You Know What’s Better than Owning an Airline?

An airport.  Airports are natural monopolies. Who wouldn’t like owning a natural monopoly? And unlike other natural monopolies such as local utilities, airports tend to be higher growth assets (air travel is less penetrated than electricity).  At a high level, airports receive revenues from 2 sources: 1) fees on passenger tickets, and 2) commercial revenues generated … Continue reading You Know What’s Better than Owning an Airline?

A Publicly-Traded Airline “Float” Company

The last post, How Airlines Generate Float, compared the similarities between airline mile programs and insurance companies. I argued that airlines are now essentially generating float through their miles programs. Turns out it’s not that original of an idea (as much as I wish it was!) as there are at least two publicly-traded mile program managers in Brazil. Smiles One … Continue reading A Publicly-Traded Airline “Float” Company

What Apple, Google, and Facebook’s Business Models Tell Us About Their Ability to Adapt to the Coming AI-Future

  Judging from market multiples, it’s clear the market is skeptical of Apple’s ability to continue to succeed and has been for many years (currently, 1-yr forward P/E of ~15x despite recent re-rating), while holding limited concern for Google and Facebook (both 1-yr forward at ~26x). This concern is understandable given the ever-changing tech environment and … Continue reading What Apple, Google, and Facebook’s Business Models Tell Us About Their Ability to Adapt to the Coming AI-Future

The Importance of Focusing on Business Models

“Investment is most intelligent when it is most businesslike.” – Benjamin Graham “I am a better investor because I am a businessman and a better businessman because I am an investor.” – Warren Buffett Most investors define themselves along a couple of axes: Technical vs fundamental, value vs growth, long vs (and/or) short, contrarian vs momentum, … Continue reading The Importance of Focusing on Business Models

Berkshire’s Performance Edge that No One Talks About

Over the last half century, Buffett has achieved a marvelous long-term performance record. Many have studied and written about his investments to try to learn how to replicate what he did. I’ve read a lot of those, and you probably have, too. But I’ve always felt that something was missing.  Consensus has generally coalesced around a … Continue reading Berkshire’s Performance Edge that No One Talks About