Why Leucadia Stock Became A Middling Investment

Leucadia National Corporation was a fantastic investment from its 1979 IPO at a split-adjusted $0.14 per share through early 2008 when it traded at a price of $54 per share. It was 22.8% annual compounding. Warren Buffett described the lead allocators of Leucadia, Joe Steinberg and Ian Cumming, in terms that would suggest he regarded them as investor equals.

I am always interested in these companies that had track records of twenty-percent or greater annual returns but never quite entered the common knowledge of the financial media at large. I am also interested in the fact that the company fell from $54 to the teens in 2019 and has delivered negative returns for … Read the rest of this article!

How IBM Investors Should Feel About The Stock Repurchases

One thing I wanted to do this afternoon is talk about the rare class of company—ExxonMobil, Wal-Mart, and IBM come to mind—that has no choice but to repurchase shares of the company’s stock. If you read much investment commentary on the company, you will walk away with the impression that IBM has no plans for growth or moat-building and is surviving slowly on the use of existing cash flow to retire stock to create an illusion of progress.

To understand why IBM makes the capital allocation decisions that it does, I find it wise to keep IBM’s size in mind. IBM is one of those two or three dozen firms in the world … Read the rest of this article!