Blackstone: a valuable platform of satellites
Blackstone (NYSE: BX) has grown to become one of the world’s largest and highest-quality asset managers – managing a staggering US$571 billion in assets across the major asset classes. We believe Blackstone is well-positioned to capture: (i) the ongoing shift towards a core-satellite approach to portfolio construction; and (ii) the asset price appreciation that continues to flow from the ongoing structural decline in interest rates.
TAM: Linear Thinking in a Non-Linear World
Traditional measures of TAM can be directionally misleading, not only in the early years of a true disruption, but at practically any point along the path. As disruptive technologies / businesses tend to consume adjacent markets, make others obsolete and create entirely new ones along their journey, it is incredible difficult to determine what is reasonable and what is not when assessing TAM.
The importance of a Competitive Advantage Period
Competitive Advantage Period is a key investment concept that is often overlooked by investors. An understanding of this concept can help investors better determine what they’re paying for when they buy a stock.
Searching for Alphabet’s Growth Engines
Last week Alphabet, the parent company of Google, released its financial results for the final quarter and full year of 2019. For the first time management disclosed the revenue contribution of two key growth engines of the company: YouTube and Google Cloud.
The inequality of low interest rates
As global interest rates continue their march towards the floor, we continue to see asset prices inflate. But interest rates do not treat all humans equally. The benefits of compounding asset values accrue largely to the few who are already wealthy. In a lower-for-longer interest rate environment, this dynamic will only accelerate.
What might be the economic impact of the coronavirus?
The coronavirus that originated in China recently has had a devastating human impact. From an economic perspective, this article explores some high-level numbers that might assist investors in grappling with the economic impact of the coronavirus.
Obsessing over margins
Today’s world is characterised by fast-money investors looking for high-growth and high-margin businesses, such that businesses or industries with lower margins are considered “boring” or are frowned upon. But are low margins a dealbreaker on their own?
Parcel delivery: a rock and a hard place
FedEx and UPS are being rapidly featurized by Amazon’s growing logistics business. With an unparalleled lead in e-commerce, data and capital, Amazon is set to shake up the package delivery industry. Can the old incumbents adapt to a new competitive, low margin environment, or will they struggle to survive?
Can “Dr Copper” Catch a Virus?
As the world braces for a potential pandemic with the latest mutation of the coronavirus rapidly spreading across the world, “Dr Copper” has seemingly made up his mind. The commodity is now in the midst of its worst stretch of declines in >34 years. With panic selling gripping the copper market, one wonders whether “Dr Copper” and his mystical ability to predict turning points in the global economy, is telling us to remain cautious once again.
Roll-ups and value creation
Roll-ups, not the fruity snacks, are an extremely attractive strategy for businesses to expand their product portfolios and expand their geographic presence in fragmented markets. Despite their perceived top-line benefits, we at Montaka, question whether that top-line sales growth is generated at the expense of shareholders.
