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Old 06-09-2017, 04:29 PM   #2226
Malachii
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Re: Value Investing and Longer Term Investing

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Originally Posted by calmasahinducow View Post
It has to do with technological/security maturity. Lots of companies/government entities are not monitoring traffic properly due to difficulty, skills gaps, etc. This area will continue to grow just due to how immature it is.

Those that are already monitoring will transition to taps from span solutions due to ease and better performance.

I don't want to go too deep down the technical rabbit hole but that's the four sentence gist of it.
Gotcha. Are you familiar with Cisco's Stealthwatch? Any thoughts on how that technology compares vis a vis what Gigamon brings to the table? Just trying to evaluate how likely Cisco would be to acquire them. I think the deal would make a lot of sense for them if this technology adds something that they don't already have internally, but if Stealthwatch is just as good then maybe not so much. Thoughts?
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Old 06-09-2017, 09:45 PM   #2227
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Re: Value Investing and Longer Term Investing

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Originally Posted by Malachii View Post
Gotcha. Are you familiar with Cisco's Stealthwatch? Any thoughts on how that technology compares vis a vis what Gigamon brings to the table? Just trying to evaluate how likely Cisco would be to acquire them. I think the deal would make a lot of sense for them if this technology adds something that they don't already have internally, but if Stealthwatch is just as good then maybe not so much. Thoughts?
Stealthwatch is the flow portion of a SIEM; it's software. A Gigamon device (hardware) would feed traffic for Stealthwatch to do analysis on. It's exactly the sort of thing that would lend itself for vertical integration for Cisco.

The latest rumors are that HP is interested. Presumably, they would offer a bundled package along with its ArcSight appliances/software.
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Old 06-12-2017, 11:02 PM   #2228
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Re: Value Investing and Longer Term Investing

What is your opinion of Robotics & Artificial Intelligence ETF (https://www.globalxfunds.com/funds/botz/) (https://www.google.com/finance?q=BOTZ) Is this a no-brainer long-term investment?
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Old 06-13-2017, 07:39 AM   #2229
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Re: Value Investing and Longer Term Investing

I sold out my officedepo
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Old 06-13-2017, 03:15 PM   #2230
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Re: Value Investing and Longer Term Investing

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What is your opinion of Robotics & Artificial Intelligence ETF (https://www.globalxfunds.com/funds/botz/) (https://www.google.com/finance?q=BOTZ) Is this a no-brainer long-term investment?
This ETF has a .68% expense ratio and 29 holdings. I can't understand why anyone would pay someone that much just to hold 29 different stocks for them. You could just buy the top 10 holdings and that would give you 65% of this ETF.
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Old 06-13-2017, 06:14 PM   #2231
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Re: Value Investing and Longer Term Investing

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This ETF has a .68% expense ratio and 29 holdings. I can't understand why anyone would pay someone that much just to hold 29 different stocks for them. You could just buy the top 10 holdings and that would give you 65% of this ETF.
Guess position size matters. My round trip on an ETF is $4.95. I think I'd need to own $15,000 of BOTZ before the expense ratio came to the same as the typical basket of 10 stocks (and that doesn't count rebalancing). So yeah over a certain position size I suppose it makes sense. It also requires you to do the right thing with those 10 holdings (the ETF is rebalancing for you after all)
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Old 06-14-2017, 01:12 AM   #2232
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Re: Value Investing and Longer Term Investing

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Originally Posted by AALegend View Post
What is your opinion of Robotics & Artificial Intelligence ETF (https://www.globalxfunds.com/funds/botz/) (https://www.google.com/finance?q=BOTZ) Is this a no-brainer long-term investment?
If equivalent ETFs were available during the rise of automobiles (or airplanes or computers) how well would it have done given that most players went bankrupt?
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Old 06-14-2017, 08:00 PM   #2233
Malachii
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Re: Value Investing and Longer Term Investing

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Originally Posted by calmasahinducow View Post
Stealthwatch is the flow portion of a SIEM; it's software. A Gigamon device (hardware) would feed traffic for Stealthwatch to do analysis on. It's exactly the sort of thing that would lend itself for vertical integration for Cisco.

The latest rumors are that HP is interested. Presumably, they would offer a bundled package along with its ArcSight appliances/software.
Thanks, that wasn't entirely clear from reading Cisco's webpage and like I said, I'm a complete layman in the area.

One more follow up question. I just saw this:http://crweworld.com/newsroom/prnews...9&filter=10284

I would think that having a traffic visibility solution that works directly with Amazon Web Services would be huge. Are there any other competitors with similar technology that you're aware of?
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Old 06-15-2017, 02:26 PM   #2234
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Re: Value Investing and Longer Term Investing

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If equivalent ETFs were available during the rise of automobiles (or airplanes or computers) how well would it have done given that most players went bankrupt?
But you could have made bank if you sold out before the bubble collapsed.
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Old 06-16-2017, 01:08 PM   #2235
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Re: Value Investing and Longer Term Investing

NVTR at $13 just BEASTING

Only have 1/3 position left and have remorse!
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Old 06-19-2017, 08:57 PM   #2236
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Re: Value Investing and Longer Term Investing

Just came to post about it. Still have my whole position, but starting to consider getting out. What exit points do people here have (if anyone else owns it)?
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Old 06-19-2017, 09:14 PM   #2237
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Re: Value Investing and Longer Term Investing

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Thanks, that wasn't entirely clear from reading Cisco's webpage and like I said, I'm a complete layman in the area.

One more follow up question. I just saw this:http://crweworld.com/newsroom/prnews...9&filter=10284

I would think that having a traffic visibility solution that works directly with Amazon Web Services would be huge. Are there any other competitors with similar technology that you're aware of?
The physical infrastructure behind AWS is just a large data center and traffic still needs to be monitored for security and metrics. There's nothing inherently special about working with AWS in this case, just marketing . That being said, all the cloud service providers provide or will provide monitoring/security solutions just as AWS already provides a Web Application Firewall Service on demand (not to mention their Palo Alto images on demand).

Other competitors in the space are Netscout (product is not as mature) and Ixia, who acquired NetOptics and was itself acquired by Keysight recently. My company testdrove all three and found Gigamon to be the best solution (this was a couple years ago).
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Old 06-29-2017, 05:44 PM   #2238
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Re: Value Investing and Longer Term Investing

lol PIRS up 350% since I brought it up here. I sold too soon

NVTR almost at $14 is amazing. We were talk when it was $5 in here
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Old 06-30-2017, 07:18 AM   #2239
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Re: Value Investing and Longer Term Investing

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Originally Posted by ibavly View Post
Just came to post about it. Still have my whole position, but starting to consider getting out. What exit points do people here have (if anyone else owns it)?
Low 20s i'd start considering selling some.
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Old 07-01-2017, 12:52 AM   #2240
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Re: Value Investing and Longer Term Investing

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lol PIRS up 350% since I brought it up here. I sold too soon

NVTR almost at $14 is amazing. We were talk when it was $5 in here
See investment factors.
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Old 07-05-2017, 10:42 PM   #2241
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Re: Value Investing and Longer Term Investing

Anyone else in the Japanese net-net game? There are a bunch of them, so I looked for ones with solid earnings too. Pretty simplistic, but probably about the best I can do without speaking a word of Japanese. Here's what I ended up buying:

1736 (OTEC) - 83% of NCAV
1758 (Taiyo) - 86% of NCAV
4624 (Isamu) - 66% of NCAV
4627 (Natoco) - 92% of NCAV
5357 (Yotai) - 68% of NCAV
6637 (Terasaki) - 55% of NCAV
7399 (Nansin) - 82% of NCAV
7435 (Nadex) - 94% of NCAV
7472 (Toba) - 95% of NCAV
7591 (Excel Co) - 67% of NCAV
7877 (Eidai Kako) - 67% of NCAV
8144 (Denkyosha) - 54% of NCAV
9955 (Yonkyu) - 85% of NCAV

Edit: Denkyosha seems to be the only one that has been buying back shares, so if I had to pick just one that would be it.

Last edited by n00b590; 07-05-2017 at 11:01 PM.
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Old 07-06-2017, 02:37 AM   #2242
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Re: Value Investing and Longer Term Investing

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Originally Posted by n00b590 View Post
Anyone else in the Japanese net-net game? There are a bunch of them, so I looked for ones with solid earnings too. Pretty simplistic, but probably about the best I can do without speaking a word of Japanese. Here's what I ended up buying:

1736 (OTEC) - 83% of NCAV
1758 (Taiyo) - 86% of NCAV
4624 (Isamu) - 66% of NCAV
4627 (Natoco) - 92% of NCAV
5357 (Yotai) - 68% of NCAV
6637 (Terasaki) - 55% of NCAV
7399 (Nansin) - 82% of NCAV
7435 (Nadex) - 94% of NCAV
7472 (Toba) - 95% of NCAV
7591 (Excel Co) - 67% of NCAV
7877 (Eidai Kako) - 67% of NCAV
8144 (Denkyosha) - 54% of NCAV
9955 (Yonkyu) - 85% of NCAV

Edit: Denkyosha seems to be the only one that has been buying back shares, so if I had to pick just one that would be it.
The problem is that quite a large number of Japanese companies just hoard cash like they're keeping score and sit on it like a dragon on a pile of gold, doing absolutely nothing with it.

Unless there's a severe reason why they should be valued at book like NTT, they don't tend to get anywhere close to book.
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Old 07-06-2017, 03:39 AM   #2243
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Re: Value Investing and Longer Term Investing

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Originally Posted by Mori****a System View Post
The problem is that quite a large number of Japanese companies just hoard cash like they're keeping score and sit on it like a dragon on a pile of gold, doing absolutely nothing with it.

Unless there's a severe reason why they should be valued at book like NTT, they don't tend to get anywhere close to book.
Right, all the cash hoarding is why they have these big discounts I'm sure. But that also makes them attractive takeover targets, and means the downside risk should be rather limited. So shouldn't this portfolio grind out a lowish-variance ~7% baseline return (based on 10% earnings yield with a 30% discount on retained earnings) with the occasional 50-100% bink from a buyout? Seems like a pretty favorable risk/reward.

And FWIW the average P/B ratio for Japan is right around 1.0 according to the few sources I found, although lower for small/micro caps like these.
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Old 07-06-2017, 03:41 PM   #2244
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Re: Value Investing and Longer Term Investing

Should be a fine strategy. Would be best if you can find the few that are actually buying back significant % of shares. So far private equity has been less active in Japan in acquiring companies with large cash balance sheets, could be because founders often have large % of shares and aren't willing to sell
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Old 07-06-2017, 07:40 PM   #2245
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Re: Value Investing and Longer Term Investing

Yeah, if you can find the ones that are buying back shares in droves and care about shareholder valuation, then those are great to hold. However, I prefer something that has an ADR in the US, because holding yen and paying fees to participate in a rather illiquid market (for example, look at avg vol for denkyosha) is not a very fun thing to do.

On a different subject, this may be rather stupid, but what is wrong with buying RAD?

After going through the RAD deal, I end up with this situation:

WBA paid 2.4m per store in the deal. RAD has ~2400 stores left that management says is as good or better than the stores going to WBA. Assuming that the valuation is the same, that's a 5.8b valuation.

WBA is paying 5.5b to RAD, which along with their present cash is 5.7b.

Their remaining assets are the envision purchase in 2015 for 2b. Assuming it holds the 2b valuation, you have a valuation of 13.5b.

Take away the 7.2b in debt and you have 6.3b in shareholder equity, which is roughly $6 a share. Even in a terrible case scenario where we write off envision completely, that's still $4 a share in shareholder equity.

Obviously this is going to be horrible in the short term, but based on the above what stops it from reverting back to the mean before the merger announcement, say $5-$6 a share?

Last edited by Morishita System; 07-06-2017 at 07:45 PM.
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Old 07-08-2017, 10:08 AM   #2246
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Re: Value Investing and Longer Term Investing

I have done well following Cornwall capital. They have had quite a success with their activist investing in Japan. They are the same guys from big short book. If you see a net net with cornwall in the shareholder list on FT website, please tell me! They have been successful either pushing large buybacks or getting company sold.

Here is my list of Japan Net nets:
http://treasureinvesting.blogspot.co...-is-about.html

I observed about 80 cheap Japanese stocks in the past year, and generally they move when buybacks happen or earnings increase. I think it is better to bet on a good business with 50% net cash, than a crappy one with 100% net cash. The market heavily discounts cash in general unless they do special dividends or something, which is rare.

For example IFIS japan has a really nice business with high margins and very high ROIC (excluding excess cash), traded at <10x PE. 50% market cap net cash. They have a record of making cheap acquisitions. And after they increased earnings this year they jumped like 70%. Most of these net nets have awful ROIC (even excluding excess cash) and tiny margins, so they will never get a high PE. Unless they get sold or something.

Last edited by dfgg; 07-08-2017 at 10:23 AM.
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Old 07-08-2017, 12:48 PM   #2247
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Re: Value Investing and Longer Term Investing

Oh nice I actually came across your blog when I was researching these haha, didn't realize it was a 2+2er's. I like most of those too, but I think your 30% expected IRR is vastly over-optimistic. Net cash = cash minus liabilties, not just cash per share. So net cash for Tokyo Kisen, for example, is 60% of market cap -- not 170%.
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Old 07-08-2017, 02:38 PM   #2248
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Re: Value Investing and Longer Term Investing

market cap is 7b. I guess if you subtract share of subsidiaries, then cash is about 130% per share. How do you get only 60%? I count securities and long term deposits as well. How do you count gain on sale of property plant and equipment? Since that is a sizable part of profit. that seems to be a recurring thing as well.

https://www.kaijinet.com/jpExpress/D...tement&cc=9193
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Old 07-10-2017, 04:51 AM   #2249
leavesofliberty
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Re: Value Investing and Longer Term Investing

Anyone thinking WalMart? It went down after Amazon's news of Whole Foods, but fundamentally sound company.
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Old 07-11-2017, 09:54 AM   #2250
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Re: Value Investing and Longer Term Investing

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Anyone thinking WalMart? It went down after Amazon's news of Whole Foods, but fundamentally sound company.
Buying Costco instead, which has also dropped significantly since the Whole Foods announcement.
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