Investing Principles: Valuation

I believe that a good investment starts with proper valuation. This should be an uncontroversial statement (how do you know whether or not something is a good deal if you don't know how much it is intrinsically worth?), but from my experience most people don't seem to think this way.…

Baidu (BIDU): Valuation Update

It's been an eventful few months for Baidu's stock since my initial writeup on March 13th: The stock price was hammered due to fears of 1) "core" business (search) growth declining 2) general China macroeconomic weakness, which is impacting advertising spend and 3) trade talks between the USA and China…

Investing Principles: Owner Mentality

During the past year and a half, I feel like I've gained enough experience (mainly through making mistakes) to begin formulating a set of personal "investing principles". It's one thing to read generic aphorisms about investing in theory ("be greedy when others are fearful"), but quite another to execute on…

The Halo Effect

I recently finished reading an interesting book called The Halo Effect by Phil Rosenzweig. The premise is straightforward but powerful: most of the things that people think contribute to company performance are actually attributions based on performance. An example makes this distinction intuitively clearer: Barry Staw, then at the University…

2019 Mid-Year Portfolio Review

Not quite mid-year, but given the recent market volatility, I've been able to buy into a few companies that I've been monitoring for a while, and wanted to provide a quick summary of my positions and rationale. I think it's also important to chronicle both the ups and the downs…

XPP: XP Power

Things have been quiet on the blog lately because there hasn't been much actionable activity on my end. I've been looking into a lot of companies, but for the most part things seem fairly valued or overvalued. Given the "temperature" of the market - the recent WSJ headline of "'Fear…

BIDU: China's Google?

Baidu (BIDU) may be one of the rarest of sightings: an undervalued Chinese tech stock. It's traditionally hailed as China's Google, and operates in similar sectors: Search - With roughly 75% of China's market shareVideo - Both user generated content (like YouTube) and high-quality original programming (like Netflix)Cloud Services…

AI, ML, 5G, IoT: Dangerous Investment Acronyms

It's hard to read an earnings call transcript now without running into references to Artificial Intelligence (AI), Machine Learning (ML), 5th Generation Wireless (5G) or IoT (Internet of Things) - even in seemingly non-technical and historically stodgy companies. It doesn't matter what industry you are in: these technologies are going…

NOK: Thoughts on Q4 2018 Earnings

Recently, I wrote about Nokia, and highlighted some high level assumptions for a general investment thesis. I wanted to provide a quick update based on recently released Q4 2018 earnings, and see if any of those assumptions warrant a re-examination. Q4 earnings were stronger than anticipated, but the stock has…

Nokia: Models, Precision and Accuracy

"All models are wrong, but some are useful" - George BoxI've always been skeptical of financial models. First, personal experience has taught me that, even with access to what essentially amounts to "insider information" and deep industry expertise, I still find it impossible to reliably predict where my own businesses…