We like the wine business, having been attracted primarily due to vineyard acreage ownership at cheap prices. We have done well with pink sheet name Scheid Vineyards (SVIN) over the past couple of years.Very recently, we took a position in Australian winemaker Treasury Wine Estate, which received a buyout offer earlier this week from KKR. See more below.
http://www.thestreet.com/story/12715705/1/treasury-wine-rejects-kkrs-buyout-offer.html
*The author has positions in Scheid Vineyards and Treasury Wine Estates. This is neither a recommendation to buy or sell any securities. All information provided believed to be reliable and presented for information purposes only
Thursday, May 22, 2014
Tuesday, May 20, 2014
Number of Net/Nets at an All-Time Low-Purgatory For Value Investors
When we started this site back in 2003, it was primarily focused on stocks trading below net current asset value. Over the years, we've covered other areas of deep value, but it all started with net/nets. Interestingly, in the current environment, it would make no sense to start such a site, given the dearth of companies trading below net current asset value.
In fact, we've never so few in the umpteen years that we've been researching, writing about, and investing in net/nets.
To construct a third net/net index, in the footsteps of the Cheap Stocks 21 Net/Net Index which we unveiled in February of 2008 and the Cheap Stocks 26 Net/Net Index which we rolled out in September of 2011, would be extremely difficult at this writing.
In fact, we currently find just two companies with market caps in excess of $100 million that are trading below net current asset value, Richardson Electronics and Trans World Entertainment. Next in terms of market cap at $92.5 million is Gencor Industries. From there, its a mish mosh of smaller names, which may or may not deserve a deeper dive.
Suffice it to say that the net/net cupboard is bare. The reasons, in our view are the following:
1. A rising tide has lifted all boats. Rising markets have lifted many companies out of net/net territory, which is typical coming out of the upheaval we saw in 2008 and 2009. But even that does not tell the whole story.
2. There's also been a renewed interest in net/nets over the past several years. New buyers have entered the markets, bid up prices, and many net/nets don't stay there very long. New attention has been brought by websites and other resources that have alerted investors to the potential benefits of net/net investing. This website was one of the first. In essence, we've shot ourselves in the foot, and helped drive net/nets into extinction.
Not to worry though, a market correction will ultimately re-stock the net/net shelves at least temporarily. That's not something we wish for. In fact, despite the fact that many are calling for a correction following a five-year bull run, we don't believe the markets are extremely overvalued at this point. We are certainly struggling to find much that is interesting in terms of deep value, but don't believe there's a huge bubble. It's like purgatory for value investors.
*The author has a position in Richardson Electronics. This is neither a recommendation to buy or sell any securities. All information provided believed to be reliable and presented for information purposes only
In fact, we've never so few in the umpteen years that we've been researching, writing about, and investing in net/nets.
To construct a third net/net index, in the footsteps of the Cheap Stocks 21 Net/Net Index which we unveiled in February of 2008 and the Cheap Stocks 26 Net/Net Index which we rolled out in September of 2011, would be extremely difficult at this writing.
In fact, we currently find just two companies with market caps in excess of $100 million that are trading below net current asset value, Richardson Electronics and Trans World Entertainment. Next in terms of market cap at $92.5 million is Gencor Industries. From there, its a mish mosh of smaller names, which may or may not deserve a deeper dive.
Suffice it to say that the net/net cupboard is bare. The reasons, in our view are the following:
1. A rising tide has lifted all boats. Rising markets have lifted many companies out of net/net territory, which is typical coming out of the upheaval we saw in 2008 and 2009. But even that does not tell the whole story.
2. There's also been a renewed interest in net/nets over the past several years. New buyers have entered the markets, bid up prices, and many net/nets don't stay there very long. New attention has been brought by websites and other resources that have alerted investors to the potential benefits of net/net investing. This website was one of the first. In essence, we've shot ourselves in the foot, and helped drive net/nets into extinction.
Not to worry though, a market correction will ultimately re-stock the net/net shelves at least temporarily. That's not something we wish for. In fact, despite the fact that many are calling for a correction following a five-year bull run, we don't believe the markets are extremely overvalued at this point. We are certainly struggling to find much that is interesting in terms of deep value, but don't believe there's a huge bubble. It's like purgatory for value investors.
*The author has a position in Richardson Electronics. This is neither a recommendation to buy or sell any securities. All information provided believed to be reliable and presented for information purposes only
Friday, May 16, 2014
Thursday, May 15, 2014
10th Annual New York Value Investing Congress- September 8 & 9, 2014: Cheap Stocks Readers save 50% if registered by 6/24
Cheap Stocks will again be a media sponsor for this year's New York Value Investing Congress, and they have been kind enough to offer our readers a discount to this year's event.
This year, seating will be limited to 275, so if you are interested in attending what we consider to be value investing's best conference, consider registering ASAP.
Regular Price: $5,995
Special Offer – Over 50% off till 6/24/14
Offer expires: 6/24/14
Discount Code: CHEAPSTOCKS
More information about the event:
10th Annual New York Value Investing Congress
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Date: September 8 – 9, 2014
Confirmed speakers include:
- Leon Cooperman, Omega Advisors
- Alexander Roepers, Atlantic Investment Management
- Carson Block, Muddy Waters Research
- Whitney Tilson, Kase Capital
- Sahm Adrangi, Kerrisdale Capital Management
- David Hurwitz, SC Fundamental
- Jeffrey Smith, Starboard Value
- Michael Kao, Akanthos Capital Management
- Guy Gottfried, Rational Investment Group
- John Lewis, Osmium Partners
- Tim Eriksen, Eriksen Capital Management
- Cliff Remily, Northwest Priority Capital
- With many more to come!
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