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cdubey: I understand that the note give you better safety in case the company files for bankruptcy i.e., they come prior to equity holders, and offer you a coHi Chandan,
Thanks for your thoughts. If shares rise significantly by Jan 2016, common does provide more upside.
Cheers- Hi Chandan,
What is your preference of MTCN vs MT? The company is a tough business but I am willing to dig further to see if there may be a reasonable risk reward proposition here. - cdubey : A company which I am watching very closely. I have sold a Jan 2015 put at strike price $57.5 for $7.34. The reason is that my target buy price is $60. Thanks for sharing the thoughts. Yes makes sense. I really like the management and the fact that they grown the company using organic cashflow and clear the debt after acquisitions. I too am comfortable with a larger position at $50-$55 range (close to book value as well). I think once they don't see too many avenues for growth they ...
- Hi Chandan, What is your take on $65 for NOV today? They seem to have a wide moat business, reasonable financial strength and a backlog. Your thoughts appreciated.
Chandan, I've been reading the few articles you've written on Holcim, Ltd., and I've liked it enough that I have begun a full-blown analysis of its business (and needless to say, I'm impressed with Holcim's consistent and evolving levels of transparency!) I just want to ask you about your pie chart in the Feb 27 2012 article on the cement industry. The one containing cement production and cement capacity on a global scale. I've tried running a search on Google to find a statistical dat ...
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I repeat the lines (from you) which I completely agree with.
>Not trying to fight and I still agree the method is flawed. I agree with you in that: Not all management >that is shareholder friendly will produce above average results. Especially if the business or industry >are bad or in a phase of obsolescence. But if you find a company that has a durable moat in a good >industry, how management allocates capital will impact your investment return. And if they allocate it >by giving back to share holders as dividends or share repurchases when prices are low, that >generally will enhance your investment returns.
And add some more lines.
Being great at anything involves a lot of luck. It takes ability for sure -- but luck is pretty important too. The book underplays its contribution.
*Any* decision has a chance of looking wrong at the benefit of hindsight. And I mean *any*. Should you acquire, or not acquire a company. Should you pay debt or buyback stock. Should you pay dividend or not. Should you spinoff, sell for cash or sell for stock. Every one of these decisions may come back to bite you -- even if you made them correctly depending on the information you had at the time.
There are times when you make the wrong choice -- even when you had the necessary data to make the correct one. These are avoidable and might contribute positively to your performance.
But there are times that a decision which was correct soured because of changing conditions. If a CEO does not need to make these kind of decisions often -- he might be better off than the one who had to. Because sooner or later the luck turns.
It is true that the virtues extolled by the book may lead you to find good CEOs and better investment candidates -- and probably that is the major contribution. But there is no discussion on how the ability of the CEO is only part of the picture. And even a great CEO may fail if luck turns against him.