Intelligent Cloning: Evaluating Allison Transmission

This quarterly member publication is authored by MOI Global contributor and Zurich Project participant Peter Coenen, a value investor based in the Netherlands.

Japan and Lapland

This summer, I had an opportunity to visit two places the names of which almost rhyme: Japan and Lapland. Wherever I travel, I always look at the world in part through my investing eyes. It is an aspect of my job conditioning.

The Third-Generation Curse: Impatience vs. Patrimony-Building

There is a famous proverb in the US: “From shirtsleeves to shirtsleeves in three generations.” Interestingly, many diverse nations have an equivalent saying.

Tennis and Speculation — How to Survive a Loser’s Game

Munger attributes a good portion of Berkshire’s success to avoiding basic errors in order to prevent losing money needlessly, as their goal is to have the best long-term return possible.

Don’t You Believe Them

Country allocation should not be about countries. It should be about finding pots of value around the globe, and focused managers able to extract them.

European Banking — A Quiz of Sorts

Let us start with a short quiz. I list the financial characteristics of five banks. I then ask you to match them with their market valuation metrics.

Diagram of Ensemble’s Investment Philosophy

Before we invest, we must believe that three key factors – management, moat, and forecastability (which informs our valuation) – are present. These factors are of equal importance.

Investment Mistakes: Scratch or Scar?

Scratches are not only for children but also for investors. We have suffered our particular scratch with Prosegur Cash. This company, dedicated to cash logistics and cash management, fell 20% in just two days, and you may wonder why.

Position Sizing: Why Conviction Matters

Investors talk incessantly about what investment they think is a good buy. But rarely do they discuss how much of any given investment to buy. This second question is vitally important.

Search Engine Optimization: An Enduring Competitive Advantage?

This article is authored by MOI Global instructor Paolo Cipriani, a private investor, based in Tuscany, Italy. In the era of the…

Why SVN Capital Decided to Invest in A.O. Smith

In Q1 2019 I started building a position in AOS, a 144-year old company that manufactures and sells water heating and treating appliances.

Why Greenhaven Road Capital Decided to Invest in Nintendo

Nintendo has been a “feast or famine” company that has seen its fortunes rise and fall depending on the release cycle and reception of gaming platform consoles and the attached games.

GoDaddy: Scale Player in a Fragmented Industry

GoDaddy has multiple levers to drive material upside in coming years including accretive M&A, rising ARPU and continued bookings growth.

Why We Sold This Controversial Stock

Trupanion is a good business and could very well make us look dumb for selling it. We lost faith, however, in the company’s ability to reach Rule Maker status…

Investing in an Environment of Negative Bond Yields

Companies with large debt are the most vulnerable during periods of economic stress. This will hold true when the upside-down world of negative interest rates corrects itself.

Why Joining the SharpSpring Board of Directors Makes Sense

Joining the board would restrict our ability to sell shares to specified windows of time, but given our projected multi-year holding period, I think it is an acceptable risk.

The Coming Bull Market in Value Investing

The bubble in growth stocks, fed by cheap money, is coming to an end. In this environment, GDS Investments will maintain its steady course of value investing.

Value Investing Amid Low and Incomprehensibly Low Interest Rates

Even two years ago, we could not have imagined the day when Altice, the true “high yield” borrower if there ever was one, would sport negative yields on certain short-term debt.

Reviewing Our Theses on Disney, Charter, Comcast, RBI, F1, and Fox

This article by Francisco Olivera is excerpted from a letter of Arevilo Capital Management, based in San Juan, Puerto Rico.

“Outrageous” Profit Margins

I find myself annoyed buying beer at a baseball game. Since I’m free to buy or not buy a beer, you would think that if I buy one then I must find the price reasonable.

Why Boring Stocks Are Beautiful (And May Be Risky Today)

If you’re buying low beta/boring stocks at lofty valuations, you’re making an implicit bet that rates will remain low and that future equity returns will be lower than historical averages.

Update on Our Investments in U.S. Airlines

There is never a dull moment in the airline business, and H1 2019 was no exception. Gyrating oil prices, fierce competition, swirling macro conditions, and the Boeing 737 MAX tragedy…

Perspectives on Selected Holdings of the Ensemble Fund

It is amazing to think that just two quarters ago our letter focused on why the market was already discounting a mild recession and it made sense to stay long US equities.

Update on Our Investments in Building Products Companies

The core elements of AWI’s business – its dominant competitive position, high margins, and FCF generation – were in place and apparent in 2015 when we initiated our investment…

Value Investors – Avoiding Mining at All Costs, But Why?

Valuation is a conviction building exercise — we have reviewed a company and it appears to have the ingredients for a good investment; now we must build conviction in that claim.

Series on Position Sizing (Part One): Research Stages

At Ensemble Capital we consider three inputs when we size our positions: return potential, conviction, and research stage.

Improving the Process of Selling an Investment

The process of selling based on the relationship between price and value will not and should not change. What is changing is an increased awareness of behavioral biases…

The Ground Rules of Engagement for First-Time Investors

I have often told clients that our approach, with low trading volumes and long holding times (which means avoiding triggering capital gains), generates more wealth, tax-free.

Moat Erosion Starts Behind the Castle Walls

Moat erosion begins behind castle walls. Only after a company loses customer focus, gets lazy or weighed down by bureaucracy, do competitors have a chance to destroy the moat.

Going from Rule Breaker to Rule Maker

Todd Wenning provides a striking case study on how great companies have dealt with difficult obstacles in the past. They all need to adapt from being rule breakers to become rule makers.