Author Topic: LUK - Leucadia  (Read 455925 times)

petec

  • Hero Member
  • *****
  • Posts: 1291
Re: LUK - Leucadia
« Reply #1160 on: February 05, 2018, 05:35:09 AM »
FYI today's Barron's are pushing LUK as mini-Berk with some SOP valuation.

Disclosure: No position, no interest.

Haven't seen the article but my (pretty basic) SOP today is $25/share with decent optionality in several of the units. They need a period of volatility to do some good deals.


Liberty

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 9643
  • twitter.com/libertyRPF
    • twitter.com/libertyRPF
"Most haystacks don't even have a needle." |  I'm on Twitter  | Watch this, please (new link)


LowIQinvestor

  • Hero Member
  • *****
  • Posts: 524
Re: LUK - Leucadia
« Reply #1163 on: February 09, 2018, 07:57:42 AM »
The sale of National Beef should significantly juice reported book value.

LUK is carrying Beef at around $700M (BV) & the co did $500M in EBITDA.

LUK owns 79% of National Beef.

I think a sale is on the horizon.

Buying LUK today

LowIQinvestor

  • Hero Member
  • *****
  • Posts: 524
Re: LUK - Leucadia
« Reply #1164 on: February 13, 2018, 11:18:56 AM »
Allan Mecham - Arlington Value Capital 's 4th largest position is LUK
( right behind IBKR, BRKB, & CMPR)
http://www.dataroma.com/m/holdings.php?m=AV

Spekulatius

  • Hero Member
  • *****
  • Posts: 1129
Re: LUK - Leucadia
« Reply #1165 on: February 13, 2018, 03:23:24 PM »
The sale of National Beef should significantly juice reported book value.

LUK is carrying Beef at around $700M (BV) & the co did $500M in EBITDA.

LUK owns 79% of National Beef.

I think a sale is on the horizon.

Buying LUK today

But they also have $450-500M charge from deferred tax asset revaluation pending that is going to hit the book value.
To be a realist, one has to believe in miracles.

VersaillesinNY

  • Sr. Member
  • ****
  • Posts: 264
Re: LUK - Leucadia
« Reply #1166 on: February 26, 2018, 03:07:03 AM »
LUK letter 2017

https://www.leucadia.com/CMSFiles/Leucadia.com/files/c-p_letters/leucadia_2017_shareholders_letter.pdf

Quote
You should sit on a porch, watch the world go by and then if you see something succulent, jump on it.
Ian Cumming
« Last Edit: February 26, 2018, 03:09:31 AM by VersaillesinNY »

scorpioncapital

  • Lifetime Member
  • Hero Member
  • *****
  • Posts: 1469
    • scorpion capital
Re: LUK - Leucadia
« Reply #1167 on: February 26, 2018, 03:24:51 AM »
LUk is a tricky beast. I read their letters. They use honey words. But their record is atrocious and has resulted in the burning of one's capital. I moved out of LUK almost 10 years ago and cannot ignore that the stock has gone nowhere - if not down, while my new portfolio (including a big chunk of Berkshire) is up over 100%.
I suspect the problem is a disconnect between good intentions but too much of a speculative streak, a bet on inflation, and investing in low quality cyclical businesses or businesses with 'headaches' such as investment banking. Still...their stubborn one-way bet on inflation - a kind of broken clock is right twice - may pay off shortly but missing such a long accumulation of value in stocks is expensive since even if stocks go down by half, they will still be above the purchase price of an investor who bought in a decade ago.
However it is really tempting to perhaps switch into LUK right about now, not because management is good or isn't going to make any more blunders, just the assets they hold have a tailwind :) However I always wonder if management is a liability which is going to make some freak stupid investment.






mcliu

  • Hero Member
  • *****
  • Posts: 502
Re: LUK - Leucadia
« Reply #1168 on: February 26, 2018, 12:30:38 PM »
Is that what they're good at though? Judging from their history, the founders seem to have a talent for acquiring assets that make no sense at the time, but are extremely valuable 5 or 10 years later.. It seems like they're moving away from this model of betting on home-runs and opportunistically buying/selling to actually operating companies for the long-run.. In which case, you might see more steady increases in BV compared to the past..

petec

  • Hero Member
  • *****
  • Posts: 1291
Re: LUK - Leucadia
« Reply #1169 on: March 05, 2018, 10:41:29 AM »
LUk is a tricky beast. I read their letters. They use honey words. But their record is atrocious and has resulted in the burning of one's capital. I moved out of LUK almost 10 years ago and cannot ignore that the stock has gone nowhere - if not down, while my new portfolio (including a big chunk of Berkshire) is up over 100%.
I suspect the problem is a disconnect between good intentions but too much of a speculative streak, a bet on inflation, and investing in low quality cyclical businesses or businesses with 'headaches' such as investment banking. Still...their stubborn one-way bet on inflation - a kind of broken clock is right twice - may pay off shortly but missing such a long accumulation of value in stocks is expensive since even if stocks go down by half, they will still be above the purchase price of an investor who bought in a decade ago.
However it is really tempting to perhaps switch into LUK right about now, not because management is good or isn't going to make any more blunders, just the assets they hold have a tailwind :) However I always wonder if management is a liability which is going to make some freak stupid investment.

10 years ago this was trading on a tbv of 2x based on a brilliant track record. That's seldom a recipe for share price performance because all investment managers go through fallow patches.

Both management teams had superb records in the individual entities. That doesn't mean every decision was good but multidecade bvps growth says something.

Of course, pretty much every bit of the business was hugely challenged over the last 10 years. So management suddenly looked stupid and the shares derated. But in the background, management transformed the company. JEF isn't spectacular but it is generating reasonable profits and comes at a reasonable price. LAM is very early days but might (might)become the second anchor business - nice option if you don't have to pay for it. The portfolio is very different from what this management team were handed on day 1, and every major business in it is heading the right way and/or is being turned into cash. So is the NOL - remember how they were never going to earn enough profits to use it? Jefferies and National Beef would now beg to differ.

Given the dealflow they see at Jefferies, cash could be a very valuable asset. 

I kinda like it.