Stock Market Consulting – August 2019 (Value Investing FM) – Investment Academy – Learn value investing from scratch

Stock Market Consulting - August 2019

Stock exchange consultation for August 2019 in which Adrián Godás and Paco Lodeiro answer questions from listeners.

On this occasion, we deal with topics such as forced sales in UCITS funds, how to find out about the operations of insiders of a company, the fórmula mágica de Joel Greenblatt, the roboadvisors, how to identify if a Another reason is it high or low, investing in the short term on value investing, the price of oil, partying with managers or our reading method.

We also talk about companies and sectors such as RockRose Energy, Constellation Software, Consol Energy, Pelatro, Prosus, offshore driller companies, aerospace mining, Cameco and Special Ingots.

You can sign up for the Barcelona Meetup on October 20 at the following link:

https://forms.gle/S2s91ofS9mVgUxyH8

Tabla de contenido

  • Contact Form.

    You can attach your question in audio by recording it through Vocaroo and attaching the corresponding link.

    General Questions from the August Stock Exchange Consultation

    On forced sales of UCITS funds

    I would like to understand the mechanics of how mutual funds operate in cases like RockRose for example, where if a fund had a position of 10% (legal limit, I think) and the price skyrockets (as has happened), I understand that he is forced to sell large amounts of shares in that company (and how this affects the company of course, depending on its size and that of the fund ...). In the same way, something similar to what happened with Woodford and Burford, how these forced sales occur and how it impacts the price. And something similar, although not related to funds, is what happened with Pelatro, where the brother decides to get rid of all his shares, but that sale does not occur (I understand) in a day, but it happens over time and conditions the company's listing for weeks or months. I do not know, I find it interesting to understand, especially for those of us who are invested in small or illiquid companies.

    (Jordi Agustí)

    On how to find out about the insider operations of a company

    What are the best ways to keep up with what insiders are doing when it comes to buying / selling a company's shares?

    (Roberto)

    About Joel Greenblatt's magic formula

    Everywhere they usually recommend Joel Greenblatt's book, so I read "The Little Book That Still Beats the Market" and it generates mixed feelings, the magic formula reminds me of the typical thing that a financial bar would tell you, because if it says that 30% returns have been achieved. Why doesn't everyone have millions of dollars? He says people don't have patience, but come on it doesn't look like a very serious explanation

    (William from Cardiff)

    About roboadvisors

    What do you think of the 'roboadvisors' and what advantages do they offer over the management companies to use and if you recommend it. Thank you.

    (César Pérez Vega)

    On how to identify when a PER is high or low

    I am getting started in the financial markets (and listening to all your podcasts). I am looking at PER and would like to know how to identify when a company / sector has a high or low PER per system. Finally, I have read that EV / EBIT is more accurate, what do you think?

    (Miguel Fernández-Ramos from Barcelona)

    On investing in the short term with value investing

    A doubt. Is value investing only good for long-term plans? That is, if my idea is to live off the stock market, do I forget about value investing? Or should I follow that philosophy for the long term and a different one to be able to eat day by day? Sorry if it's a stupid question, I don't know anything about it.

    (Choice)

    About the price of oil

    What expectations do you have regarding the price of oil? I remember reading articles in Víctor Morales' blog where the price of a barrel was expected to be more than $ 100, and yet sometimes I have the feeling that the price of a barrel of oil could fall below $ 40. Each person has an opinion and I would like to know yours regarding this issue

    (Anonymous)

    On partying with managers

    Which investor would you party with? Which one not?

    (Ray Dalio)

    About our reading method

    A somewhat curious question, but at the same time useful. How is your reading method? Simple underlining, 3-color underlining, post-its, summaries, etc ... I think that as in all the method is very important.

    (James85bcn)

    Questions about companies and sectors of the August stock exchange consultancy

    About RockRose

    Good morning, after the tremendous rise that Rockrose has had, my portfolio has been quite unbalanced, I have thought of another company where to rebalance the portfolio, but the reality is that I cannot find, nor have I found in my life an opportunity as clear as Rockrose , so I am considering the completely opposite scenario, which is to go all-in at Rockrose. Is it too crazy an idea? Would Iban Reus be proud of me? The more I look at it, I get a much higher valuation than the current price.

    (Anonymous)

    After analyzing Rockrose and seeing that it has more cash on hand than market capitalization, I am asking myself a question: What is the easiest way to find companies that do the same thing? I am referring to companies that have more cash than market cap. Do you know any other than the Rose?

    (Anonymous)

    I've been looking at Rockrose Energy, and a question has arisen. Company CEO Andrew Austin has about 30%. The rest of the managers also have a good amount of shares. With the undervaluation of the company, the cash it has and the cash generation it has, could it happen that the company ceased to be listed on the continuous market? What would happen in that case with the shares we have in our broker? I do not know if it is a real possibility or a newbie question, but I think it has not been raised at any time and the answer would be interesting. Regards

    (Fernando from Fuengirola)

    About Constellation Software

    Hello I love your podcast. I have a question. After much analysis, do you think I'm late for Constellation Software?

    (Miguel from Pontevedra)

    About Consol Energy

    I would be interested to know your opinion about Consol Energy Inc.

    (Peter)

    About Pelatro

    I leave you a question for the office. Does Pelatro still have Paco in his portfolio? I know that Adrian got rid of her.

    (Anonymous from Seville)

    About Prosus

    I'd like to ask you about Prosus, I understand that until recently it was the Naspers subsidiary (called NewCo). I suppose you already know that it will go public in Amsterdam at the beginning of September, I do not know the price range in which it is going to do it and with which ticker so if you know I would appreciate it if you will tell me since I am thinking of buying some shares . The question would be the following:

    If Prosus goes public at a good discount compared to its stake in Tencent, in addition to the rest of the businesses in which it participates. Do you see a good opportunity? Could you get into trouble with the Chinese government for owning such a large stake in Tencent?

    (Alex Nicolau)

    About offshore drillers

    The driller sector (Ensco, Transoceans, Diamond, Shelf Drilling, Maersk's Spin Off ...) carry a huge stick and it seems that among some of the value majors (Paramés, Az, Magallanes ...), they do have positions and it seems that this last quarter they have continued to buy maybe you could expand info.

    (Victor Plagarius)

    About aerospace mining

    How do you see the aerospace mining sector? It seems futuristic but Luxembourg and the US have already taken a first step trying to regulate the market.

    Some companies have already done some test, for example, Planetary Resources that has been acquired by a US company focused on Blockchain called ConsenSys.

    The problem seems to be that there are currently no companies listed. What companies should be targeted?

    (Alex Nicolau)

    About Cameco

    Good afternoon Paco. Congratulations on the Stock Market Consulting. I don't miss any.

    You could in the next comment Cameco (it is carried by AZ Valor), I have it in my portfolio and it has a very large drop and I do not know if you recommend selling or waiting for September.

    (Pau López from Twitter)

    About Special Ingots

    I would like to ask you about the possibility of investing in "Special Ingots", a company that I know from having worked for a time and having a personal connection with it. Given that its main product is steel casting for disc brakes (mainly) and other products related to the automotive industry, how do you see if this company is interesting for the long term?

    (Israel Placer Morillo)