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Strategies & Market Trends : Fundamental Value Investing

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To: E_K_S who wrote (3253)	8/10/2013 4:10:45 PM
From: Spekulatius	Read Replies (1) of 4719

The only tech company that I own is ORCL. It has many Buffet stock attributes like strong FCF, excellent balance sheet with net cash. PE is low and it's an owner operator stock with Larry Ellison owning a lot of shares. I also like it better than Buffett's IBM pick. I don't see why we need to replace AAPL with another tech company though. I do have another proposal - since the nominal value of the portfolio is small, why not go with a small cap company like LAACZ. This is a real estate partnership with a long track record. North of 80$ in operating earnings this year and if you add in depreciation the FFO (which is what Reits are measuring themselves) is 120$/share. Currently, units are going for 1135$/unit. Debt/equity ratio is ~0.2, so leverage is very low compared to most REITs. So, essentially with LAACZ you are buying a well run RE business with low leverage, a 5% distribution yield at a >30% discount to comparable REITS. Disclosure:I have more than 10% of my portfolio in LAACZ. Last quarters financials: otciq.com

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