Quick Blurbs [MSCI, Paypal, S&P Global]

[SPGI – S&P Global, MSCI – MSCI Inc.] New indices are created every day as passive strategies flourish and investors invent ways to track exposures across asset classes, geographies, sectors, and market caps.  They are stamped with the imprimatur of a well-known provider, validated with fresh pools of capital, and before long, become indispensable benchmarks or […]
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[DOOR – Masonite Intl] Reasonable Valuation, So-So Moat

[DOOR – Masonite Intl] This stock got smoked last week post-earnings.  DOOR is now back to where it was at the start of 2014, when the company was generating less than half the pre-tax cash profits it does today. If you’re unfamiliar, Masonite and Jen-Weld (JELD) are vertically integrated duopolists in the US residential interior door manufacturing […]
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Quick Blurbs [SAP, Tripadvisor]

[TRIP – Tripadvisor] This stock had a few crazy trading days last week, opening down 8% before closing up 2.5% on the first full trading day post-earning and then rallying again days later, apparently sparked by rustlings of a take-out [TRIP’s chairman Greg Maffei stoked such hopes a few months ago].  At least opposes this hypothetical […]
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[TRIP – Tripadvisor] Good Asset, Fumbled Monetization Strategy

For many years prior to 2012, Tripadvisor was accused of “over-monetizing” its site, bombarding visitors with “pop-up” windows that redirected visitors to the sites of its OTA and hotel ad partners.  In late 2012/early 2013, TRIP began replacing the antiquated pop-up model with in-line meta (so visitors could compare rates across different OTA and hotel […]

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[ASHG – Ash Grove Cement] Cheap Stock or Value Trap?

“People always think more about how new ground can be broken than they think about how existing institutions can be sustained or existing facilities can be maintained.  It leads to a constant trap where we underinvest in old things, then old things disappoint us, then we feel a need for new things, then to satisfy […]

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[INTU] Intuit

It seems not too long ago, business arrangements between application providers were called partnerships….now they carry distended labels like platforms or ecosystems.  Platforms come in various guises.  Some, like eBay or AirBnB, don’t create products for direct consumption, but instead provide the connective tissue for various constituents of the platform to connect, taking a cut […]

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[VRSK – Verisk] High Quality Cash Flow, Limited Reinvestment Opportunities

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 by P&C […]

[SHW – Sherwin-Williams] Valuation Looks Stretched

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 leading position […]

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