– Why Berkshire is killing it right now: A wonderful way to play the housing market recovery
– Muddled models: Why economist’s models fail to work
– Krugmenistan vs Estonia: Where Krugman fails
– Consumers are hopeless at math: Why do we fail even at basic math skills?
– Interview with Irving Kahn: The legend is still investing at an age of 106.
– East Coast’s Q2 Letter: Great stuff for true value investors
– Delivering Alpha Conference: Good place to go for idea hunting
An update since I’ve been a bit active in the last few weeks.
I sold out of JCP recently. Nothing not to like about it. Infact I had bought more just a few days ago. So why sell? Because of Taro Pharma, more below. Regarding JCP, I still like it a lot and at these prices it is a very good opportunity for patient investors. But Taro Pharma was too compelling and I know the management team much more.
I bought a position in Goldgroup Mining. I follow Pabrai’s initial approach to portfolio management, that no more than 1 position in any industry. Since I own YNG in mining, buying Goldgroup was not on my wish list. But after the huge drop in stock price (from $1.70 to $.45) in matter of months, huge insider buying, and a short-term catalyst made it too compelling to pass up. There is some stuff written about Goldgroup, but all you have to do is look at the insider buying since June.
I bought shares in Taro Pharma. I had sold the shares couple months ago. My main reason for selling was the resolution on Sun Pharma’s offer, of $24.50, could drag on longer than I expected. Today, Taro announced that it rejected Sun’s offer. To my pleasant surprise, the stock was still hanging around the price that I sold at. So I jumped in and bought the shares. The valuation is very straightforward. The company is generating around $200M in cash yearly. The company has around $300M net cash and market cap of $1.6B. The company has little need for cash. And the Sun Pharma team is just in the initial stage of turning around the revenue at Taro. So the questions that pop up for me is what happens with the cash generated each year. I think we will see Taro use the cash to build up its product pipeline.