RBD - Restaurant Brands

[Placebo]

Macdunk the nine times table is easy, it's the seven times table that is the kicker. I for the life of me still can't tell what seven times six is; or six times seven for that matter. 43? 72? Ach! See, just no good.

GOTT IN HIMMELL EST EIN ENGLANDER SCHWEINHUNT!!!!

Phaedrus don't take the bait. They're just wallowing in their own misery. I have a couple of kids who react the same way when you point out the obviousness of their faults... the stuff they already know. Nobody wants you to point to that great fat pimple on the end of their nose. But sometimes it needs to be done.

Don't let the b*stards grind you down. Fight the good fight!!

Kia kaha bro! Be shtrong!!

[duncan macgregor]

HIAWATHA, You are not that stupid that you dont realize that the sharemarket is an on going auction with us all in competition, buying and selling. If that is not competing then what is?. I must admit that some of the lesser people will compete for shares in RBD or TEL where some of the more astute investors will stand and watch. Yhe sillier some people are, the easier it is for others so keep investing dont let me put you off. Macdunk

[ratkin]

What are the stats on traders, 90% go broke? Im sure the long term investors do better as a group. Even the ones who invest in the likes of RBD.

look at all the hundreds of books on trading , if these people were any good then they wouldnt have to make their money as authors.
The big TA con is kept going by the system sellers , the brokers who thrive on the high number of commisions they recieve , the data sellers , the software sellers and all the other hangers on who espouse trading but only seem to make money from talking about it.

As soon as times turn tough all the trading converts will lose money , their systems and software will end up on trade me for a few dollars. Meanwhile people will still be eating kfc and the value of RBD will eventually be realised

An amusing little thread

[Snoopy]

quote:Originally posted by ratkin


The investor would have largely avoided all the companies which were grossly overvalued and any mistakes would have been relatively harmless (like rbd).

Traders also make the mistake of thinking that investors go down with a sinking ship. This is not necessarily the case at all. As soon as the fundamentals of a company deteriorate or the price moves far above the companies value then the skilled investor will take profits.

As long as the investor selects stocks wisely, exits if the fundamentals deteriorate, ignores short term noise and doom and gloom merchants, stays invested and reinvests dividends etc, then that investor will beat 90% of traders in the long term, will of spent far less time and energy on the markets.

In an effort to bring this thread back on topic...

I think all of you guys are missing the point. Investing is not about being 'right' or 'wrong' or 'buying in if things are going well' or 'exiting if the fundamentals deteriorate'.

Investing is a case of constantly comparing 'price' which is what the market is offering with 'value' which is what it is you are getting.
If RBD announces an underlying earnings deterioration of 20% and the price falls by 30%, generally this is a signal to 'buy'. If OTOH the price only falls 10% in response to a 20% earnings downgrade that might be a signal to sell.

We know that the market in the short term has a tendency to over-react to news, both good and bad. So I never seek to buy at 'fair value', always 'below fair value'. Likewise I never seek to sell at 'fair value', always 'above fair value'.

I regard RBD as an excellent investment candidate because the potential RBD investor (and that means everyone reading this) is more sophisticated than the typical RBD consumer. I'll bet the typical investor would spend twice as many nights out at restaurants with waiters than they would at their local 'KFC and McDonalds', assuming they have ever been into the doors of the latter at all. Thus the investor sees food like KFC and Pizza Hut as 'rubbish' all the time assuming their own sophisticated tastes are 'right' and anyone who eats let alone invests in a company like RBD as a fool.

I have some news for those sophisticates out there. KFC and PH do not care what you think of their food because *you are not their target market*! And just because you are not their target market that doesn't mean that KFC and PH cannot operate very effectively by zeroing in on an entirely different target market of customers. I believe the principal reason that RBD has been 'cheap' since 1999 is because most potential investors cannot relate to what RBD are doing and see the whole operation as somehow 'beneath them' and 'not worthy of their investment consideration'.

Fortunately I don't suffer from such 'investment pretentiousness' and see RBD for what it is: an average company at a rock bottom price.

There is no doubt RBD management have made mistakes. But they have also got several things right (like the Eagle Boys takeover, selling out of their Pizza Hut real estate before they quit the sites and the KFC makeovers that have been widely praised by franchise parent YUM). IMO the assumption that RBD is simply an overpaid flock of bungling executives who will never get anything right is selling the company short.

Probably the worst thing about 'the RBD investment experience' for me has been, with hindsight, the float was overpriced given what we know now about the business conditions of the ensuing ten years. If the shares had been floated at $1.30ish (where the shares have spent more of their trading life than any other price band) I believe the market perception of RBD would be quite different to what it is now.

Personally, I believe that every purchase I have made of RBD shares has been val

[winner69]

Snoopy ..... interesting that it comes across that you use the term 'investor' like you would use the term 'owner'

Do you feel like an 'owner' of RBD?

I see that nearly 100% of the shares in RBD change hands in the last year - would seem to suggest that there are very few 'owners' of RBD - 'owners' used in the context that generally most people 'own' their dog for life.

But them we don't really want to get into a discussion into who 'owns' RBD do we.

[Balance]

Snoopy makes a fair point and a good point.

When just about everyone is negative on a stock, it is time to take a serious look. The Warehouse in the last two years is a great case in point. Everyone got so negative on it that the shares traded as low as $3.20 and was still $3.50 last year.

I am not so sure that RBD has sufficient gloom and doom built into the share price yet however. It needs a few punters predicting that it is going to go down to 25 cents and plenty more selling.

Phaedrus, would TA have been useful in picking the number of trading opportunities which RBD has represented in the last 2 years?

[tim23]

Good post Snoopy - now if there is another bid for the company say at $1.50 on Monday - that makes you smart and Duncan (who is never wrong)not so smart!

[hairdresser]

100% up on the NZ market this year is good IMO. This is about making money not friends. Go hard MacGregor.

[Halebop]

quote:Originally posted by Snoopy

I think all of you guys are missing the point. Investing is not about being 'right' or 'wrong' or 'buying in if things are going well' or 'exiting if the fundamentals deteriorate'.

Investing is a case of constantly comparing 'price' which is what the market is offering with 'value' which is what it is you are getting.
If RBD announces an underlying earnings deterioration of 20% and the price falls by 30%, generally this is a signal to 'buy'. If OTOH the price only falls 10% in response to a 20% earnings downgrade that might be a signal to sell.

You are describing one very valid type of value investing, which is one valid type of investing. There are however dozens of other approaches.

Irrespective of how the investment is approached - it must deliver several key points...

1. Profits
2. Profits that reflect the risks taken
3. Profits that exceed the opportunity cost
4. Profits that exceed relevant benchmarks

quote:Originally posted by Snoopy

We know that the market in the short term has a tendency to over-react to news, both good and bad. So I never seek to buy at 'fair value', always 'below fair value'. Likewise I never seek to sell at 'fair value', always 'above fair value'.

This is also what a TA approach seeks to do. It just lets the market set fair value.

But then there is FA and there is FA. Over the last few years I've had a negative view on RBD using qualitative FA. So far both the market and RBD's operational results agree with me. So some part of the "determine fair value" approach must be subjective and subject to bias and flaw, because we both have very different perspectives on the merits of the very same company.

quote:Originally posted by Snoopy

I regard RBD as an excellent investment candidate because the potential RBD investor (and that means everyone reading this) is more sophisticated than the typical RBD consumer. I'll bet the typical investor would spend twice as many nights out at restaurants with waiters than they would at their local 'KFC and McDonalds', assuming they have ever been into the doors of the latter at all. Thus the investor sees food like KFC and Pizza Hut as 'rubbish' all the time assuming their own sophisticated tastes are 'right' and anyone who eats let alone invests in a company like RBD as a fool.

Thanks for putting me in with the sophisticates! At least we agree on something.

I can however see RBD as serving rubbish food but see their business model as profitable. What I can't see is RBD delivering rubbish service standards, returns and strategy and somehow delivering outsized long term returns.

[quote]quote:Originally posted by Snoopy

I have some news for those sophisticates out there. KFC and PH do not care what you think of their food because *you are not their target market*! And just because you are not their target market that doesn't mean that KFC and PH cannot operate very effectively by zeroing in on an entirely different target market of customers. I believe the principal reason that RBD has been 'cheap' since 1999 is because most potential investors cannot relate to what RBD are doing and see the whole operation as somehow 'beneath them' and 'not worthy of their investment consideration'.

Fortunately I don't suffer from such 'i

[Mick100]

quote:Originally posted by hairdresser

100% up on the NZ market this year is good IMO. This is about making money not friends. Go hard MacGregor.

You mean to say you actually believe Macgregor - Your kidding aren't you hairdresser? Three out of his four hot nickle stocks have tanked over the past 2 months and the forth one has gone sideways.
Yet he tells us that his portfolio has gone from being 70% up at the beginning of may to being 100% up now - while all the stocks he's holding have tanked! On top of that, I saw on another thread, macgregor accused MVT of telling porkies about his shareholdings in telecom.Whose been telling porkies Macgregor?
.