Sardar Biglari, once a darling of value investors for his Buffett like annual letters and communications with shareholders has lost much of his luster due to a compensation package proposal that was much unBuffett like.
I’ve followed Biglari since I first came across some of his Lion Fund shareholder letters on the internet in 2006. I also wrote about Biglari holdings in July suggesting the stock price was interesting around $280. It has since popped back up to $325 which is unfortunate because I was hoping to get even better purchase prices. Here was my prior article:
http://www.gurufocus.com/news.php?id=100474
There is a video from the opening of a new Steak N Shake franchise which is linked below. In it Sardar refers to the potential to open 1,000 such franchise units. Many Biglari Holdings investors have invested based on the premise that the core Steak N Shake business will simply be milked for cash to invest elsewhere. It is clear that Biglari is also focused on growing the cash flow from this existing business through franchising.
The combination of growing free cash flow from Steak N Shake and Biglari investing it at high rates of return could be an exceptionally rewarding combination. I wasn’t thrilled with the compensation plan myself, but I still think Mr. Biglari is one sharp cookie.
Here is the video with Sardar: http://romenews-tribune.com/view/full_story/9618760/article-Steak--n-Shake--Open-for-business
I’ve followed Biglari since I first came across some of his Lion Fund shareholder letters on the internet in 2006. I also wrote about Biglari holdings in July suggesting the stock price was interesting around $280. It has since popped back up to $325 which is unfortunate because I was hoping to get even better purchase prices. Here was my prior article:
http://www.gurufocus.com/news.php?id=100474
There is a video from the opening of a new Steak N Shake franchise which is linked below. In it Sardar refers to the potential to open 1,000 such franchise units. Many Biglari Holdings investors have invested based on the premise that the core Steak N Shake business will simply be milked for cash to invest elsewhere. It is clear that Biglari is also focused on growing the cash flow from this existing business through franchising.
The combination of growing free cash flow from Steak N Shake and Biglari investing it at high rates of return could be an exceptionally rewarding combination. I wasn’t thrilled with the compensation plan myself, but I still think Mr. Biglari is one sharp cookie.
Here is the video with Sardar: http://romenews-tribune.com/view/full_story/9618760/article-Steak--n-Shake--Open-for-business
