Buffett’s lesson (granted, he was barely a teenager) that he later recounted was that there was value in “letting winners run” rather than taking a small profit as soon as the opportunity presented itself. Real multi-generational wealth doesn’t come from capturing 10% and 20% capital gains here and there, but rather, by letting an investment like Coca-Cola grow from x to 52x as it has done over the past 35 years.
Menciones a Clx Nestle Colgate, Kraft que ha dado el susto en 2019, etc…
La filosofía de TimMc me ayudó mucho a comprar Todos los Consumer Staples que se han acercado hacia el 3,8 - 4% div, sobre todo en sus caidas sectoriales de 2018.
Tim McAleenan sobre FEDEX: (26.05.2019)
I am finishing my reading of the book “Changing How The World Does Business: FedEx’s Incredible Journey to Success - The Inside Story” that chronicles how FedEx rose to the top of the courier delivery market under the hand of its founder Fred Smith who had turned a $4 million inheritance (along with a $91 raise in venture capital) into a business that has been one of the best publicly traded stocks that the investor community has ever encountered in the past half century.
Specifically, FedEx traded at a little over $1.07 per share (adjusted for splits) in 1979 and now, counting dividends, has created more than $257 in value for each $1.47 share purchased in 1979. The increase has been a rise in value of 23,918% over the past forty years, for an annual compounding rate of 14.69% over the past four decades.
When I studied FedEx’s record, I wanted to analyze the obvious question: What has this company gotten right to elevate to the status of a super-compounder in the investing world?
The first thing I noticed is that FedEx’s origins related to solving a problem that was very important to customers–super fast delivery. In 1978, a year before its IPO, it rolled out the slogan: “When It Absolutely, Positively Has To Be There Overnight.” It may have been clunky, but my gosh, the point of the business was clear. If you needed something shipped quickly, FedEx was the company for you.
That came with two important implications. First, the company was creating a brand for itself in an area where it is difficult to differentiate itself. Aren’t all package delivery services the same? The temptation could have been to try and compete on price, dooming itself for perpetually low margins. Instead, it created a brand name that meant speedy delivery, giving it a clear market niche for business customers as well as individuals that needed a document overnight.
There is an old business saying: “The greater the problem, the greater the compensation for fixing the problem.” If someone’s “problem” is that they need to get package from Location A to Location B within two weeks, well, the compensation is not going to be great because there is no particular time limitation that makes the problem great. But if you need to get to Location B within 12 hours, you now have a problem that you are willing to pay much more to solve.
By rolling out distribution networks across 25 cities in the 1970s, FedEx was able to charge premium pricing for fast delivery. This meant higher retained profits that could be used to roll out even more locations and deliver faster and faster, increasing delivery speeds in locations beyond America’s largest cities and into America’s secondary cities (population-wise) where the same strategy could be re-executed.
Next, FedEx actually cared about customer satisfaction. Who is the person or entity most likely to need overnight shipping? The answer: The person or entity who recently used your service for overnight shipping.
Fred Smith measured the right things, having FedEx focused on the value of a customer’s loyalty score over the course of a lifetime. With prime business customers, a loyal relationship could mean $15,000 per year in revenues for 18 years as an expected life. If that customer was dissatisfied over a transaction, FedEx management wasn’t trained to see it as $280 walking out the door, but rather, $280,000 walking out the door. When you think about what a recurring customer represents over the course of decades, rather than the specific transaction in front of you, you will treat them better and further “build the brand” because it actually stands for value.
When FedEx polled its business customers in order to learn what was disappointing its customers, it learned that business customers wanted to know exactly where its packages were located throughout the shipment process. Although FedEx wasn’t the first to roll out shipment tracking technology, it was the first company to use it as a standard feature that it is now common in the courier industry.
You know what else is worth paying attention to? People always act like they missed the boat with these investments. They think, “Yeah, it’s nice that this incredible growth happened forty years ago; that doesn’t do me any good today.” Guess what? I could have easily written this article a decade ago, and the factual analysis hasn’t changed. Over the past ten years, FedEx has continued to deliver goods faster and faster while still charging a premium price to do so.
The earnings per share were $3.76 in 2009. Today, they are $15.45 per share. The profits per share are rolling forward, year after year, as FedEx continues to invest $4 billion per year in distribution facilities so it can get packages to customers faster, faster, faster. The premise for what made FedEx an incredible business has not changed. And now the stock trades at 10x earnings. Technically, this is the lowest valuation for the stock on a P/E ratio basis in the past twenty years, including the Great Recession.
And the business is growing at 8.5% and paying out a 1.6% dividend. In other words, earnings per share and dividends will give investors 10% returns, plus there is a fair chance of P/E ratio expansion to 15x earnings, which suggests a reasonable possibility of 12-14% returns over the coming ten years.
Just last year, the investor community was willing to pay $274 per share for the stock. They were willing to value the business at 18x earnings, which was in line with its historical rate. Now, earnings per share growth falls to the mid-single digit rate, and suddenly, the stock goes on sale.
It would cost a competitor $100 billion to roll out infrastructure that could compete with FedEx, and even then, it would co-exist with FedEx rather than wipe it out because logistics is not a winner-take-all business.
I think FedEx at 10x earnings is one of the quietest deals available among mega-caps today. The profits are growing at a high single digit rate, the P/E is as low as it has ever been in the past twenty years by at least 25%, and the company is rolling out new distribution facilities. It is executing the same strategy that has delivered 14% annual returns over the past forty years, and hardly anyone has noticed. It is quintessential “great company at a moderate price” territory that is responsible for nearly all of the super-compounding that investors are able to receive from a single investment decision over time.
Me presento: timi
Sobre el cortoplacismo (Junio 2019)
Como siempre, un artículo muy interesante/cabal, donde destacaría sobre todo:
While online stock trading existed in 2009, the next recession will be the first time investors can receive app alerts showing you red losses in the thousands or tens of thousands of dollars on a bad day. You can literally be in the bathroom, pull up your app, and sell your ownership position at a short-term low. The opportunity for mischief is too darn easy.
Traducción en oculto.
Si bien el comercio de acciones en línea existió en 2009, la próxima recesión será la primera vez que los inversores puedan recibir alertas de aplicaciones que le muestren pérdidas de miles o decenas de miles de dólares en un día malo. Literalmente puede estar en el baño, abrir su aplicación y vender su posición de propietario a un mínimo a corto plazo. La oportunidad de hacer travesuras es demasiado fácil.
Puede que esta nueva variante haga que las bajadas sean mayores, quizá también ampliadas por la indexación, para lo malo y lo bueno: Más rojo en mi cartera; más baratas las empresas a comprar.
Conectado con la cita, también me resulta muy llamativa la “democratización” de las “inversiones”. En otros países, en otros ambientes, es lo más normal del mundo, pero no en el mío. Bueno, qué demonios, yo mismo soy un ejemplo de esa ampliación de mercado.
Por no hablar de las ubicuas criptomonedas, hace unas semanas un compañero me explicó cómo obtiene más dinero en el Forex que con su trabajo habitual: sacó el móvil, lo puso sobre la mesa y me empezó a enseñar cómo ponía las órdenes. Me quedé fascinado por el dinero que estaba ganando y, si no fuese yo tan miedoso, le hubiera pedido que me ayudara a conseguir ese maná. Le hice más preguntas y la fascinación pasó a “pero qué cojones me estás contando”-ción: no conocía lo que es el apalancamiento, no sabía en qué se basan los indicadores que utiliza… Ante todas mis dudas y mis reparos, dijo una frase cierta a la que no pude reponer nada:
-onsowu, no tengo ni idea, pero soy yo el que está ganando dinero.
Y, con lo que le marcaba la aplicación de su móvil, tiene toda la razón.
Hasta que deje de hacerlo.
Yo tengo un conocido que también se dedica al tema del trading con forex. Me explicó que tiene alquilados unos servidores del copón en Frankfurt porque ser unas milésimas más rápido que los demás en este ámbito es la clave para ganar más dinero. Le dedica unas cinco horas diarias al tema cuando sale del trabajo y para el horario que no cubre ha “contratado” a un par de indios que trabajan a comisión sobre los beneficios. Al parecer en Interactive Brokers puedes crear perfiles para ayudantes dentro de tu cuenta. Tengo pendiente sentarme una tarde con él para que me desvele todos los entresijos porque de momento lo poco que me cuenta me suena a marcianada. Casi lo mismo que cuando yo le hablo de mi estrategia DGI ;-)))
Suena a la anti-IF
Si alguien tiene interés que busque la historia de Simmons y sus FI, Medallion. Quant, matemática y ordenadores. Es una lectura apasionante para un Domingo Friki.
Se le opone a WBuffet que ese si le conocéis
El problema del forex es el apalancamiento… Y los flash crash, que habrá millones de máquinas mejores y más rápidas que la tuya operando.
Se pueden poner todos los stops que quieras pero si no hay contrapartida y van apalancados… Game Over.
Como el gestor que invierte en chicharrillos de 6000acciones al día de volumen. El día que tenga que salir.
No cabe por la puerta.
Si no tiene ni idea de cómo gana dinero tampoco la tendrá cuando lo empiece a perder.
Siendo Forex imagino que, como dicen los compañeros, irá muy apalancado y con algún método basado en seguimiento de tendencias.
De todas maneras yo le preguntaría más, a ver si hay algún razonamiento subyacente interesante en su operativa que se nos haya pasado por alto o si es puro azar.
Así es. Le aprecio, pero hace años que decidí que si una persona está decidida a estamparse contra un muro, lo más que puedo recomendarle es que contemple la posibilidad de ponerse un casco.
Espero que la experiencia le vaya lo mejor posible.
Domingo Friki, allá vamos.
Me enseñó unas velas japonesas que “si van para arriba, lo normal es que vayan para arriba”; y si este indicador (que no sabía que era RSI) pasa de esta línea, “se compra o se vende”. Y ya.
Con todo esto, una media de unos 200€ al día.
Seguimiento de tendencias puro y duro con algún indicador relacionado jejeje…
Bueno, si consigue ser obtener ganancias consistentes bravo por él.
The Sequoia Fund vs. Conoco Phillips (2014)
Ahí queda claro que por bajas que sean las comisiones, el hecho de que se cobren año tras año reducen significativamente la rentabilidad de la inversión.
Parece que sale más a cuenta pagar sólo 1 vez la comisión de compra y que algunas empresas te vayan mal que no pagar año tras año comisión sobre el total de lo invertido.
Saludos desde éste paraíso que es la playa de Puerto de Alcudia.
Dividend Investing Without Regrets (2014)
There are three ways you can incorporate a margin of safety into your investing style: you can diversify, you can buy cheaply, and you can buy quality.
The Most Underrated Investor Of the 20th Century
I’ve written before that, to succeed at investing, you do not to be a credentialed individual. You don’t need an MBA. In some cases, you don’t even need a college education. No investor proved that notion more thoroughly than Walter Schloss—a man who never attended college, but very well could be the most underrated investor of the 20th century.
Schloss’s record speaks for itself: he compounded wealth at a rate of 15-16% (and that is the figure after you remove the fees he charged) from 1952 to 2002, during a time at which the broader American stock market indices increased at a clip slightly above 10%. Despite this enormous success, the closest Schloss ever came to “mainstream” in the investor world occurred when Buffett mentioned Schloss in his “Superinvestors” essay in 1984, and then late in his 2006 letter to shareholders of Berkshire Hathaway in which he referred to Schloss as one of the good guys of Wall Street.
Part of the reason why Schloss never got excessive media attention is due to the fact that he kept his practice small; he only invested on behalf of 75-100 clients. With Buffett and Munger, you have Berkshire Hathaway in the public eye—and an ownership stake is open to anyone. You could visit Loyal3 and buy a Berkshire B share as long as you have $125. With someone like Peter Lynch, you had the Magellan Fund at Fidelity to propel him to fame—a fund that anyone with $2,500 to invest or a special relationship through an employer to invest a lower amount regularly.
Schloss didn’t offer that kind of easy access. On one hand, investing on behalf of “the little guy” has tremendous appeal because it jives well with our egalitarian notions about America—anyone who puts forth the effort, saves a little something, opens up a brokerage account, and submits a buy order for BRK.B can have Warren Buffett making decisions in his or her behalf. When the brainpower of people like Schloss are beyond the reach of most Americans, with only the wealthy able to have access, something seems lacking.
Personally speaking, I don’t see it that way because running a fund that is able to be bought by anyone often lends itself to quarterly evaluations, success measured by the “what have you done for me lately?” stick, and panic selling during market declines (moments when someone like Schloss would want to be buying). I can’t begrudge someone for not wanting to play that game—if, you, say, recognized BP as a great deal as its price was falling from the $40s to the $20s during the oil spill, and loaded up in a material way, you could have to deal with a lot of caturwailing from some investors who want to know where their stock mutual fund that you’re running perfomed 10% worse than everyone else that quarter. By limiting himself to investors that trusted him and thought in five year increments rather than twelve-month periods of judgment, Schloss was able to do his thing by living his life on his own terms.
Interestingly enough, Schloss’s approach to investing was quite at odds with the style of investing discussed on this site. He did not care at all about the quality of the business—he focused solely on measures of cheapness, and salivated at the thought of finding securities trading below their working capital levels. Even though a fair amount of companies that Schloss selected went bankrupt, the ones that recovered overcompensated for this, and Schloss practiced extreme diversification by packing over 1,000 global stocks into his fund at a given time, although they were nowhere near equally weighted (the public records of Schloss’s decisions have been hard to come by, but based on editorial comments from Alice Schroeder’s Snowball about Buffett’s life, my guess is that Schloss had dozens of companies go bankrupt within his portfolio over most 3-5 year rolling periods, and this figure probably amplified during dives in the economy).
You might fairly be wondering: Why on earth would Schloss own 1,000 stocks in his fund, roughly double the S&P 500 (I say “roughly” because there are times when the S&P 500 only carries 497, 498, or 499 stocks here and there)?
It’s important to remember that these people didn’t exist in a vacuum. In the case of Benjamin Graham, he became “the dean of diversification” because he grew up extraordinarily poor and had to witness local grocers mocking checks written by his mother—the local grocery stores would only accept cash from them. As for Schloss, he had to deal with seeing his father’s warehouse burn down, and his mother’s inheritance squandered in concentrated bets right before the crash of ’29 that caused banks trading at 8-16x book value collapse to a third of book value (causing extraordinary, permanent loss).
Much to Schloss’s credit, he did not turn away from business and curse the name of the American economy. He would have been forgiven for doing so, given the misery it caused his parents. Instead, he adapted. He rephrased, “How can I learn from the failures of my parents and succeed?” A courageous question to ask, and Schloss answered by practicing widespread diversification (at a rate far in excess that practiced by his investing peers) applied to a set of stocks that appeared objectively cheap.
There are three ways you can incorporate a margin of safety into your investing style: you can diversify, you can buy cheaply, and you can buy quality. Schloss spent his life focusing on the first two.
Equally amazing as everything else, Schloss practiced his craft with quiet dignity. He would read financial statements, and always read the footnotes first—he figured that’s where the companies hid the good stuff. He would finish his working day at 4:30 PM, leave work, and not think about investments any more after that.
Most importantly, Schloss was a man who believed in himself. When he went to work at Graham-Newman, he was seen as several spots on the totem pole below Buffett. People who saw Schloss then figured he would be a mid-tier employee, earning an average American salary for the duration of his life. Schloss knew he was capable of more than that. He left the stable confines of Graham-Newman to strike it out on his own as an investor, and at the time he was doing it, his peers weren’t thinking that it was the birth of one of the most brilliant careers in American investing history.
A lot of people that weigh these things will go on believing that, say, Warren Buffett was a better investor. After all, Buffett spent his life compounding wealth at 20% for no fee at Berkshire, while Schloss earned his investors 16% net of fees at his operation. But you can’t say that—they sought different things out of life. For Buffett, investing was all encompassing. He had to have private companies, and investing was never off of his mind. Buffett’s biography is filled with Buffett stepping out of his vacation home on Laguna Beach to do business deals that were presenting themselves. Schloss never had insurance float, or private cash flowing in from businesses he controlled. When it was 4:30, Schloss was done for the day. No more investments—because that is how he wanted to structure his life. He lived it all on his own terms, and that is the great lesson from his life. Most people have no idea who he was, but the glory of his life is not diminished by our own ignorance."
Pure value en acción:
Histórico analisis en mi opinión sobre Visa.
Lo pongo aquí por el placer de volver a leerlo. Simplemente.
No estaba despierto a esas horas, pero me ayudó a comprar V a 70$ un poco después:
August 24, 2015
Stop What You Are Doing And Buy Visa Stock Right Now (August 24, 2015)
Wow. I guess my conversation about stock market volatility was better timed than I thought. As far as I can tell, some of the greatest companies in the world are now trading at 5% to 10% discounts to fair value. Diageo at $101. Hershey at $84. Coca-Cola at $36. Exxon at $69. Johnson & Johnson at $90. General Electric flirting with $22. Pick any of the above, hit the reinvest button, hold for a very long time, and you’ll be happy with the results.
However, the stock that has especially caught my attention is Visa. Out of all the companies in the Dow Jones, it has the greatest earnings per share growth characteristics. I think it would be quite difficult to come up with more than five other companies that are worth more than $150 billion that are growing revenues at a rate north of 10%. The balance sheet is perfect, and earnings per share growth is somewhere in the 12-15% range. Visa is exactly the kind of company that leads to significant increases in net worth when held for decades.
At the time of this writing, the stock has declined from $74 last Tuesday to a low of $60 today. Most of the loss happened during the pre-market trading, when the $71 share price on Friday fell to $65 right before the market opened less than twenty minutes ago.
I have no idea how long Visa will stay down, but this is a great opportunity to buy the best growth company in the S&P 500 at a fair price. There are about one or two dozen great opportunities to buy the highest caliber companies in the world at fair value right now, and I imagine that buying Visa today will deliver total returns in the 12% to 15% range over the coming ten to fifteen years. If you have recognized the greatness of Visa but have been concerned about its valuation, I would take advantage of buying this stock while the price hovers at $60. Over the long term, you should be well rewarded for your rationality amidst this mini-market panic.
No andaba equivocado el hombre.