Calm after the earnings storm: Joseph's top articles in September
Joseph wrote about the world's cheapest Wide Moat stock, capital allocation mishaps, legendary investing letters and huge share buybacks.
September was a month of firsts.
Our first month paying rent after several months of petsitting. My first visits to Melbourne and the Hunter Valley. Oh, and my first time being hit on the full by a golf ball. In case you're wondering, it didn't hurt as much as I thought it would. But I'm glad it hit one of my love handles and not my head.
In the day job, things were a lot more like business as usual. I started by highlighting our analyst Shaun Ler's research on a company that, according to his Fair Value estimate, is right up there with the world's cheapest Wide Moat stocks. Shaun thinks that markets are getting this company's story completely wrong. Go here to see what he's talking about.
The end of our zero rent era has obviously given my finances a bit of a shake, albeit one my partner and I wanted to happen. When the situation changes, though, so too must the plan. So I took a fresh look my numbers and planned a route ahead. You can see how I plan to move closer to my short and long-term financial goals here.
Getting away for a couple of weekends gave me a chance to catch up on some reading. But seeing as there enough firsts for one month, I decided to revisit an old favourite instead of picking up something new. Nick Sleep and Qais Zakaria's investing letters have quite rightly taken their place in investing folklore. You can see my biggest takeaways here.
Sleep and Zakaria became two of the best known buy-and-hold investors. And when it comes to things that decide the long-term return delivered by a company's shares, two things stand out. 1) the quality and growth prospects of the business and 2) how effectively management allocate the cash generated.
In the spirit of Charlie Munger, I went looking for situations where our analysts think management fell short in this regard. Not to dig them out, but in the hope of learning from some of their mistakes.
Staying loosely on the topic of capital allocation, I unearthed two US shares that trade at a big discount to our Fair Value estimate and have bought back stock aggressively. If our analysts are right, that looks like a sound use of funds.
I also explored how one moated ASX company has ended up with so much cash on the balance sheet, and what our analyst thinks it might do with it. A clue: the company is a cash cow partly because it doesn't own many cows. Read more here...
On the personal front, September was also notable in another way. It marked a year since my partner and I moved to Sydney.
We still haven't seen as much of the country as we'd like (dogsitting requires you to stay put) but we're getting there slowly. Next stop, Tassie. But first, US earnings season and a new exciting feature for our readers, launching in early October.
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