Winning Entry at Columbia Business School's Pershing Square Challenge

Columbia Business School recently held the annual Pershing Square Challenge.  It is a wonderful event where students at Columbia research and pitch investment ideas to a panel of incredibly distinguished judges.  This year's panel of judges included: Bill Ackman (Pershing Square), AJ Agarwal (Blackstone Group), Craig Effron (Scoggin Capital), Mchael Gerstner (MSD Capital), Paul Hilal (Pershing Square), Philip Hilal (Kingdon Capital), Alex Klabin (Senator Investment Group), Dahlia Loeb (Kensai Asset Management), Mick McGuire (Marcato Capital), Billy Rahm (Centerbridge), Jonathan Schwartz (Seneca Capital Investment Partners), and Whitney Tilson (Kase Capital).  The winning team gets $100k (generously put up by Pershing Square) and the team can then donate or keep that money.

This year's winning presentation was on Hertz (HTZ).  They make the pitch for HTZ being undervalued and worth $36 per share versus approximately $24 where it currently trades (50% upside).  They point to the oligopoly-like nature of the car rental business now that the industry has consolidated as a reason for increasingly attractive economics.  Additionally they believe the divestiture of the rental business would allow HTZ to create significant value.

Here is the detailed 90 slide presentation.

Enjoy.

  Columbia Business School's Pershing Square Challenge

Kerrisdale Capital's Short Thesis onSourcefirce (FIRE)

Kerrisdale Capital is out with their latest short thesis, this one focusing on Sourcefire (FIRE).  Based on their DCF work they think its worth $17 - $26 versus a recent price of $51 or 60% below market.  They do a good job walking through their thesis and the various "red flags" they have identified.

Enjoy. 

  Kerrisdale Capital Short Thesis on Sourcefire (FIRE) by Wall Street Wanderlust

Jeremy Grantham and GMO Capital's Q1'13 Letter

Below please find Jeremy Grantham and GMO Capital's Q1'13 letter.  In the letter Jeremy Grantham gives his usual discussion on the energy and agricultural issues that plague our planet and how it will only get worse.  He doesn't offer too much insight into his thinking on the markets but does make a case for various renewable energies and lays out our existing shortcomings.  Beyond that he goes on to talk about why he thinks natural gas will rise.

Enjoy.

  GMO Capital Q1'13 Letter

Jim Chanos & Bill Nygren on CNBC

Jim Chanos of Kynikos Associates & Bill Nygren of the Oakmark Fund were on CNBC discussing their various positions and ways of thinking. 

In the following video Bill Nygren discusses his long-book and Jim Chanos discusses how he looks for shorts.  Pretty interesting stuff overall. 

Jim Chanos on CNBC

Jim Chanos was on CNBC today discussing a wide range of topics.  In this first video he discusses his short thesis on China and some of his shorts that are China related (steel, mining, etc.). 



Chanos also discloses his largest long positions: Sandisk, Deere, KKR, and VMWare.  He goes onto warn viewers that those longs are mostly to offshet shorts so he would not encourage folks to follow him blindly into some of the investments since they are only getting half of the picture. 

In the next video he goes on to discuss his short positions in Dell and Hewlett-Packard.  He says they have a small long position in Samsung and Apple and are held against some good sized short positions in Dell and Hewlett-Packard.

Jeffrey Ubben of ValueAct Capital on CNBC

Jeffrey Ubben the head of ValueAct Capital was on CNBC yesterday being interviewed about his presence at the 4th Annual Active-Passive Investor Summit. At the conference he disclosed that his firm had taken a $2B stake in Miscrosoft (NASDAQ: MSFT).  In the video Jeffrey walks through his firms strategy of how they are long-term activists effectively partnering with their companies to create value over the long-term.  He talks through his brief thesis on Motorola Solutions (NYSE: MSI) and how he thinks there is a 5-year opportunity to compound at 20%. 




Additionally, here is when CNBC breaks ValueAct's $2B position:

John Taylor on Bloomberg TV

John Taylor of FX Concepts was on Bloomberg TV yesterday talking about gold an bitcoins. He said he was close to being a buyer in gold and thinks we are near a low. He thinks gold will stabalize in the $1,250 - $1,400 range so its in the range as present. John Taylor thinks we have passed the peak and are headed towards a less the awesome second half. He thinks the dollar is the currency to be in for the remainder of the year and the Euro will weaken against the dollar. Enjoy.

Sam Zell on CNBC

Sam Zell was on CNBC yesterday where he was joined by David Rosenberg. They both agreed that insanity is currently engulfing U.S. equities and that its clear that the driver behind the market's rise is not the economy (as indicated by poor ISM reading, jobs numbers, and worse NFIB data) but the Fed proping up the market and debasing the currency. Sam Zell says he is not increasing his position in the stock market and that its not a bad idea to sit on the sidelines right now - he then went on to say the stock market felt like the housing market did in 2006. He makes the analogy stronger by talking about how the markets bullish sentiment and uni-directional pull is similar to what was occuring in housing in 2006. Interesting stuff... enjoy.

Third Point Capital's Q1 2013 Letter to Investors

Daniel Loeb and his Third Point Capital are out with their Q1 2013 letter to investors. In the quarter they returned 9% versus the S&P 500's 10.6%. In the letter they discuss their short position in the Japanese Yen, their position in International Paper (IP), and their position in Liberty Global(LBTYA). As usual the letter is well worth reading. Enjoy.

Third Point Capital - Q1 2013 Letter

Kyle Bass on Bloomberg

Kyle Bass was on Bloomberg today discussing his Japan trade and his thoughts on Gold. I found it interesting that Kyle was perplexed on how low gold is considering. I also like the quote from Kyle on when they were discussing George Soros's recent move away from gold, "George has been a much better investor than I over the years. When you think about the global monetary base, it is north of $70 trillion. All the gold in existence is around $7-8 trillion. There might be $1.2-1.3 trillion of investable gold. At some point in time, I would much rather would own gold than paper. I just don't know when that time is." His whole thesis is gold is another currency and should do well as the global environment prints itself into oblivion. I tend to agree with this sentiment and personally do not view gold as a commodity but merely a reflection on various currencies. Enjoy.

Kyle Bass on CNBC

Kyle Bass was recently on CNBC discussing his opinion on the recent moves by the BoJ. Japan is going through a giant experiment in doubling their monetary base in two years. He thinks its interesting that they abondoned the bank note rule since the BoJ is now monetizing more debt than exists in the system, so the BoJ is buying assets at a rate of 75% of the US Fed but the Japanese economy is only 1/3 the size of the U.S. He thinks its very important to not be long Yen and not be long Japanese equities as the Japanese industrial complex has been hollowed out and he thinks it will end badly. He thinks Japan will start to buy foreign bonds and when they do that it will start an implicit trade war. Japan's declining population, hollowed industry, and living tax increase in 2014 it will likely move nominal GDP higher but this is not the panacea that everyone thinks it will be. He thinks they need to get the Yen/USD to 118-120 in order to hit their GDP targets. He thinks this is a dangerous game and is further protracted by other central banks across the world playing a similar currency war / rate targeting game.

George Soros Recent Interviews

George Soros recently gave two interviews where he discussed his view on the global economic situation. He relates that Europe is that last bastion of orthodoxy and they are racing towards a situation that is similar to what Japan has been trying to escape for the past 25 years. He then goes on to discuss the Japanese situation and gives a warning that the Japanese better watch out since if they are successful in stimulating inflation he is not entirely sure they can stop it once it gets started. As the Yen begins to fall, which it already has, the people in Japan will start to realize that it is liable to continue and that they will quickly try to move their money abroad in order to protect their purchasing power - this exodus can quickly turn the fall of the Yen into an avalanche. INET: CNBC: