Very nice. Glad you made a tidy profit from it.

Too bad you didn’t hang on to ZRBA until today. Being lethargic and not selling right away gave me a nice profit on it haha. Keep up the good work, I love your site!

Not sure whether they have any other strategies up their sleeve though.

Didn’t mean to send that message twice.

Curious to find out what the other strategic opportunity is.

Keep up with the great work on the site!!!

Ryan

No date set as it was just recently filed. Waiting for the updated filing.

In regards to ZRBA when is the 250-1 split happening. I read through the SEC files and could not find a date.

Thank you,

Here is a link of what the current stock valuation spreadsheet looks like.
http://www.scribd.com/doc/12805064/kostocksample-analysis-report-intrinsic-value

No seriously, I appreciate you even sharing your picks. I’ll be doing some reading but the numbers look good and the business, like you said, is very simple.

My friend also asked me the same question.
“Where do you find all these ideas?”

The answer again is something you’ve heard a million times.
Read, read, read.

What helps is that I run companies through my spreadsheet, so if I hear of a ticker, or I see a list of 32 value stock ideas, then I go through each ticker on the various spreadsheets I have and filter them out.

I used to go through 100 or more ideas within 20mins and then from there I’ll go over the ones that look good again.

I get my ideas from the blogs in the links section but I especially like free newsletters. Below are a some lists and places I get ideas.

Manual of Ideas
ShadowStock
WaxInk
Forbes 200 Best Small Companies
Fortune 40 Stocks to Retire On
Magic Formula Investing
Value Investors Club
Fool Caps

Hope you can pick from that

If you go through their annual reports you’ll find a lot of information regarding the business.

I won’t be going into too much detail on these picks as these are my pocket aces. I’m trying to keep it quiet while I wait to get a full position so I’ll only leave information in the comments.

On the macro side, radio stocks are very easy to understand. Their business model simply focuses on ad revenue. Play ads, get paid. Easy as that.

What a lot of people don’t see or accept is that terrestrial radio will not go away. I personally will never pay for satellite radio and neither will most of my friends.

So say you listen to the radio in your car. You’ve got 6 or up to 8 channels in a car and you’re going to set it on a preset. How often do you change those presets? Once you find a good radio station, I’m sure you never change right?

You listen to the morning drive and most probably the same station again during the commute home.

So content is what makes radio “sticky” and I can live with the ads, which is where the revenue comes in.

From a macro view, ad revenues drop significantly with the economy. It’s cyclical, yet predictable, and right now we are in a down cycle.

Notice how during the Cash for Clunkers week, car ads started to come back on the radio after a long hiatus? That’s what’s going to happen when the economy lifts up and businesses start to spend again.

I’m sure you get the idea about why I like radio at the moment.

As for fundamentals, look at their free cash flows, whether their writedowns will affect cash, whether cash can pay off debt and you’ll see that the problem with radio stocks isn’t a solvency issue. They had a liquidity issue as the debt they needed to roll over came due during one of the worst years to receive financing.

Chris

Could you explain your Radio picks a little more? Much appreciated!

How do I isolate sound research and decision making?… hmmm…
A big help is that I publicly publish my entire thought and decision process on this blog for everyone to see and scrutinize. If I don’t know what I’m talking about or not confident in a decision, I don’t buy.

As Buffett says, “if I’m going to be wrong, I want to be able to explain why”.

As much as my performance is great this year, I don’t expect it to be anywhere close next year. I’ve been able to take advantage of huge market inefficiencies on a regular basis this past year which is points to the performance stats but with opportunities drying up it will be a different story next year.

And my portfolio is by no means a long term buy and hold type of portfolio. I have positions where I have to sell quickly if things turn the other way. Definitely have to be updated on what I own.

Rather, my strategy of old school fundamental analysis, crunching numbers and reading should be a very good strategy for the long term. It’s something that has been known for decades but seemingly lost in the world of fast media and instant Yahoo/Google numbers.

I find stocks randomly, either just entering tickers I hear or see and then following a daisy chain effect from there. It’s funny how I’ve been able to find some good stuff like that.
Another way is I follow other people who have lists of similar style stocks. Some bloggers already provide results from screens and I just go through them one at a time. The URL’s are in the links section at the top.

With the radio stocks, I don’t see much risk as the margin of safety is so huge. They are heavily leveraged but that has been the characteristic of the radio industry for quite some time and I doubt it will change.

While the fundamental metrics do not meet Graham or Buffett’s standards, radio stocks like other capex heavy industries should be valued on cash flows.
Right now, all of these companies are turning over positive cash flow and able to meet their debt obligations.

We’ll see what September brings but I’m looking to see what to average down on or buy.
Found a net net that looks to be good going forward. We’ll see whether I can buy it at a price I’m hoping for.

good luck in sept and keep up the great work
chris