Last week, Lyft became the first of the ride sharing companies to announce plans for an initial public officering, filing its prospectus. It is definitely not going to be the last, but its fate in the market will not only determine when Uber, Didi, Ola and GrabTaxi will test public markets, but what prices they […]
On February 22, Kraft Heinz shocked investors with a trifecta of bad news in its earnings report: sub-par operating results, a mention of accounting irregularities and a massive impairment of goodwill, and followed up by cutting dividends per share almost 40%. Investors in the company reacted by selling their shares, causing the stock price to […]
In my last eight posts, I looked at aspects of corporate behavior from investments to financing to dividend policy, using the data that I collected at the start of 2019, to examine what companies share in common, and what makes them different. In summary, I found that the rise in risk premiums in both equity […]
In my series of data posts, I had always planned to get to dividends and buybacks, the two mechanisms that companies have for returning cash to stockholders, at this point, but an op ed on buybacks by Senators Schumer and Sanders this week, in the New York Times, will undoubtedly make this post seem reactive. […]
Debt is a hot button issue, viewed as destructive to businesses by some at one end of the spectrum and an easy value creator by some at the other. The truth, as is usually the case, falls in the middle. In this post, I will look not only at how debt loads vary across companies, […]
In my last post, I looked at hurdle rates for companies, across industries and across regions, and argued that these hurdle rates represent benchmarks that companies have to beat, to create value. That said, many companies measure success using lower thresholds, with some arguing that making money (having positive profits) is good enough and others […]
In the last post, I looked at how to measure risk from different perspectives, with the intent of bringing these risk measures into both corporate finance and valuation. In this post, I will close the circle by converting risk measures into hurdle rates, critical in corporate finance, since they drive whether companies should invest or […]
I think that all investors would buy into the precept that investing in equities comes with risk, but that is where the consensus seems to end. Everything else about risk is contested, starting with whether it is a good or a bad, whether it should be sought out or avoided, and how it should be […]
I am convinced that each of us is granted moments of grace, where, if we are open to the possibility, we find out what we are meant to do with our lives. For me, one of those moments occurred in the second year of my MBA program at UCLA, when, cash poor, I decided to […]
StoneCo Ltd. (STNE), a financial technology company in Brazil, is up 20% in extended hours trading at $41.44 on higher than expected earnings. It is now 70% above the IPO price of $24 paid by Todd Combs of Berkshire Hathaway in October, 2018. StoneCo Ltd. is a financial technology company based in Brazil, the fourth-largest […]
In an SEC Filing today (Proxy Statement for Annual Meeting of Shareholders), Berkshire Hathaway revealed that Vice Chairmen Ajit Jain and Greg Abel each received $18 million in compensation in 2018. In previous years, prior to their promotion to Vice Chairmen, their compensation had not been revealed.
In an SEC Form 4 filing, Berkshire Hathaway revealed that it added $250 million to its $3 billion stake in Delta Airlines last week at about $49 per share. It currently owns a 10% stake in Delta Airlines.
Today is the 10th Anniversary of the stock market bottom of March 9, 2009. From October 9, 2007 through March 9, 2009 (17 months), the Dow Jones Industrial Average declined by 55%, with the S&P 500 declining by a similar percentage. The Great Recession officially began in December, 2007 and ended in June, 2009. Over […]
Warren Buffett was interviewed on CNBC today from 6 – 9 a.m. ET. The 10 highlights were: (1) Berkshire overpaid for Kraft Heinz which is losing pricing power and market share to private label brands such as Kirkland (Costco). Berkshire is not planning to either buy or sell shares in Kraft Heinz. (2) Ajit Jain and Greg […]
These are 5 quotes from Warren Buffett’s Letter to Shareholders: (1) “2019 will likely see us again expanding our holdings of marketable equities. We continue, nevertheless, to hope for an elephant-sized acquisition. Even at our ages of 88 and 95 – I’m the young one – that prospect is what causes my heart and Charlie’s to […]
Warren Buffett’s Letter to Shareholders and Berkshire Hathaway’s Annual Report were released this morning at 8:00 a.m. ET. Five highlights were: (1) Berkshire Hathaway’s 2018 operating earnings rose by 71% vs. 2017. (2) Berkshire Hathaway’s shares outperformed the S&P 500 (with dividends included) by 7.2% in 2018 and by 21% over the past 5 years. (3) Berkshire […]
On February 22, 2019, Kraft Heinz declined by 27% as a result of an SEC subpoena into its accounting, a $15.4 billion writedown, lower than expected earnings, a 36% cut in its dividend, and a weak outlook. Berkshire Hathaway owns 26.7% of Kraft Heinz. I was quoted in The New York Times and Bloomberg on this […]
SEMBCORP Industries on Friday said it is working together with YCH Group on supplying its warehouses across Asia with solar power, as it announced the completion of a rooftop solar farm at YCH's Supply Chain City flagship building.
OCBC is offering its mobile payment service on food ordering app Waitrr. The OCBC Pay Anyone app enables customers to make direct QR code payments to merchants, and peer-to-peer e-payments leveraging QR codes, social media, or a recipient's mobile number and PayNow.
SINGAPORE Exchange has queried property developer Hong Fok over "unusual price movements" in its shares recently. The regulator did not spell out the period in question nor the magnitude of the price change. The firm's share price was up about 6.42 per cent on Friday morning.
TEST-HANDLING machine supplier AEM Holdings on Thursday night said it has received sales orders worth S$174 million as at March 21 for delivery in fiscal year 2019. This is up from the S$140 million in sales orders previously announced in February.