[VRSK] HIGH QUALITY CASH COW, LIMITED REINVESTMENT OPPORTUNITIES

(2,414 words) When evaluating the competitive advantage of a data-based analytics business, three important questions come to mind: 1) Is the data proprietary? 2) Are the insights from the data critical? and 3) Does the data fuel a product feedback loop? Verisk began its operations in 1971 as Insurance Services Offices (ISO), a non-profit enterprise started […]
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[SHW] VALUATION LOOKS STRETCHED

(2,600 words) If you’re unfamiliar with the architectural coatings sector, you might be surprised to know that selling paint can be a good business…and no one sells it more profitably in North America than SHW, whose market share gains have come from both the multi-decade shift from “Do-It-Yourself” (DIY) to professional paint jobs and a […]

QUICK BLURBS [CF, SIG, UHAL]

(2,536 words) [SIG] I have zero interest in this stock, but sometimes it’s fun to reminisce on missed calls.  About a year ago, a friend who manages a long/short fund was considering shorting SIG and asked for my opinion.  I said I thought it was a bad idea.  At the time, the stock was ~$110. […]
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[CBG] GOOD BIZ, EXPENSIVE ON NORMALIZED EARNINGS

(2,377 words) CBG is a fine company but to claim that it is reasonably cycle-resilient post-GWS acquisition is an exaggeration.  Deriving 70% of fee revenue from contractual and purportedly recurring sources will not meaningfully cushion profits in the event of a commercial real estate swoon. From its roots as a regional commercial real estate broker founded in the aftermath of […]
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[GNRC] VALUE COME, VALUE GO

(2,400 words) In between diaper changes and infant tantrums, I finally got around to looking at GNRC this past week. Given the stock’s ostensibly low earnings multiple and a share price that has gotten hammered over the last several years on what appears to be mostly cyclical reasons, I wanted to like the company but couldn’t […]
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[PYPL] BUSINESS MODEL AND COMPETITION

(2,182 words) PayPal has moved far beyond its roots as an online auctions payment facilitator in the late 1990s/early 2000s (serving eBay, mostly), broadening and deepening its 2-sided network, expanding its reach to mobile (2006), offline transactions (2012), and increasingly, “contextual commerce” (i.e., consumers buying directly on Facebook rather than being redirected to the retailers site).  PayPal’s central […]
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QUICK BLURBS [ADNT, JLL, MA, MRC, SNI]

(2,218 words) [MA] In 2009, the Unique Identification Authority of India (UIDAI) launched an ambitious nationwide program to collect all 10 fingerprints, iris scans, a photo, and all sorts of personal information from each of its 1.2bn citizens in a central database, with a unique 12-digit ID number assigned to each record.  The goal was to […]
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[ESRX] POST-ANTM THOUGHTS

(2,410 words) [ESRX] After more than a year of acrimonious public squabbling, it appears ANTM will be terminating its relationship with ESRX: The Company’s current long-term PBM contract with Anthem expires on December 31, 2019, and Anthem is currently engaged in a Request for Proposal (RFP) process for a PBM service provider following the end of its […]
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