Author Topic: JEF - Jefferies Group  (Read 527725 times)

txlaw

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Re: JEF - Jefferies Group
« Reply #10 on: September 22, 2011, 11:41:38 AM »
Bought some LUK today.

Interesting to see that they bought a large slug of JEF stock from Richard Handler at a bargain basement price.  Don't think they can buy any more MLI, so it will be interesting to see if there's anything else they put money into. 

Regarding MLI, I believe there are two interesting angles to the story.  First, volumes of their goods have nowhere to go but up if we are at a bottom in housing starts.  Second, a collapse in copper prices due to China slowdown and a global commodities bubble bursting could boost the cost to price spreads on a unit basis so that gross margins go up quite nicely in the next few years (especially if MLI can buy up future copper production at collapsed prices). 

So I believe MLI is both a hedge against a bursting of the commodities bubble (something LUK must be well aware of, as they are intimately familiar with commodities like copper and iron ore) and a play on  housing starts being at the bottom.  Thoughts? 


tombgrt

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Re: JEF - Jefferies Group
« Reply #11 on: September 22, 2011, 02:16:31 PM »
-8,5%
-6,6%


I have work to do!  :o

greenwave

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Re: JEF - Jefferies Group
« Reply #12 on: September 22, 2011, 07:08:12 PM »
txlaw-
 
I think you are right on target with the reasons for luk's  large purchases of M L I . I would not be surprised if they eventually attempt to purchase M L I outright .

Although I don't post often , I always appreciate your commentary and insight on investing in general !

Thank you and all other contributors to this GREAT forum !

green wave

txlaw

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Re: JEF - Jefferies Group
« Reply #13 on: September 23, 2011, 07:40:03 AM »
txlaw-
 
I think you are right on target with the reasons for luk's  large purchases of M L I . I would not be surprised if they eventually attempt to purchase M L I outright .

Although I don't post often , I always appreciate your commentary and insight on investing in general !

Thank you and all other contributors to this GREAT forum !

green wave

Thanks, green wave.  I appreciate the props.

This board is great because people who don't invest for a living (like me) and even some of the professional guys out there are willing to share and bounce ideas off one another.

Even though I disagree with a lot of commentary on the board, especially about the macro, I also appreciate hearing the other viewpoints. 

Munger

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Re: JEF - Jefferies Group
« Reply #14 on: September 23, 2011, 12:10:21 PM »
Previous owner of LUK but no current position in LUK or JEF.

Will be very interesting to watch the JEF story unfold.  JEF management philosophy over the past few years can be summed up as -- "damn the torpedos, full steam ahead!"  No doubt gutsy but we'll probably learn if smart over the next 12 months, if not sooner. 

Just my opinion but the most recent conference call reminded a lot of the perfomance of some other excessively compensated management teams during 2008 (and we know how that turned out) -- analysts having trouble getting straight answers and reconciling the answers they did get with the question asked is never a good sign.

For those interested, replay is available -- note questions re:
1) sudden shrinking of the balance sheet at quarter end (four quarters in a row)
2) realized vs unrealized losses in the quarter (i.e., how much bad stuff is still on the books)
3) the health of their European business which they have dramatically increased in size
4) the massive ramp in dfd comp and the implications for future results
5) the surprising lack of any losses in the convert bond business during a period when the corresponding market got destroyed -- note JEF has one of the largest convert businesses on the street, according to analysts
6) the size of the company's direct exposure to European banks (the initial hesitation/stuttering was humorous).

I wish I personally had better insights because on the surface, management sounded like they were full of crap -- rarely answered any of the questions directly.  Plus I rarely short stocks (although that could change) -- put me in full agreement with the real Munger, who finds shorting stocks irritating.  So in the case of Jefferies, I have to settle for just grabbing the popcorn and watching this story unfold with great interest at this point.

Based on their apparent track record of success, I have respect for the LUK management team but I do find it odd they have gotten themselves knee deep with this company (a second tier IB without a stable source of financing like JPM, BAC, WFC?), unless their intention has long been to ultimately acquire JEF...so obviously the cheaper the better for LUK if they want to own this platform in entirety....
« Last Edit: September 23, 2011, 12:16:24 PM by Munger »

scorpioncapital

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Re: JEF - Jefferies Group
« Reply #15 on: September 23, 2011, 04:06:02 PM »
I've been adding to LUK at $23 and change, a decent price indeed at or slightly below book value. That should yield a return on investment in excess of 15%/yr. over time. As an aside, I just saw the movie Moneyball, watching this movie I could only thing of the comparison to Berkshire and Leucadia as the type of game that an investor *should* want to play, careful, methodical, seeing value in the discarded and unrecognized, with partners who know what they're doing, like each other, and are successful in understanding and playing the game. Those in this ballpark can be counted on 2 hands. Of those, only 2-3 are significantly superior to the other great value investors.

Poor Charlie

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Re: JEF - Jefferies Group
« Reply #16 on: September 24, 2011, 08:29:33 PM »
I've been looking for the LUK shareholder letters / annual reports from 1979-2003.  I was planning on contacting LUK Monday but thought I would check here first.  If any of you guys have the letters in PDF or link I would really appreciate it!!

whr981@gmail.com

bargainman

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Re: JEF - Jefferies Group
« Reply #17 on: September 24, 2011, 09:03:39 PM »
I've been looking for the LUK shareholder letters / annual reports from 1979-2003.  I was planning on contacting LUK Monday but thought I would check here first.  If any of you guys have the letters in PDF or link I would really appreciate it!!

whr981@gmail.com

You can get some of this on sec.gov..  Do a search on prior to 2004.  here's a link that should search for all 10-K's prior to 2004..  Doesn't go to 1979, but it gets you a few more at least...

http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000096223&type=10-K&dateb=20040101&owner=exclude&count=40


Poor Charlie

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Re: JEF - Jefferies Group
« Reply #18 on: September 24, 2011, 09:20:07 PM »
Thanks Bargainman.  I've checked out most all the sec filings.  I'm looking for the C&S shareholder letters which aren't on sec.gov...  Pretty sure they are available in PDF tho.

beerbaron

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Re: JEF - Jefferies Group
« Reply #19 on: September 25, 2011, 02:46:28 AM »
PM me with your e-mail address I'll send 1979 to2004.

BeerBaron