In the Full Year of 2020, Altria Group recorded a 98% Return on Equity – way far exceeding the index with 17.17%. In 2021, the achievement is much crazier, the Marlboro maker has a 399% Return on Equity. And it is not a seasonal wonder, Altria has consistently maintained a high level of ROE for a long time. Is its business really that good? Our short post tries to investigate further.Continue reading “Return on Equity: How the number could lie to you”
Adobe is one of the companies that have a wide array of services. From image manipulation to website creation. From video editing to document signings. As investors, sometimes, we difficult to find the key information from Adobe’s earnings report due to its number of services. Through the Business Model Canvas of Adobe, we hope we can provide a clear insight. How much contribution of each segment to revenue? What is the most important product? For those who are in a hurry, you could inspect the figure below to get quick insight.Continue reading “Business Model Canvas of Adobe: The Cloud.”
Why is decision-making important?
Because sometimes it involves money. A lot of.
Decision-making is essential when it involves money. In 2010, Nokia stubbornly decided to use Symbian while all developers join iOS and Android. In 2017, Microsoft adopted a similar approach to challenge the duopoly. The Redmond-based company embedded Windows Phone in its Lumia lineup instead of Android. As you’ve already known, this decision lead to billion of losses.
Microsoft knows that the lack of developer support is the reason why Nokia – Symbian failed. Why did the tech giant still take that approach? It is interesting that under specific situations, people tend to take completely known wrong decisions. And it is not only about corporations. It could also happen at the individual level.Continue reading “Decision-Making: Investing, Business, Career, Life”
Answering the question: Is Nvidia Stock a Buy or Sell? Shortly, we will say that it is “hold”. We even consider adding our holding. Today is a difficult situation for Nvidia due to Biden’s policy to strict further chip export to China. For us, it is a silver lining in the dark cloud. This circumstance offers an attractive price for us to increase our investment in the best chipmaker in the world.Continue reading “Is Nvidia Stock a Buy or Sell? Biden, Game, Datacenter.”
Imagine this situation. You have a $1,000 investment and if this year you gain 50%, your money will be $1,500 – that is $1,000 plus (50%$1,000 = $500). The next year, the economy was bleak and affected your investment, so it lost 50%. Your money is $750, which is derived from $1,500 less (50%$1,500=$750). What is the message from this case? Your brilliance could be wiped out easily by mistakes. Decision-making to avoid mistakes should be a priority.Continue reading “Decision-Making to Avoid Mistakes: Misconception”
Howard Schultz, the CEO of Starbucks, has successfully transformed the coffeemaker into “the third place between your home and your work”. Could this business edge be replicated or competed? This is the central theme of our competitive analysis of Starbucks. We break down its financial report and marketing strategy to find the answer.Continue reading “Competitive Analysis of Starbucks: Behind The Experience”
Here are our key takeaways from the business analysis of Teladoc:
- Teladoc reported 9.6 losses as impairment due to the Livongo acquisition. But it is noncash, an ‘unreal’ loss, and just an assumption.
- Teladoc stock price falls more than 90% from its all-time high at 292 levels (July 2021) to 32 (August 2022). With its advantage as a prime mover, many investors assume that Teladoc is an opportunity.
- We beg to differ. The problem of Teladoc is in its underlying business, not Livongo. Livongo is okay, but the acquisition of Livongo can’t help Teladoc cope with the main problem.
Lets elaborate.Continue reading “Business Analysis of Teladoc: Live Long, Livongo”
This example of the decision-making fallacy gives us a simple conclusion: do not let your former glory ruin your future. Everything will change eventually, we need to adapt.
- After the acquisition of Nokia, Microsoft keeps the Windows (Phone version) as its mobile devices OS. This strategy ends miserably with a $7 billion loss.
- Lionel Messi – maybe the greatest player of all time – relies on his dribbling skill. As the player ages, the sharpness of his play deteriorates significantly.
- Cristiano Ronaldo – Messi’s greatest rival – begins his career as a dribbler, with many tricks, flips flop. But as he ages, he changes his play style. CR7 becomes more passive, waits in the penalty box, and becomes one of the deadliest poachers. He does not dribble much. He becomes much more efficient. His physical peak has been long surpassed, but he keeps delivering prestigious titles for the club and national team.
What do we learn about decision-making here? Let’s elaborate.Continue reading “Example of The Decision-Making Fallacy: From OS to Football”
Key points of Fundamental Analysis of Berkshire Hathaway(BRK):
- Officially, Berkshire Hathaway is transportation, energy, and an insurance company.
- Due to its area coverage and economies of scale, Berkshire’s transportation business enjoys a cost advantage over its competitors.
- Berkshire’s insurance enjoys a switching cost advantage.
- Berkshire’s business is durable, and reliable in the long run, but it is slow. What makes Berkshire’s price rise is probably due to its stock investment and buyback.
From the customer perspective, Disney is representative of a perfect User Experience. It tells a magical story in movies, then actualizes it in the real world through the Theme Park. Our competitive analysis UX (User Experience) tries to identify another company with a similar edge.Continue reading “Competitive Analysis UX: How Mediocre Product Win”