Mike, I didn't respond to you on UBB because I was having computer problems. The bottom line on this bank is that I believe it sells at close to adjusted book after factoring in credit for its money management assets and a very conservative reserve for bad debts, which if I recall is something like 6% of the loan portfolio. I get the impression that it is extremely well run, that they do not overpay for acquired assets and that the growth potential in Brazil far exceeds that in the U.S. This offers the opportunity to acquire a core holding without paying a premioum in an industry which in the US you have to pay anywhere from 2-4 times book and this bank has better growth prospects and good management. If I were to place a value on it it would probably be $50, because I wouldn't pay that much for it but I would not be a seller there either because I have few companies that I can see holding for 5 years + that I can afford to own and this and TBR, whic I see as a screaming buy right now, are two of them.
Re: TSEMF sorry that ROn took a hit on it, I believe that two years from now the company will be a lot higher, because rumor has it they turned down $17 for the company, but I chose to purchase DSSI which has a 24% interest in TSEMF and a very promising electric meter reading business as well. It is speculative, but I see the rewards as way outweighing the risks.
BTW I got the annual report on ELAMF. I like what I read seems like a well run company with $2 a share cash, and they earn $1 on the other $5 of my equity. To me that means that my capital at risk earns 20% return on equity. I think I can live with it. <g> and I expect to see this stock at $10
in the next 12 months. |
