I am back from Buffett’s Omaha. Every year I come back feeling supercharged for the year ahead. This year was no different. From morning till night I had the pleasure of sharing and debating ideas with investors from all over the world. Though I did not plan it this way, the first day I had [...]
On January 18, 2011 I had a great pleasure to give a lecture on China and its impact on global economy at Johns Hopkings University Applied Physics Lab. You can watch it now on youtube, click on this link
While attending Berkshire Hathaway’s annual meeting, I was interviewed by Matt Nesto of Yahoo! Breakout about Microsoft, EA, Facebook.
Here is a thought for an eager Facebook investor: Google revenue – $40 billion; market capitalization $200 billion (plus $40 billion of cash). Facebook revenue $4 billion; market capitalization $100 billion. So Facebook has to grow revenue 10x for you to double your money. Good luck! follow on twitter Vitaliy N. Katsenelson, CFA, is Chief [...]
I have to confess, I am tired of writing “structured” articles, the ones where I have to limit my thoughts to 800 words. So with this email I am taking a break. This is an unstructured stream of thought, in no particular sequence. Deadline to register for VALUEx Vail is May 1st. I am [...]
Best Buy’s CEO Brian Dunn did a courageous and proper thing for shareholders by resigning. He was not the right person to lead Best Buy into battle against online-only competitors that use Best Buy’s spacious and beautiful stores as the showroom for their products. To make things even worse, smart cell phones make comparison shopping [...]
Spring is here, time to ride my bicycle to work. This is the season when I pinch myself to remind me how great life is. I have to admit, I truly started to appreciate life when I had kids. They are still young – my son Jonah is 10, daughter Hannah is six. Though I [...]
In the classic book The Wizard of Oz, the Wizard decreed that everyone who entered the Emerald City wear green-tinted glasses. Visitors and citizens were told that this was to protect them from the “brightness and glory.” In truth, though, the Wizard had lost his mojo and become a run-of-the-mill charlatan. There was no brightness [...]
On the surface Xerox Corp. smells a lot like its Nifty 50 brethren, once-hotter-than-the-sun-but-now-bankrupt Eastman Kodak Co. and Polaroid Corp. Its stock has gone nowhere since forever. But Xerox was not your typical overvalued blue chip of the 1990s, like Cisco Systems, Johnson & Johnson and Microsoft Corp., whose earnings have tripled or quadrupled since [...]
Though the market keeps raging to the upside, I keep seeing bearish signs in market sentiment – the VIX is hitting multi-year lows, NYSE short interest is hitting a four-year low, the ratio of insider selling to buying is running at what John Hussman calls “panic level,” 8 to 1 (for every share bought eight [...]
The Second Annual VALUEx Vail will be held in Vail, Colorado, June 20th through 22nd. VALUEx Vail is designed for serious investors to share ideas and learn from one another’s experiences, all while enjoying each other’s company and fun activities in the gorgeous Colorado mountains. Here are my thoughts and pictures from VALUEx Vail 2011. We’ll have [...]
With the split between the improving U.S. economy and the weakness in the rest of the world getting ever wider, even as markets rally, it’s more important than ever to position your portfolio in the right sectors. According to value investor Vitaliy Katsenelson, author of “The Little Book of Sideways Markets,” the risk facing investors [...]
Just as it is easier to draw straight lines than to think in nonlinear terms, it is simpler to buy stocks that have gone up a lot over the previous decade than to remain committed to the ones that have done nothing. However, linearity is for suckers. Success in investing comes from being able to [...]
I wanted to share with you my interview with my friend Bob Huebscher who runs a terrific website Adviser Perspectives. I am very excited about this interview because in a very unconstrained format we had a chance to discuss Paul Krugman’s latest bearish article on China, the linkage between the European crisis and Chinese and [...]
I am bored and exhausted. I am on my third cup of coffee, but my lack of excitement has not changed, as I am about to explain why the sleepiest, most boring stock in the universe—Microsoft Corp.—offers a very compelling r eward with very reasonable risk. Microsoft was the bright light in the tech firmament [...]
There is a good reason John Lennon wrote “All you need is love.” We want to be loved and usually gravitate toward people and things that others cherish. But when it comes to investing, love is not cheap. The trick is to identify misplaced (or mispriced) hate that will turn into love. This brings us [...]
One of the biggest hazards of being a professional money manager is that you are expected to behave in a certain way: You have to come to the office every day, work long hours, slog through countless e-mails, be on top of your portfolio (that is, check performance of your securities minute by minute), watch [...]
Everyone is looking with horror at Europe, waiting for the European Economic and Monetary Union to break up and for the PIIGS to start dropping like flies, taking the rest of the euro zone and the global economy with them. Unlikely! European monetary union was a great experiment that made a lot of sense on [...]
CNBC interview discussing sideways markets, Xerox, HP, Vivendi
Interview with Matt Nesto, segment 1: HP, Xerox, Vivendi (we own all of them) Segment 2: China
Most CEOs are not good capital allocators when it comes to their stock: They are not objective analyzing their company and thus not objective in share buyback. In majority of cases they think their stock is a buy all the time. Why? Because they spend long hours trying to grow the business, they keep telling [...]
I was going to write something smart and pithy about this recent market decline, but then I realized that I’ve written about this in the past (more than once). So here is an excerpt from the Little Book of Sideways Markets. In addition, here is a copy of the presentation about sideways markets. – Enjoy. [...]
Mark Twain said, “To a man with a hammer, everything looks like a nail.” To a Fed – an institution employing an army of economists and academics – everything looks like an economic problem that needs to be quantitatively eased. But the Fed is killing the economy. Undermines confidence Sir Alan Greenspan, who, after he [...]
Anger and frustration are the two emotions pulsing through my veins as I write this. HP, once the symbol of innovation, is being dismantled by its high-pedigreed board and the CEO of the hour (I truly hope his tenure will be measured in hours, not years). I vividly remember the early 2000s, when Carly Fiorina, [...]
I have received many emails and a few calls from friends, asking one question: What are the consequences of the downgrade? So I decided to put my thoughts on paper. I break up the consequences into three categories: fundamental (the impact on the economy), emotional (the short-term impact on the market), and political (will it [...]
A Pyrrhic victory is so called after the Greek king Pyrrhus, who, after suffering heavy losses in defeating the Romans in 279 B.C., said to those sent to congratulate him, “Another such victory over the Romans and we are undone.” Dictionary.com A quick thought on the debt-ceiling debacle. I believe that by August 2nd we’ll see the debt [...]
I looked at Brown & Brown about a year ago (May 2010), here are my thoughts which are still relevant today: Risk of growth by acquisition Very significant portion of Brown & Brown’s (BRO) growth in the past came from acquiring brokers. I am naturally skeptical of sustainability of this type of growth as it [...]
Party rulers in China are trapped in a position that chess players deeply fear — zugzwang — where any move made puts you at disadvantage. In China, the potential cost of both action and inaction is economic collapse. China is slowly starting to face the consequences of its actions — loans grew over 30% a [...]