Author Topic: What are you buying today?  (Read 1342639 times)

Broeb22

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Re: What are you buying today?
« Reply #4080 on: August 13, 2019, 05:50:56 PM »
CVET

Another “crappola” spin-off. What is the thesis now, since the initial thesis of a software subscription business seems to busted? Or is this thesis still intact in your opinion?

Was the thesis ever that this was a software subscription business? Maybe your opinion of CVET is shared by others, which makes my thesis more plausible that the business fundamentals will be strong for a long time while being hard to understand in the present, and potentially a source of excess returns. But that's what makes a market.


Spekulatius

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Re: What are you buying today?
« Reply #4081 on: August 13, 2019, 06:41:37 PM »
CVET

Another “crappola” spin-off. What is the thesis now, since the initial thesis of a software subscription business seems to busted? Or is this thesis still intact in your opinion?

Was the thesis ever that this was a software subscription business? Maybe your opinion of CVET is shared by others, which makes my thesis more plausible that the business fundamentals will be strong for a long time while being hard to understand in the present, and potentially a source of excess returns. But that's what makes a market.

Yes, I believe that was the thesis. But this software business is small and the company is loaded with debt. early indication are that the business doesn’t generate much cash. If you are just interested in the distribution business, you can buy PDCO, which although it is not a pure play on animal health, trades at a very undemanding valuation.
To be a realist, one has to believe in miracles.

Gregmal

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Re: What are you buying today?
« Reply #4082 on: August 14, 2019, 07:21:09 AM »
added to MSGN in reasonable size @17.5

Broeb22

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Re: What are you buying today?
« Reply #4083 on: August 14, 2019, 08:04:44 AM »
Based on my analysis, which I am quite certain you won't rely on, CVET offers a superior value proposition to its customers, vets. It does so by offering lower inventory carrying costs and bringing the vet practice incremental sales they otherwise would not earn. Vets currently charge exorbitant prices for their prescriptions because much of the inventory moves slow at the individual practice level, but a company like CVET can aggregate the demand of its vets, generate better inventory turns at lower gross margins, and still earn a respectable ROE. The lower gross margin CVET can charge relative to the individual practice is what drives the sales boost for the vet practice.

The prescription mgmt. side of CVET is more than anything a means to drive higher sales from the distribution business. The existing distribution business and its sales reps should also drive the adoption of CVET's prescription mgmt. business internationally, which the company is building its capabilities for right now.

Yes, the debt is very high. That is an admitted risk for a small position, and one I offset at the portfolio level with a decent amount of cash. 

I guess when you boil it down, I believe CVET will earn above-market growth due to the better value prop outlined above, will get some additional gravy from their software-type business, and they operate in a market that grows above inflation with a multi-decade record of doing so. 

CorpRaider

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Re: What are you buying today?
« Reply #4084 on: August 14, 2019, 08:41:52 AM »
Had an outstanding limit order fill on $TPR...kind of conflicted about that, but that's probably why I let system 2 put the order in some time ago.   :'(

james22

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Re: What are you buying today?
« Reply #4085 on: August 14, 2019, 12:05:43 PM »
More BRK @ $196.37.
25% BRK l 25% BAM l 8% SV (VSIAX) l 8% EM (VEMAX) l 4% FNMA/FMCC l 4% FNMAS/FMCKJ l 25% Stable Value

Viking

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Re: What are you buying today?
« Reply #4086 on: August 14, 2019, 12:21:04 PM »
BAC, MS, LUV, SU.TO, FFH, WFT.TO

Still about 70% cash

Agrippa07

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Re: What are you buying today?
« Reply #4087 on: August 14, 2019, 01:00:01 PM »
added to BRK.B, MO and WFC

Spekulatius

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Re: What are you buying today?
« Reply #4088 on: August 14, 2019, 03:03:41 PM »
GRIF

Same here. Got some GRIF at the close. Also added to FOX, BNTGY, WMB,WAB and a starter in DD (rebought).
To be a realist, one has to believe in miracles.

Mephistopheles

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Re: What are you buying today?
« Reply #4089 on: August 14, 2019, 03:18:15 PM »
M - Macy’s. I think 3 of their prime properties - Herald Square NY, State Street Chicago and Union Square SF are worth like half the EV of the entire company ($9 b as of today)