Two Plus Two Older Archives  

Go Back   Two Plus Two Older Archives > Other Topics > The Stock Market

Reply
 
Thread Tools Display Modes
  #1  
Old 12-01-2005, 06:18 PM
Sniper Sniper is offline
Senior Member
 
Join Date: Jun 2005
Posts: 704
Default BUD - Fools Duel

Bull Case

Bear Case

Bull Rebuttal

Bear Rebuttal

What's your opinion?
Reply With Quote
  #2  
Old 12-01-2005, 06:30 PM
Sniper Sniper is offline
Senior Member
 
Join Date: Jun 2005
Posts: 704
Default Re: BUD - Fools Duel

Links to other recent forum threads on BUD...

The King of Beers

What's up with BUD
Reply With Quote
  #3  
Old 12-01-2005, 07:57 PM
Uglyowl Uglyowl is offline
Member
 
Join Date: Nov 2002
Posts: 66
Default Re: BUD - Fools Duel

Just no growth there, right now there. I would much rather be in Pepsi right now if I wanted a food/beverage company.
Reply With Quote
  #4  
Old 12-01-2005, 10:43 PM
AceHigh AceHigh is offline
Senior Member
 
Join Date: Sep 2002
Location: Pennsylvania
Posts: 1,173
Default Re: BUD - Fools Duel

The beer market is declining (wine/distilled spirits growing), they are the biggest single brewer in America so little chance to grow much. I'm bearish on BUD.
Reply With Quote
  #5  
Old 12-02-2005, 11:32 AM
buffett buffett is offline
Senior Member
 
Join Date: Dec 2004
Location: Graham-and-Doddsville
Posts: 133
Default Re: BUD - Fools Duel

Owl,
What is your estimated range of intrinsic values for BUD & PEP? Where do you expect their IVs to be in 5 years? And combining those two thoughts (and assuming that 5 years from now IV=stock price), what would your expected return be for each investment?
Reply With Quote
  #6  
Old 12-02-2005, 11:35 AM
buffett buffett is offline
Senior Member
 
Join Date: Dec 2004
Location: Graham-and-Doddsville
Posts: 133
Default Re: BUD - Fools Duel

[ QUOTE ]
little chance to grow much

[/ QUOTE ]
[ QUOTE ]
Just no growth there

[/ QUOTE ]
There's that insidiously widespread falsehood again.

I wish I could elaborate my thoughts better than this, but because of my job I'm not allowed to comment on these specific companies.
Reply With Quote
  #7  
Old 12-02-2005, 07:38 PM
Uglyowl Uglyowl is offline
Member
 
Join Date: Nov 2002
Posts: 66
Default Re: BUD - Fools Duel

[ QUOTE ]
[ QUOTE ]
little chance to grow much

[/ QUOTE ]
[ QUOTE ]
Just no growth there

[/ QUOTE ]
There's that insidiously widespread falsehood again.

I wish I could elaborate my thoughts better than this, but because of my job I'm not allowed to comment on these specific companies.

[/ QUOTE ]


I base my comments on both what I see in the real world. What interests me is at a recent dinner at a training seminar I attended there were no Budweiser orders, but there was one Michelob light order. Budweiser used to be the beer of choice and I am afraid that it is no longer "cool" to drink Budweiser. Will the other products pick up the slack? Why worry about that when you can go with a striving company like Pepsi?
Reply With Quote
  #8  
Old 12-02-2005, 10:08 PM
AceHigh AceHigh is offline
Senior Member
 
Join Date: Sep 2002
Location: Pennsylvania
Posts: 1,173
Default Re: BUD - Fools Duel

[ QUOTE ]
[ QUOTE ]
little chance to grow much

[/ QUOTE ]

[ QUOTE ]
Just no growth there

[/ QUOTE ]

There's that insidiously widespread falsehood again.

I wish I could elaborate my thoughts better than this, but because of my job I'm not allowed to comment on these specific companies.


[/ QUOTE ]

What's the point of posting if you aren't going to say anything? Unless you are auditioning for a job as Press Sec. of the U.S.
Reply With Quote
  #9  
Old 12-03-2005, 08:58 AM
Uglyowl Uglyowl is offline
Member
 
Join Date: Nov 2002
Posts: 66
Default Re: BUD - Fools Duel

[ QUOTE ]
Owl,
What is your estimated range of intrinsic values for BUD & PEP? Where do you expect their IVs to be in 5 years? And combining those two thoughts (and assuming that 5 years from now IV=stock price), what would your expected return be for each investment?

[/ QUOTE ]

By the way my investment strategy is very very simple.

I see Pepsi has performed well for the past five year with solid earnings gains and the momentum is continuing unlike Bud who is currently in a rut.

I am not smart enough to figure out if a company is going to turn things around so I search for companies that are priced at a discount that are growing at a reasonable rate.

Do I think Pepsi is super cheap at this moment? No, but in trying to stay diversified it fills a nice niche.

I don't expect to be super rich, but expect to hum along with 10-15% gains/ annually.
Reply With Quote
  #10  
Old 12-03-2005, 04:23 PM
buffett buffett is offline
Senior Member
 
Join Date: Dec 2004
Location: Graham-and-Doddsville
Posts: 133
Default Re: BUD - Fools Duel

[ QUOTE ]
if you aren't going to say anything?

[/ QUOTE ]
Hi, AceHigh
Here is a link to the original post I made that included this phrase. I think it's a big and widespread problem, so I was trying to draw attention to it by saying it in one thread and repeating it in another.
For this specific duo, let's say Stock1 has an intrinsic value of $40 and is currently selling for $35 in the market. In 5 years we expect its intrinsic value to be in the $60-70 range. This represents a growth rate (of intrinsic value) of 8.5-12%, which is pretty good. Ignoring dividends, if we buy it today at $35, we will realize an annualized return of 11.5-15%, even better.
Let's say Stock2 is also selling for $35 but has an intrinsic value of $55. If its intrinsic value grows to be $65-75 five years from now, it will have grown 3.5-6.5% per year. Not too exciting. But if we buy it at $35 and the gap between its stock price and intrinsic value closes, we will have earned between 13-16.5%.
That's all I'm trying to say about BUD vs. PEP. PEP may have higher growth, but that's not enough to imply that its stock is therefore a better buy. We have to also know what its current intrinsic value is, and so far nobody in this thread has given their estimates for the difference between intrinsic value and stock price for these two stocks.
(Cisco, by the way, has had fabulous growth over the last five years. Its revenue and earnings are now much, much higher than they were five years ago. It stock price, though, has declined about 75%.)
Reply With Quote
Reply

Thread Tools
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off

Forum Jump


All times are GMT -4. The time now is 08:49 AM.


Powered by vBulletin® Version 3.8.11
Copyright ©2000 - 2024, vBulletin Solutions Inc.