Margin of Safety Investor

Margin of Safety Investor
Contributor since: 2011
Thanks for the feedback.
Because it is selling at such a low price, the beauty of it is that LXK doesn't need to have any growth- it just needs to stabilize its revenue. If it can integrate itself with its clients, thats icing on the cake.
Thanks for the feedback. I'll try to answer your questions here:
1) Hopefully soon. 10-12Bs have been filed. Typically companies will fill in the blanks about a month or so before the actual spin after all approvals, financing, etc is complete.
2)You can read the proxies for the current holdings of ITT stock. In the 10-12Bs, there is some discussion on compensation, it looks like the spins will have a good amount of stock comp and recommended % holdings.
I've been digging through the filings, and will hopefully post an update once the final proportions are announced. I did purchase ITT last week, as I believe the margin of safety I was looking for is now there.
Excellent article. Investors don't use EDGAR enough. While I use Morningstar, GuruFocus, etc for my initial research, nothing beats reading the actual reports.Lots of things are missed when you don't read the 10-K, etc.
Driving store traffic via Caremark was one of the "revenue synergies" that CVS CEO Tom Ryan spoke of when they announced the acquisition. That is one of the advantages that the combined company has over WAG.
I don't value companies based on revenue- profits (specifically free cash flow) are what matters. In a sum of the parts valuation, its difficult to get true FCF by division, so I use EBIT.
Its a fair point that Caremark may not get as high a multiple as ESRX and MHS, but at the current price the market is pricing the Caremark division at around 5x EV/EBIT which seems way too low.
I should have been more clear. They have reduced their share count in the last year- but going back to 2007 the actual shares outstanding increased from 92M to 362M. When I took a second look, I realized this is all caused by stock option issuance- wtd avg diluted shares have remained relatively flat.
M&A deals are actually pretty risky b/c they can fall through. % wise I don't like to invest unless I can get at least 10% absolute which with time frames would be around 20-30% (or more).
You can go to the SEC website and perform an Edgar Search for form SC13 E3 for going private (there will also be some m&a filings in there)
tender offers are usually under TO-I
There are 2 types: SC-TO-I are the straight tender offers. Look for an odd lot tender. Often times they'll be a little higher than 1%.
The other is SC13E-3. These are going private transactions where a company will offer to buy out shareholders with less than say 500 shares. These can be fairly lucrative but have been very scarce the last few months.
I read about Klarman selling VOXX from Insider Monkey- search for VOXX on Seeking Alpha
Not sure if Perelman is much of an asset either- look at Revlon (REV) stock.
About 10 years ago Perelman tried to use MFW to buy Panavision (another company he controlled) for a big premium. Lawsuits flew and he eventually stopped.
When looking at stocks selling below their current asset value it is very rare (especially in this market) to find companies with strong growth and/or wide moats. . However, even a not so great company can be a phenomenal investment at the right price. To echo ARGE's comments, these 3 may be mean reversion candidates in their businesses.
One of the factors I look at when evaluating these types of businesses is if they are or have generated positive cash flow recently and have little to no debt. This helps to find the companies that can make it through difficult times