Author Topic: LILA - Liberty Global Latin America tracker  (Read 98872 times)

Spekulatius

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Re: LILA - Liberty Global Latin America tracker
« Reply #160 on: September 03, 2016, 08:34:13 AM »
Almost 300-slide presentation on LiLAC:

http://valueseekerinvestments.blogspot.com/2016/09/lilac-lilabk-liberty-latam-287-slides.html

Follow him on Twitter: @find_me_value

I always get question marks when i see so much stuff to defend an investment, shouldn`t a compelling investment be easy to describe?
While i don`t think that LILA is expensive here, i really wonder why Malone hasn`t bought one share in the open market until now when this is such a compelling opportunity? When i see how much he is selling of his other holdings, he should have plenty of cash.
Maybe it isn`t the opportunity of the year at an EV/EBITDA of 8 or 9. At a very cheap multiple of 5x2017 EBITDA it would trade down to 7$, at 6x it trades down to 14$. (And yes even LBTYA traded down to that level once in the past decade).

9x EBITDA is not cheap for LILA. For one thing, their cost of debt is much higher than for similar assets in the USA or Europe, because the interest rates in local currencies are much higher. Sure, LILA's debt is mostly USD, but that means that they need to by swaps to protect against currency drops. Some of LILA's markets are very competitive as well (Chile, Puerto Rico). I don't see the bargain here, but if it does trade down for <7x EV/EBITDA, I would take a sharp look.
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Munger_Disciple

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Re: LILA - Liberty Global Latin America tracker
« Reply #161 on: September 03, 2016, 10:56:59 AM »
I find the 300 slide presentation strange. Very long, unorganized, repetitive and almost no discussion on why the current valuation is cheap.

giofranchi

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Re: LILA - Liberty Global Latin America tracker
« Reply #162 on: September 03, 2016, 11:40:23 AM »
I think LILA/LILAK has lots of opportunities for profitable growth. But it also poses some risks that other cos in the "Malone family" don't run. I cannot be sure why it has sold off, and if the only reason might be a technical one.
Therefore, I have sold and used the proceeds to buy more LMCA. If the original thesis about LILA is still fine, there will be many chances to buy it in the future.

Cheers,

Gio
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Munger_Disciple

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Re: LILA - Liberty Global Latin America tracker
« Reply #163 on: September 03, 2016, 12:32:52 PM »
Quote
But it also poses some risks that other cos in the "Malone family" don't run.

Can you expand on these LILA specific risks that other Malone entities don't have?

giofranchi

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Re: LILA - Liberty Global Latin America tracker
« Reply #164 on: September 03, 2016, 02:37:31 PM »
Quote
But it also poses some risks that other cos in the "Malone family" don't run.

Can you expand on these LILA specific risks that other Malone entities don't have?

Basically those risks of investing in a region with little political stability.

Cheers,

Gio
Portfolio: AAPL, AMZN, BABA, BOSS, BRK.B, FB, FFH, FIH.U, FINX, FWONA, GOOG, IBB, JPM, LBRDA, MKL, NKE, QQQ, SFTBF, SMH, TCEHY, V, XBI, XT

Liberty

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Re: LILA - Liberty Global Latin America tracker
« Reply #165 on: September 03, 2016, 07:11:53 PM »
I find the 300 slide presentation strange. Very long, unorganized, repetitive and almost no discussion on why the current valuation is cheap.

This isn't a VIC long thesis. The author just wanted to do a deep dive on it to better understand the pieces and market dynamics, not necessarily trying to convince anyone to buy afaik.

But if you don't like it, I'm sure you can ask the author for a full refund.
« Last Edit: September 03, 2016, 07:23:10 PM by Liberty »
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maybe4less

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Re: LILA - Liberty Global Latin America tracker
« Reply #166 on: September 03, 2016, 07:13:09 PM »
Well I was the dope who rode TCI Satellite to zero when DTV and DISH where beating Malone with a club, so I don't think Malone is always right or wrong. Ad hominem arguments (eg Eddie Lampert must know what  he's doing) are the worst. If cable is so competitive, how come VTR surrendered 30 points of market share to satellite?  And what reason is there to think that trend won't continue?

Satellite has an advantage over cable as a video product, but not as a two-way broadband internet product. The relative importance to consumers of broadband vs. video is increasing.

Liberty

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Re: LILA - Liberty Global Latin America tracker
« Reply #167 on: September 03, 2016, 07:24:52 PM »
Well I was the dope who rode TCI Satellite to zero when DTV and DISH where beating Malone with a club, so I don't think Malone is always right or wrong. Ad hominem arguments (eg Eddie Lampert must know what  he's doing) are the worst. If cable is so competitive, how come VTR surrendered 30 points of market share to satellite?  And what reason is there to think that trend won't continue?

Satellite has an advantage over cable as a video product, but not as a two-way broadband internet product. The relative importance to consumers of broadband vs. video is increasing.

Even for video, satellite's advantage was bigger before cable started going all digital.
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muscleman

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Re: LILA - Liberty Global Latin America tracker
« Reply #168 on: September 03, 2016, 07:53:35 PM »
Well I was the dope who rode TCI Satellite to zero when DTV and DISH where beating Malone with a club, so I don't think Malone is always right or wrong. Ad hominem arguments (eg Eddie Lampert must know what  he's doing) are the worst. If cable is so competitive, how come VTR surrendered 30 points of market share to satellite?  And what reason is there to think that trend won't continue?

Satellite has an advantage over cable as a video product, but not as a two-way broadband internet product. The relative importance to consumers of broadband vs. video is increasing.

Even for video, satellite's advantage was bigger before cable started going all digital.

How does digital video close the satellite's advantage? Can you please elaborate?

Liberty

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Re: LILA - Liberty Global Latin America tracker
« Reply #169 on: September 04, 2016, 06:01:55 AM »
Well I was the dope who rode TCI Satellite to zero when DTV and DISH where beating Malone with a club, so I don't think Malone is always right or wrong. Ad hominem arguments (eg Eddie Lampert must know what  he's doing) are the worst. If cable is so competitive, how come VTR surrendered 30 points of market share to satellite?  And what reason is there to think that trend won't continue?

Satellite has an advantage over cable as a video product, but not as a two-way broadband internet product. The relative importance to consumers of broadband vs. video is increasing.

Even for video, satellite's advantage was bigger before cable started going all digital.

How does digital video close the satellite's advantage? Can you please elaborate?

For a while, satellite was all digital and carried tons of channels while cable was a mix of analog and digital channels, with the analog channels eating up a ton of bandwidth and restricting the total number of channels that could be carried. So it was a lower-quality offering that that couldn't carry as many channels.

Now that cable is going all digital, it can carry more channels that are all HD, and the removal of analog channels frees up a lot of space to take up broadband speeds up, which makes the overall offering more compelling.
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