (🇺🇸 FLT US - US$18 billion)

  • Value Don’t Lie on Worthington Industries (🇺🇸 WOR US - US$2.3 billion)

  • From $100K to $1M on IDT Corporation (🇺🇸 IDT US - US$738 million)

  • Daikoku Capital: update on American Coastal (🇺🇸 ACIC US - US$365 million)

  • Invariant on cosmetics ingredients maker United-Guardian (🇺🇸 UG US - US$37 million)

Europe:

  • Profit Hunting blog discussing Aker BP (🇳🇴 AKERBP NO - US$18 billion)

  • Librarian Capital with an update on Rémy Cointreau (🇫🇷 RCO FP - US$5.9 billion)

  • Sleepwell on health tech firm Medistim (🇳🇴 MEDI NO - US$349 million)

  • The Micro Investor on HAV Group (🇳🇴 HAV NO - US$29 million)

Asia-Pacific:

  • Jake Barfield on HR-tech company Medley (🇯🇵 4480 JP - US$936 million)

  • DaBao with a short pitch on Well Shin Technology (🇹🇼 3501 TT - US$194 million)

  • Oriental Value on restaurant operator LH Group (🇭🇰 1978 HK - US$97 million)

  • Altay Capital on Kawagishi Bridge Works (🇯🇵 5921 JP - US$64 million)

Subscribe now

(estimated reading time)

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(listening time)

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Image
The current drawdown in US Treasury bonds is by far the highest in 50 years. Source: Financial Times, Plan Maestro

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Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 48]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-48https://www.mondaymorninglinks.com/p/monday-morning-links-week-48Mon, 27 Nov 2023 04:00:17 GMTThe week's highlight is this interview with Nicolai Tangen, formerly at John Armitage’s Egerton Capital and now head of Norway’s sovereign wealth fund. Running a €1 trillion fund, Nicolai’s focus has turned to quality companies and using forensic analysis to weed out the bad apples. He also discusses how they use linguistic analysis to judge management teams; for example, CEOs who use simple words tend to be more truthful. His favorite authors: Angela Duckworth, Adam Grant, Anne Duke.

Montaka Global Investments makes a compelling case that Spotify’s earnings will improve thanks to its first US price increase since 2011, higher pricing power as record labels become less relevant, and better cost control.

For something inspirational, I recommend this speech by American entrepreneur Phil Ruffin, who built up a fortune through innovation in the convenience store sector, clever deals in the casino industry and avoiding stock speculation.

Americas:

  • Antonio on how Uber is finally becoming profitable (🇺🇸 UBER US - US$114 billion)

  • Hedge Fund Girl on recent improvements at Target (🇺🇸 TGT US - US$61 billion)

  • On Jeremy Raper’s campaign at BRAGG Gaming (🇨🇦 BRAG CN - US$128 million)

Europe:

Asia-Pacific:

  • Clark Square Capital on cosmetics maker L’Occitane (🇭🇰 973 HK - US$3.7 billion)

  • Platinum on Indonesian developer Pakuwon (🇸🇬 PWON IJ - US$1.3 billion)

  • Treasure Hunting on TMNT “play” Playmates Toys (🇭🇰 869 HK - US$102 million)

(estimated reading time)

(listening time)

  • Norges Bank’s Nicolai Tangen on his career and investment philosophy (45 mins)

  • Jens Nordvig on the US rate cycle, potential weakness in the USD (1:08 hours)

  • Greg Lippman discussing the US housing market amidst high rates (46 mins)

  • Todd Wenning of Flyover Stocks on how he identifies quality stocks (1:06 hours)

  • Bill Chen thinks now is the time to buy publicly traded REITs (1:55 hours)

  • Fairfax Financial’s Jamie Lowry & Ian Kelly on finding value in Europe (59 mins)

  • Jared Bibler, author of Iceland’s Secret, about Iceland’s 2008 crisis (1:06 hours)

  • David Cumming of the BNY Mellon UK Income Fund on UK equities (28 mins)

  • George Magnus on China’s real estate crisis, demographics and trade (59 mins)

  • The story of how US entrepreneur Phil Ruffin became a billionaire (29 mins)

The property markets that are most vulnerable to rising interest rates include the Scandinavian countries, Canada and Australia. Source: BCA Research

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 47]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-47https://www.mondaymorninglinks.com/p/monday-morning-links-week-47Mon, 20 Nov 2023 04:01:36 GMTThe podcast episode with Jeremy Raper had some good ideas. He thinks the Japanese yen is cheap, with prices out of whack with those in the rest of the world. He’s also finding value in the sub-AU$500 market cap segment in Australia, mentioning Webcentral currently. He’s also constructive on aircraft leasing due to favorable supply & demand and that he “should probably own AerCap”.

Eagle Capital’s post on recent uniform supply company spin-off Vestis also stands out. Its competitor has performed beautifully, with returns on equity above 30%. The P/E of 16.5x is line with the broader market, though note that Vestis does have a fair amount of debt at 4x EBITDA.

Americas:

  • O’Keefe Stevens becoming sceptical of Nvidia (🇺🇸 NVDA US - US$1.2 trillion)

  • Undervalued Shares on e-commerce giant Allegro (🇺🇸 AL0 GR - US$7.7 billion)

  • Secret Sauce on tequila maker Becle (🇲🇽 CUERVO* MM - US$6.2 billion)

  • Eagle Point Capital on uniform spin-off Vestis (🇺🇸 VSTS US - US$2.2 billion)

  • Clark Street Value on MRC Global (🇺🇸 MRC US - US$913 million)

  • Value Don’t Lie: “shorts are wrong about B. Riley” (🇺🇸 RILY US - US$669 million)

  • Generals & Workouts on Theseus Pharma (🇺🇸 THRX US - US$153 million)

  • AlmostMongolian on Voxtur Analytics (🇨🇦 VXTR CN - US$63 million)

Europe:

  • Imperial Brands on Imperial Brands (🇬🇧 IMB LN - US$20 billion)

  • ToffCap on a spin-off from chemicals firm Solvay (🇧🇪 SOLB BB - US$12 billion)

  • Librarian Capital on property portal Rightmove (🇺🇸 RMV LN - US$5.0 billion)

  • Undervalued Shares on Scandinavian Tobacco (🇩🇰 STG DC - US$1.5 billion)

  • 310 Value on travel website eDreams (🇪🇸 EDR SM - US$882 million)

  • Odyssean on power solutions company XP Power (🇺🇸 XPP LN - US$384 million)

  • French Hidden Champions on Catering Int’l Services (🇫🇷 CTRG FP - US$81m)

  • Global Stock Picking on nano-cap OssDesign (🇸🇪 OSSD SS - US$59 million)

Asia-Pacific:

  • Wolf of Harcourt Street on Sea Limited (🇸🇬 SE US - US$21 billion)

  • Miles Kuah on holding company First Pacific (🇭🇰 142 HK - US$1.6 billion)

  • Searching 4 Value on the SOTP of Pasona (🇯🇵 2168 JP - US$537 million)

(estimated reading time)

(listening time)

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A potentially contrarian signal: hedge fund positioning in mega-cap tech has become extreme. Source: Goldman Sachs

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 46]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-46https://www.mondaymorninglinks.com/p/monday-morning-links-week-46Mon, 13 Nov 2023 04:00:36 GMTI liked the interview with Rob Copeland, author of the book The Fund, about Ray Dalio and his company, Bridgewater Associates. Two highlights: 1) Bridgewater’s investing is not systematic but relies on founder Ray Dalio’s hunches. 2) Dalio runs the firm like a cult with him at the centre. The book doesn’t have a smoking gun about Bridgewater, however. It seems to be a legitimate firm.

Out of the below reports, I think AlmostMongolian’s write-up on oil & gas mapping company Mind Technology was the most compelling. A restructuring has caused the company’s net cash to exceed the market cap of US$6 million (excluding the prefs). Further, Mind has positive EBITDA and an order backlog of US$30 million. The only problem is that it’s an illiquid stock.

Finally, I recommend the new Netflix documentary Arnold about Hollywood actor Arnold Schwarzenegger. There’s much to learn from his successes, including having a clear vision, being useful to others, having a positive attitude, etc. Arnold’s favourite quote: “Early to bed, early to rise, work like hell and advertise”.

Americas:

Europe:

  • Voss Capital on Irish cement company CRH (🇮🇪 CRH US - US$41 billion)

  • Undervalued Shares on e-commerce firm Allegro (🇵🇱 ALE PW - US$7.9 billion)

  • Mr Market Miscalculates on PE firm Alba (🇪🇸 ALB SM - US$3.0 billion)

  • Value & Opportunity on shipping spin-off Deme (🇧🇪 DEME BB - US$2.5 billion)

  • Panoramic Capital on media company TX Group (🇨🇭 TXGN SW - US$1.0 billion)

  • Turtles correctly predicted the takeover of GAN (🇬🇧 GAN US - US$74 million)

Asia-Pacific:

(estimated reading time)

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FDI into China has turned negative. Source: Plenum

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 45]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-45https://www.mondaymorninglinks.com/p/monday-morning-links-week-45Mon, 06 Nov 2023 04:00:23 GMTIn the past week, I read Zeke Faux’s book Number Go Up about the cryptocurrency market’s boom and bust. I highly recommend it. The main takeaway for me is the importance of having legal recourse in any investment. Conversely, when you buy a cryptocurrency, there is no assurance of anything. If you prefer a podcast version of the book, consider Barry Ritholtz’s interview with Zeke here.

Paul Tudor Jones’ interview with Stan Druckenmiller is also a must-watch. Stan is starting to see weakness in the US economy and is buying the 2-year US Treasury Bond for that reason. He also thinks the geopolitical situation is the worst he’s seen in his lifetime. In his view, this is not the time to be long stocks.

Out of this week’s company reports, I particularly enjoyed ToffCap’s tweets on Spanish homebuilder Aedas Homes. The company owns scarce land, pays out decent dividends, trades at 50% of NAV and is in discussions with a potential buyer.

Americas:

  • AlmostMongolian on Petrobras prefs (🇧🇷 PBR US - US$99 billion)

  • Analyzing Good Businesses on Amphenol (🇺🇸 APH US - US$50 billion)

  • Hennessy Focus Fund on homebuilder NVR (🇺🇸 NVR US - US$19 billion)

  • Bison Interests on oil services firm Weatherford (🇺🇸 WFRD US - US$7.2 billion)

  • Recurve Capital on Restoration Hardware (🇺🇸 RH US - US$4.4 billion)

  • From $100K to $1m on Black Stone Minerals (🇺🇸 BSM US - US$3.9 billion)

  • Searching 4 Value on Quálitas Controladora (🇲🇽 Q* MM - US$3.2 billion)

  • Value Don’t Lie on John Wiley & Sons (🇺🇸 WLY US - US$1.7 billion)

  • Liberty Park Capital on Tecnoglass (🇺🇸 TGLS US - US$1.6 billion)

Europe:

  • ToffCap with a tweetstorm on Aedas Homes (🇪🇸 AEDAS SM - US$778 million)

  • Cockney’s Substack on Avon Protection (🇬🇧 AVON LN - US$329 million)

  • Buried Treasure on Nordic Paper (🇸🇪 NPAPER SS - US$247 million)

  • Hurdle Rate on accounting SaaS firm Kulcs-Soft (🇭🇺 KULC LN - US$33 million)

Asia-Pacific:

  • Investing with Wes on e-commerce operator JD.com (🇨🇳 JD US - US$42 billion)

  • Asian Century Stocks on tower company China Tower (🇨🇳 788 HK - US$16 billion)

(estimated reading time)

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The top 25 stock exchanges globally. Each bubble represents total market cap for each exchange. Source: Visual Capitalist, @globalvaluehunt

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Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 44]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-44https://www.mondaymorninglinks.com/p/monday-morning-links-week-44Mon, 30 Oct 2023 04:02:12 GMTMy favourite podcast of the week was the interview with Scott Bessent, a former analyst for George Soros and Stan Druckenmiller. Bessent makes money by identifying changes, anomalies, or mistakes policymakers make. He’s bullish on Japan thanks to the weak yen, TSE’s corporate governance reforms and the capitalist economy. He’s bearish on China under Xi Jinping and believes the CCP could blockade Taiwan after the general election in January 2024.

I also recommend Bridgewater alumnus Andy Constan’s interview on Real Vision for those interested in the US Treasury market. He’s starting to see value at the long end of the yield curve, but the US economy remains weak until layoffs in February 2024. The most obvious opportunity in his mind is shorting US equities.

Americas:

  • Rowan Street discussing Meta (🇺🇸 META US - US$763 billion)

  • Librarian Capital on Raytheon (🇺🇸 RTX US - US$114 billion)

  • Invariant Substack discussing Altria (🇺🇸 MO US - US$70 billion)

  • Sleepwell Investments on NVR (🇺🇸 NVR US - US$17 billion)

  • Value Don’t Lie on First Horizon (🇺🇸 FHB US - US$5.9 billion)

  • Capital Incentives on Zurn Elkay Water (🇺🇸 ZWS US - US$4.5 billion)

  • Alluvial Capital on Talen Energy (🇺🇸 TLNE US - US$3.1 billion)

  • Third Avenue on LSB Industries (🇺🇸 LXU US - US$682 million)

  • Shadow Stock on Joint Corp (🇺🇸 JYNT US - US$116 million)

  • Plural Investing on Currency Exchange Int’l (🇨🇦 CXI CN - US$89 million)

Europe:

  • Business Breakdowns on HAL Trust (🇳🇱 HAL NA - US$10 billion)

  • Tachy’s Stack on Rockwool (🇩🇰 ROCK-B DC - US$4.7 billion)

  • Emerging Value on IWG (🇬🇧 IWG LN - US$1.6 billion)

  • Undervalued Shares on Northern Data (🇩🇪 NB2 GR - US$874 million)

  • Atai Capital on Enad Global 7 (🇸🇪 EG7 SS - US$151 million)

  • Moram on industrial chain company Renold (🇬🇧 RNO LN - US$71 million)

  • Calico Capital with an old post on Gibus (🇮🇹 GBUS IM - US$55 million)

  • French Hidden Champions on Memscap (🇫🇷 MEMS FP - US$36 million)

  • The Mikro Kap on Lindbergh (🇮🇹 LDB IM - US$19 million)

Asia-Pacific:

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Source: emerging market closed-end funds are trading at record discounts to NAV. Source: Variant Perception

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links Week 43]]>https://www.mondaymorninglinks.com/p/monday-morning-links-week-43https://www.mondaymorninglinks.com/p/monday-morning-links-week-43Mon, 23 Oct 2023 04:02:21 GMTI enjoyed Jens Nordvig’s discussion of where we are in the US rates cycle. His view is that inflation is trending lower, and as core PCE drops closer to the 2% target, we could see the 10-year at 3.5%. Fed governors also seem to guide for a pause, yet the market doesn’t believe them.

I also liked Andrew Walker’s interview with Jonathan Boyar, discussing Topgolf Callaway Golf, which owns the driving range operator Topgolf and the golf club brand Callaway. It’s clear that Topgolf is an incredible franchise with long-term growth potential, but it’s facing near-term headwinds due to high interest rates. On the positive side, Topgolf Callaway Golf insiders are buying en masse.

Americas:

  • Librarian Capital on Bank of America (🇺🇸 BAC US - US$208 billion)

  • Invariant on Philip Morris’s ZYN and iQOS products (🇺🇸 PM US - US$144 billion)

  • Eagle Point on stock compensation at Autozone (🇺🇸 AZO US - US$44 billion)

  • Moram on The One Group Hospitality (🇺🇸 STKS US - US$139 million)

  • Special Situations Investing on Beaver Coal (🇺🇸 BVERS US - US$76 million)

Europe:

  • Samuel Weber on testing firm Eurofins Scientific (🇫🇷 ERF FP - US$9.4 billion)

  • M17 Capital on cleaning services company ISS (🇩🇰 ISS DC - US$2.6 billion)

  • Abilitato: English language write-up on Italmobiliare (🇮🇹 ITM IM - US$1.1 billion)

  • Cockney’s Substack on Midwich Group (🇬🇧 MIDW LN - US$499 million)

  • Zippy Capital on Civitanavi (🇮🇹 CNS IM - US$125 million)

  • From $100K to $1M on hyped vessel paint maker I-Tech (🇸🇪 ITECH SS - US$46m)

  • French Hidden Champions on Boa Concept (🇫🇷 ALBOA FP - US$30 million)

  • Treasure Hunting on auction house Saga Furs (🇫🇮 SAGCV FH - US$31 million)

Asia-Pacific:

  • Asian Century Stocks on glove maker Hartalega (🇲🇾 HART MK - US$1.5 billion)

  • Allan Gray’s Simon Mawhinney on Alumina (🇦🇺 AWC AU - US$1.5 billion)

  • AVI Japan Opportunity Trust on Takuma (🇯🇵 6013 JP - US$783 million)

  • L1 Capital on oil & gas company Santos (🇦🇺 STO AU - US$16 billion)

(estimated reading time)

(listening time)

  • Jens Nordvig on where we are in the US rate cycle (1:13 hours)

  • Jeff Gundlach’s presentation at the Grant’s conference on US rates (40 mins)

  • Claudio Borio of BIS discussing financial history (1:02 hours)

  • Torsten Slok on the current macroeconomic backdrop (1 hour)

  • Transistor Radio on new US regulations affecting China’s chip industry (54 mins)

  • Hao Hong on China’s housing market and the impact of US rate hikes (26 mins)

  • Bill Smead on his investing approach and his outlook for markets (1:08 hours)

  • Isaac Corre of Governors Lane on his view on event-driven investing (47 mins)

  • George Livadas of Upslope Capital teaching you short-selling (56 mins)

  • Chris Semenuk of Tema ETF on the royalties industry (14 mins)

  • Jonathan Boyar on Topgolf Gallaway Brands (52 mins)

  • Yinan Zhao from Pzena giving an introduction to chemicals giant Olin (59 mins)

Image
Price/book vs return on equity suggests Brazilian shares are undervalued, US shares are overvalued. Source: Morgan Stanley

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links 2023 Week 42]]>https://www.mondaymorninglinks.com/p/monday-morning-links-2023-week-42https://www.mondaymorninglinks.com/p/monday-morning-links-2023-week-42Mon, 16 Oct 2023 04:01:29 GMTBerkshire Hathaway aficionados will enjoy the interview with Todd Combs. He believes short-selling requires an 80-85% hit rate and that generalists win over the long run.

But the real highlight is the interview with Felix Zulauf. He argues that the world is returning to a cold war between US- and China-led blocks of nations. After a mild US recession, he believes inflation and interest rates will head higher, hurting real estate and bond markets.

The stock write-up I found most compelling this week was Wolf of Harcourt Street’s post on Swedish online casino service provider Evolution. Platforms that enable others to make money tend to earn a high return on capital. Its top-line growth has been incredible. The only question marks are regulation and recurring share issuance.

Americas:

  • JustValue on insulation specialist Topbuild (🇺🇸 BLD US - US$7.6 billion)

  • Value Don’t Lie on boat engine producer Brunswick (🇺🇸 BC US - US$5.2 billion)

  • Bonhoeffer on Academy Sports and Outdoors (🇺🇸 ASO US - US$3.2 billion)

  • Left’s Newsletter on prison operator Geo Group (🇺🇸 GEO US - US$1.1 billion)

  • LatAm on sugarcane producer Jalles Machado (🇧🇷 JALL3 BZ - US$490 million)

Europe:

  • Wolf of Harcourt Street on online casino bet Evolution (🇸🇪 EVO SS - US$21 billion)

  • Mokapu Capital with an update on Airtel Africa (🇿🇦 AAF LN - US$5.4 billion)

  • Mr Market Miscalculates on Intermediate Capital (🇬🇧 ICP LN - US$4.8 billion)

  • Invariant on tobacco distributor Logista (🇪🇸 LOG SM - US$3.3 billion)

  • Secret Sauce Investing on the UK bakery Greggs (🇬🇧 GRG LN - US$2.9 billion)

  • Business Breakdowns on the moat of Robertet (🇫🇷 RBT FP - US$2.1 billion)

  • Abilitato on Italmobiliare (🇮🇹 ITM IM - US$1.1 billion) (German language)

  • Daikoku Capital on family holdco Ocean Wilson (🇬🇧 OCN LN - US$436 million)

  • Maynard Paton on consumer lender S&U (🇬🇧 SUS LN - US$322 million)

  • Tweets from Hugo Bazacle on Gentili Mosconi (🇮🇹 GM IM - US$73 million)

  • French Hidden Champions on Fill Up Media (🇫🇷 ALFUM FP - US$25 million)

Asia-Pacific:

  • Asian Century Stocks on property developer COLI (🇨🇳 688 HK - US$22 billion)

  • Kenkyo Investing on Matsumoto Yushi-Seiyaku (🇯🇵 4365 JP - US$423 million)

  • Hurdle Rate on financial services Fiducian Group (🇦🇺 FID AU - US$117 million)

  • Tweets from gezzogero on Okano Valve Mfg (🇯🇵 6492 JP - US$33 million)

(estimated reading time)

(listening time)

  • Todd Combs on the lessons he learnt at Berkshire and elsewhere (1:13 hours)

  • Felix Zulauf believes in a mild recession but long-term stagflation (1:13 hours)

  • Paul Tudor Jones: the US fiscal position is in bad shape: Part 1 & Part 2 (13 mins)

  • Steve Eisman of “Big Short” fame is bearish about US bank stocks (5 mins)

  • Todd Wenning of the Substack Flyover Stocks on finding moaty stocks (51 mins)

  • Peter Mantas on finding quality in the life sciences industry (1:38 hours)

  • Keith Smith of Bonhoeffer with a mining services 101 lesson (1:14 hours)

  • Arvind Sanger discussing nuclear power and the uranium market (53 mins)

  • Bill Chen of Rhizome Partners on opportunities in REITs (1:11 hours)

  • Daye Deng of Value Punks on the Japanese trading companies (50 mins)

  • CLSA’s John Seagrim on shareholder activism in Japan (29 mins)

Bank of America’s fund manager survey suggests that active investors are overweight cash and t-bills. This could suggest relative future underperformance of cash. Source: Bank of America

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

]]><![CDATA[Monday Morning Links 2023 Week 41]]>https://www.mondaymorninglinks.com/p/monday-morning-links-2023-week-41https://www.mondaymorninglinks.com/p/monday-morning-links-2023-week-41Mon, 09 Oct 2023 04:00:33 GMTFrom today onwards, Monday Morning Links will be available to paying subscribers only.

Subscribers will get a weekly email with stock ideas and thought-provoking articles, podcasts and charts － for just $6 per month.

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Americas:

Europe:

  • Invariant on tobacco company Imperial Brands (🇬🇧 IMB LN － US$18 billion)

  • Robin’s Substack on NCAB Group (🇸🇪 NCAB SS － US$920 million)

  • Undervalued Shares on software developer SNP (🇩🇪 SHF GR － US$276 million)

Asia-Pacific:

  • Investing with Wes on China’s Alibaba (🇨🇳 BABA US - US$219 billion)

  • Hurdle Rate on Prime Financial Group (🇦🇺 PFG AU － US$28 million)

(estimated reading time)

(listening time)

The number of small business bankruptcies in the United States has increased in the past few months. Source: The Wall Street Journal

Disclaimer: Monday Morning Links uses information sources believed to be reliable, but their accuracy cannot be guaranteed. The information contained in this publication is not intended to constitute individual investment advice and is not designed to meet your personal financial situation. The opinions expressed in such publications are those of the publisher and are subject to change without notice. You are advised to discuss your investment options with your financial advisers, including whether any investment suits your specific needs. From time to time, I may have positions in the securities covered in the articles on this website.

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