tag:blogger.com,1999:blog-5389144729834496735.post7444056171359402527..comments2024-03-17T05:15:55.634-04:00Comments on The Brooklyn Investor: The Big Secret, Magic Formula, WisdomTree etc. Unknownnoreply@blogger.comBlogger6125tag:blogger.com,1999:blog-5389144729834496735.post-5180465985564252532012-09-27T15:17:14.039-04:002012-09-27T15:17:14.039-04:00I take that back about PZN; maybe it is cheap now....I take that back about PZN; maybe it is cheap now. Let me take a closer look. Watch out for my next post (which will be PZN). <br />kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-49786380715898479132012-09-27T07:41:23.832-04:002012-09-27T07:41:23.832-04:00Ok, thank you for you answerOk, thank you for you answerBeppaunhttps://www.blogger.com/profile/05026203716442633630noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-51481533294075725762012-09-27T06:58:41.067-04:002012-09-27T06:58:41.067-04:00Hi, yes, I have been following PZN since the IPO s...Hi, yes, I have been following PZN since the IPO so maybe I'll make a post about it. When you look at the company as a whole, just add up the total number of shares including class A an B and it's not so hard (just assume all B is converted to A for analytical purposes). <br /><br />Yes, Pzena really screwed up during the crisis; I read his analysis of FRE and his valuation differential between commodity related stocks and financials etc. <br /><br />I don't think PZN is necessarily cheap or attractive currently (but I'll look at it in a post), but I do like that it is a pure, simple value manager that might have some significant operating leverage if AUM starts to pick up again. And yes, the Windsor news is really good, I think. <br /><br />kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-56456431841964743782012-09-27T06:33:22.187-04:002012-09-27T06:33:22.187-04:00Hi kk, given that Mr. Greenblatt serves as a membe...Hi kk, given that Mr. Greenblatt serves as a member of Pzena (PZN) Board of Directors, could you share your thoughts about the stock? I know, this is probably out from the discussion of this post, but, given that you often talk about asset managers and your analysis are really appreciated, I try …<br /><br />As you'll probably know, Mr. Pzena is a so called 'deep value guy', buying and holding a high conviction group of fundamentally analyzed stocks from the cheapest quintile of the universe in terms of p/b --> to generalize, Greenblatt buy cheap stocks in terms of Ev/Ebit and Pzena buy cheap stocks in terms of P/B. <br /><br />PZN’s aum were impaired by the last crisis: being a pure equity manager and having invested a lot of money in the glorious financials like Fannie_Freddie, Aig, Citigroup, the company’s AUM took a hit so that currently PZN manages $16.4 bln. (8/31/12), coming from the $28.5 bln. (3/31/07) near the ipo date of end of October 07. Recently there was a positive news that Vanguard has added PZN’s strategy to the Windsor fund but from the highs near the IPO (near 22$) the stock is at 5$ (with the A share currently at 10.54 mln from 6.1 mln). <br /><br />So, how do you value this stock?<br />I’m a bit confused by the ‘economic interest’ concept: from the last 10-k “(…) As of December 31, 2011, the holders of Class A common stock (through the Company) and the holders of Class B units of the operating company held approximately 16.3% and 83.7%, respectively, of the economic interests in the operations of the business”. <br />This is the flow chart: http://www.sec.gov/Archives/edgar/data/1399249/000114420412014940/v304912_chrt-flow.jpg <br />... I see this formula is shared by other asset managers (see Calamos (CLMS) for example: http://www.sec.gov/Archives/edgar/data/1299033/000129903312000028/organizationstructure.jpg <br /><br />Thank you, Giuseppe<br /><br />P.s: now Pzena is long HPQ, DELL … the ‘value trap’ that Mr. Chanos is currently short … We’ll see!<br />Beppaunhttps://www.blogger.com/profile/05026203716442633630noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-38418551237951592252012-09-25T17:19:45.258-04:002012-09-25T17:19:45.258-04:00I agree that's it's certainly not cheap on...I agree that's it's certainly not cheap on current metrics (I'll make a post on this later), but I'm not sure it's a great short either. It might be a good short for the short term, though, because of valuation. But they have been growing assets at a pretty hefty pace despite current market conditions. They've had net cash inflows every month or quarter except one even throughout the crisis. On top of that, if these indices do better than a market-cap weighted index (which I suspect they might), there is a chance that they can do well. <br /><br />As for Steinhardt, yeah, he's been in there a while, but WETF is still in the early stages. I think they only started in 2006 or so (before that, WETF was the Individual Investor Inc. or some such Steinberg entity that published the magazine). I don't have a view about Steinberg either way, but if Steinhardt has a significant amount of money in there, he is not one to sit around and be passive about it.<br /><br />I think he would be happy with the asset growth at WETF so far. Anyway, I'll look at this more in my next post...<br />kkhttps://www.blogger.com/profile/06299974418283948333noreply@blogger.comtag:blogger.com,1999:blog-5389144729834496735.post-53496319743322679592012-09-25T16:41:56.931-04:002012-09-25T16:41:56.931-04:00I view WETF as a solid short which should serve as...I view WETF as a solid short which should serve as a hedge to overall market w/ idiosyncratic profit potential - no take-out likely and it's tough to make money in the ETF game unless you're significantly larger. Steinhardt has been in there forever, so I wouldn't view him as providing a 'seal of approval'Anonymousnoreply@blogger.com