Professor Glen Arnold

MS International - Owner earnings and intrinsic value estimation

Jan 13 2021 @ 08:53
It’s important to examine MS International (LSE:MSI) with an income metric better than conventional profits after tax, which fails to properly consider the annual cash flows which end up being spent on fixed assets and in working capital items (inventory and receivables in particular) just to support the current strategic market position, and therefore turnover […]

MS International - A valuation using return on net tangible assets

Jan 12 2021 @ 06:39
MS International (LSE:MSI) has a very strong balance sheet and decent profits history.  But what about the relationship between the two?  Given the large amount of net assets devoted to the operating business, does it generate a good rate of return on the money invested? With a Warren Buffett-style investment I expect to hold “forever”.  […]

MS International – Net current asset value and financial stability

Jan 11 2021 @ 06:01
MS International (LSE:MSI) has such a strong balance sheet – including £14m of cash and no debt – that it qualifies for my net current asset value portfolio as well as the Warren Buffett portfolio.  This works if I’m prepared to overlook the fact that its collection of freehold property is allocated not to the […]

MS International – the two pan-European niches

Jan 09 2021 @ 02:00
MS International’s (LSE:MSI) directors have done a very good job of diversifying from guns and forks. In 2010 they paid £3.53m to buy the second half of the Petrol Station Superstructures business they did not own.  And in 2015 they paid €3.4m (£2.6m) for a company which was to become their Branding Division. Both divisions […]

MS International – The Defence Division and the Forging Division

Jan 08 2021 @ 05:32
MS International (LSE:MSI) is comprised of four business.  Today I’ll look at two of them. Tomorrow’s newsletter will cover Petrol Station Superstructures and Corporate Branding. Defence The Defence division mostly makes naval guns, selling to 20 countries, with 300 systems already in place. It also services those guns – a source of continuing revenue in times […]

MS International – I’ve doubled my holdings

Jan 07 2021 @ 09:50
MS International (LSE:MSI), a British engineering company, is selling at a low price relative to its past earnings, its net current asset value and its earnings power. I have bought shares at an average of £1.292 for my Buffett-style portfolio (MCap = £1.292 x 16.5m shares = £21.3m). MS International has two economic franchises: (a) […]

Portfolio performance after a Covid year

Jan 04 2021 @ 05:28
Seven and a half years ago that I left a tenured professorship to concentrate on investment.  Back then the FTSE 100 was around 6,600. The market as a whole has not exactly moved strongly in a positive direction over that time. It is now 6,620 (although there have been dividends of around 3-4% per year). […]

What do value investors do when markets have been lifted high? Warren Buffett's views

Dec 19 2020 @ 02:00
Buffett, in the late 1990s, faced a dilemma common to all investors from time to time (perhaps with smaller sums): he had money to invest, billions in cash or near cash, but “prices were high for both businesses and stocks” (Warren Buffett wrote in his 1997 letter to shareholders). What to do? First, he was […]

Buffett's advice - focus on intrinsic value, not market movements (which are led by quacking ducks)

Dec 18 2020 @ 08:52
It isn’t jumps in stock market prices of his investments that Buffett measures himself by. He focuses on  increases in intrinsic value. A very rough and ready proxy for annual changes in intrinsic value is movements in net worth (book value). For example, in just the twelve months of 1998 Berkshire’s net worth balance sheet […]

SpaceandPeople sold

Dec 10 2020 @ 06:12
SpaceandPeople (LSE:SAL) has been one of my worst investments.  The company works with owners of high footfall spaces such as shopping centres or railway stations to use that space by charging either retailers to set up a stall/unit or promoters to advertise and promote through things like tasting or talking to potential customers. Naturally, it […]
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