Author Topic: What are you buying today?  (Read 2206435 times)

nodnub

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Re: What are you buying today?
« Reply #780 on: October 16, 2014, 02:00:22 PM »
bought some Mastercard and Visa

Hi. If I can ask, how do you think about valuation, especially for MA?

I own MA, and have owned since a month or two after the IPO.  This is one of my few 'moat' companies.  I am just holding on tight.  Valuation might be stretched now, but if you think out 10 years the world will be increasingly digital vs cash based.  MA is going to benefit from this.

I prefer MA over V because MA includes Europe whereas Visa does not.  Is this an incredible value play, maybe not here, but I think I'll be happy in 5-10 years verses where shares are at now.

What do you mean by this? I think I misunderstand you as my credit card is from Visa. We have both here?


VISA Europe is separate from VISA.  VISA Europe is owned by financial member institutions not public shareholders.
http://usa.visa.com/about-visa/our-business/visa-inc-and-europe.jsp


tombgrt

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Re: What are you buying today?
« Reply #781 on: October 16, 2014, 02:50:57 PM »
Ha I had no idea, thx!

Rainforesthiker

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Re: What are you buying today?
« Reply #782 on: October 16, 2014, 03:00:07 PM »
bought some Mastercard and Visa

Hi. If I can ask, how do you think about valuation, especially for MA?

For MasterCard and Visa I think more in qualitative terms wrt valuation.  They are a very strong duopoly, essentially they receive a royalty on worldwide digital commerce, or act as a tollbooth on worldwide consumption.  I don't have the numbers in front of me, but something like 80% of the world's transactions are still cash or check.  Those will continue to move to electronic over time, and thus these companies have a long runway of growth.  V and MA do not issue cards or extend credit ( unlike AmEx and Discover), they just collect a small piece of each transaction.  They generate lots of cash and have been buying back lots of stock.  I just think here are great businesses to own for a long time.
The key question:  What is the "inefficient rationale" - the reason the market is mispricing the stock.  Why doesn't the powerful force of the wisdom of the crowd manifest here to produce the correct price?

Rainforesthiker

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Re: What are you buying today?
« Reply #783 on: October 16, 2014, 03:05:19 PM »
bought some Mastercard and Visa

Hi. If I can ask, how do you think about valuation, especially for MA?

I own MA, and have owned since a month or two after the IPO.  This is one of my few 'moat' companies.  I am just holding on tight.  Valuation might be stretched now, but if you think out 10 years the world will be increasingly digital vs cash based.  MA is going to benefit from this.

I prefer MA over V because MA includes Europe whereas Visa does not.  Is this an incredible value play, maybe not here, but I think I'll be happy in 5-10 years verses where shares are at now.

What do you mean by this? I think I misunderstand you as my credit card is from Visa. We have both here?


VISA Europe is separate from VISA.  VISA Europe is owned by financial member institutions not public shareholders.
http://usa.visa.com/about-visa/our-business/visa-inc-and-europe.jsp


A very smart value investor made the case to me that Visa should be preferred over MasterCard as an nvestment because it does not yet own Europe, and is priced accordingly, but he believes it eventually will.  Time will tell.
The key question:  What is the "inefficient rationale" - the reason the market is mispricing the stock.  Why doesn't the powerful force of the wisdom of the crowd manifest here to produce the correct price?

Liberty

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Re: What are you buying today?
« Reply #784 on: October 16, 2014, 03:50:03 PM »
bought some Mastercard and Visa

Hi. If I can ask, how do you think about valuation, especially for MA?

For MasterCard and Visa I think more in qualitative terms wrt valuation.  They are a very strong duopoly, essentially they receive a royalty on worldwide digital commerce, or act as a tollbooth on worldwide consumption.  I don't have the numbers in front of me, but something like 80% of the world's transactions are still cash or check.  Those will continue to move to electronic over time, and thus these companies have a long runway of growth.  V and MA do not issue cards or extend credit ( unlike AmEx and Discover), they just collect a small piece of each transaction.  They generate lots of cash and have been buying back lots of stock.  I just think here are great businesses to own for a long time.

Thanks, I looked at them a while ago and basically came to the same qualitative conclusions. I was just curious to know if there's a certain FCF multiple or something like that you'd be buying at or under..

bargainman

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Re: What are you buying today?
« Reply #785 on: October 16, 2014, 04:20:12 PM »
I have been buying and now its my 2nd largest position TAXI. Very strong buy at these levels IMO.

Top positions (BAC, TAXI, AAPL, C, AIG)

what is your thesis on taxi?

Lance

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Re: What are you buying today?
« Reply #786 on: October 16, 2014, 06:03:55 PM »
Interesting idea, Lance.  I suspect you bought due to discount to NAV which is presumably related to Gross' departure (even though Gross was not the manager of this fund).  But, aside from the discount, how do you feel about the prospects for the fund itself and future NAV growth?  As I understand it, the current PDI holdings are basically a leveraged portfolio of non-agency (low credit quality) mortgages. 

I note that Gross himself was buying as recently as Aug 21 @ $32.76.

Thanks.

 

PDI - PIMCO Dynamic Income Fund.

Thanks,
Lance

BRK7 - yeah, pretty much.  I figured the Pimco selling was overdone.  Along those lines I also bought Allianz (AZSEY) and one of the Allianz convertible bond funds (NCV) during the sell-off on Wednesday.  As far as the prospects for PDI, I'm guessing that interest rates stay low (and may head lower), thus it should do well.  I don't really have a feel for future NAV growth, but was really just looking for something cheap and levered.  I believe you're correct about the holdings.

Thanks,
Lance

jay21

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Re: What are you buying today?
« Reply #787 on: October 17, 2014, 06:09:33 AM »
Interesting idea, Lance.  I suspect you bought due to discount to NAV which is presumably related to Gross' departure (even though Gross was not the manager of this fund).  But, aside from the discount, how do you feel about the prospects for the fund itself and future NAV growth?  As I understand it, the current PDI holdings are basically a leveraged portfolio of non-agency (low credit quality) mortgages. 

I note that Gross himself was buying as recently as Aug 21 @ $32.76.

Thanks.


PDI - PIMCO Dynamic Income Fund.

Thanks,
Lance

I think non-agencies is one place where you can still get decent carry, and if it's a good manager than capital appreciation too.
@jay_21_

Hawks

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Re: What are you buying today?
« Reply #788 on: October 20, 2014, 10:36:57 AM »
CNQ and XOM

PatientCheetah

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Re: What are you buying today?
« Reply #789 on: October 20, 2014, 08:14:48 PM »
NBR and NFX, many energy names are on sales, missed the sharp rally on EOG
risk as little as possible until all the stars have aligned

Longer Term: FB MSFT BABA JD YRD