Yelp

Yelp (YELP) is an interesting company that seems undervalued. This might stem from a misunderstanding about the core economic drivers of the business. While most consumers view it merely as a forum for restaurant reviews, this segment only accounts for 15% of ad revenue. Home & local services (i.e.…

Magical Thinking

There is a dangerous type of "magical thinking" going on in the markets right now. Investors appear to believe that since the lockdowns are easing, coronavirus is a solved problem and that a V-shaped recovery is a given. On the back of such enthusiasm, even failed businessmen are giving the…

Thoughts on Airlines; Southwest (LUV) Valuation

There are few industries with as much uncertainty right now as airlines. Even the "Oracle of Omaha", Warren Buffett, admitted that the future of airlines was too unclear for him and recently sold all of his positions. Buffett and many other intelligent people believe that the future of air travel…

Extrapolating

Source: xkcdLike many people, I'm spending a lot of my time during the age of Coronavirus sitting at home reading about Coronavirus. This abundance of free time, combined with a 24-hour news cycle that preys upon our hopes and fears, is a potent combination. Now everyone (myself included) is an…

Random Thoughts: Peak Hysteria, Viral Impacts, TZOO Update

Peak HysteriaIf we haven't reached peak hysteria yet, we might be getting close. This recent NY Times article reads like a dystopian sci-fi short story published in a weekly tabloid. Emphasis added: ...fear of the virus reconfigures the very concept of public space...   People may be less inclined to jam…

Travelzoo (TZOO) Valuation

Travelzoo (TZOO) is an old-school online travel company that makes money primarily through distribution of travel deals via email newsletters. Travel suppliers (i.e. Air France, Royal Caribbean, Hilton Hotels & Resorts) pay listing fees to get exposure to the newsletter audience and it is a particularly good way for…

Trade-offs

One of the most important lessons I learned in college was the importance of trade-offs. This is particularly true in the field of Computer Science: space vs time; development speed vs technical debt; and customization vs automation are all compromises that need to be considered. Almost nothing comes for free.…

Long Term View

Fears of COVID-19 have caused the indices to fall 12% in the past three weeks. Last week, stocks suffered their biggest weekly losses since the financial crisis of 2008. Short-term fears over newly reported Coronavirus cases cause markets to tumble one day, while short-term hopes over government stimulus and global…

Berkshire Hathaway (BRK.B) Valuation

Berkshire Hathaway probably needs no introduction. It is one of the largest conglomerates in the world, and a holding company / investment vehicle for Warren Buffett, arguably the most famous investor of all-time. It is also a favorite holding of "value" investors, whose devotions to Buffett's philosophies sometimes border on the…

2019 Performance Review

In 2019, my portfolio returned 11.59%* and the S&P 500 index returned 31.49%. Underperformance relative to the index was driven by: a relatively concentrated portfolio (7 holdings, on average); poor short-term performance of a few key stocks, detailed below; and substantial cash holdings that ended the…