When Bad Things Happen to Good Stocks: A Fundamental Investor’s Opportunity
As Benjamin Graham, widely known as “the father of value investing”, understood well, stock prices can bounce around for a range of different reasons, and any of them may have very little to do with the fundamental prospects, earnings and cash flows that the underlying business will ultimately generate for its owners (shareholders) over time. […]
Apple Part I: A $1 trillion company at 18x P/E
Last week I attended an Apple summit hosted by a prominent Apple analyst. One of the main lamentations shared by both the host and a majority of the audience (for this was not a gathering of investment analysts) was why Apple, the most valuable company and arguably the most recognisable brand in the world, was […]
Buy on the sound of canons
As the Buffett adage goes, “be fearful when others are greedy and greedy when others are fearful”. At its core, the phrase highlights the necessity of contrarian thinking when investing. Achieving investment outperformance requires a non-consensus view, and for that view to be proven correct over time. While this sounds straightforward, it is often challenging […]
How cheap is Alibaba?
When Alibaba reported its full year FY18 results in early May, one number that surprised us the most was the revenue guidance for FY19. Heading into the result, Wall Street analysts were expecting FY19 revenue of around RMB 350 billion, or year-on-year growth of around 40%. Instead, Alibaba delivered a stunner – 60% revenue growth […]
The Great Content Rebundling
Earlier this week, Variety published an interesting article citing data from TDG that suggested Amazon Channels accounted for 55% of all third-party direct-to-consumer (“DTC”) video subscriptions. The TDG survey of 2,000 US broadband users revealed that substantially more than half of the subscribers to premium DTC channels such as HBO and Showtime had subscribed through […]
More Apple Services
In February this year, Daniel Wu wrote an insightful piece about Apple’s transformation from a company that has historically been driven exclusively by hardware to one which is today focussed on driving value through the growth of its services offering. One calendar quarter and a set of financial results later, Apple is demonstrating impressive growth […]
Facebook and the power of social data
Over the weekend, The New York Times and The Observer of London published an exposé on Cambridge Analytica’s use of over 50 million illegally obtained Facebook profiles to build out a psychographic platform for targeting American voters and influencing their behaviour during the 2016 Presidential Election. Facebook shares sold off 7% in reaction to the […]
HomePod and Apple’s fork in the road
The release of the HomePod speaker marks Apple’s belated entry into the world of AI voice assistant hardware. The HomePod is quintessentially Apple in every way: its appearance is aesthetically pleasing, its sound quality blows competitors out of the water, it is expensive and presumably earns high margins for Apple, and it works exclusively within […]
Microsoft’s outperformance is shifting the goal posts
Next week will mark the two-year anniversary of Microsoft first being added to Montaka’s long portfolio. At the time Microsoft traded at around $50 per share, which we believed to be considerably cheap. Since then the stock has risen strongly, peaking at $95 last week and trading at $85 overnight. At the same time the […]
Apple as a service company?
Last week, when Apple (NASDAQ: AAPL) reported its much-anticipated December quarter earnings, CEO Tim Cook provided a key update on the health of the Apple ecosystem – as of January 2018, there were 1.3 billion active Apple devices worldwide, an increase of 30% over two years ago. The healthy growth of Apple’s global installed base, and […]
