Slides from Remick Capital's 2015 annual meeting.
Remick Capital Summary
- Remick Capital advises 70 clients
- ~$8.5m in total assets under management
- No secretary, no marketing
- Individual stocks and bonds
--Rarely, if ever, will I invest accounts in mutual funds
--I invest both long and short
--I don’t sell insurance, do financial plans, do taxes, etc - Investment philosophy summarized here
--Recent market history has reinforced my philosophy
--Outside of my house and emergency fund, all my money is invested alongside clients
My investment philosophy is simple, but not necessarily easy.
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I try to buy good investments cheaply and hold them until I find a much better idea, or they are no longer cheap.
Remick Capital’s Performance Table
Latest is always here
Remick Capital - Current Holdings
Accounts @ Interactive Brokers as of 8/10/2015
- Long only accounts
--96% invested
--4% cash - Long / short accounts
--120% invested
--25% short
--5% cash - Concentration
--Top 10 = ~85% of investments
Remick Capital’s Comments on Performance
- Please see disclosure
--http://www.remickcapital.com/files/perfdisclosure.pdf
--Results not audited
--Performance in 2014 sucked, barely positive, but 2H 2014 was very negative
--Poor performance was discussed extensively in Q4 2014 letter - Key changes made
--Moved to exact unify portfolios across all accounts (one for IRAs, and one for taxable)
--Reduced size of portfolio exposure (both long and short) - Changes *not* made
--General philosophy – still value oriented, independent, contrarian, and concentrated
--Still invest the same way for myself and clients - 2015 is so far looking up
--Long investments doing reasonably well
--Short investments also doing well
Remick Capital - Leucadia National (LUK)
- Misunderstood conglomerate
--I really like the CEO, Chairman, and several of top management
--Shares trade for approximately tangible asset value per share
--Many hidden levers for growth in earnings
--Business is levered to inflation and higher rates - In many cyclical, or somewhat cyclical businesses
--Beef processing, investment banking, plastics, O&G, Forex brokerage, real estate, etc - Some high quality businesses also hidden within
--Commercial mortgage servicing, auto retail / service
--I would also argue the investment banking division is super high quality - Management is aligned with shareholders
--Big share ownership, limited sales throughout history
--Long paper trail of treating outside shareholders fairly (and profitably)
Remick Capital - American International Group (AIG)
- AIG name still tainted from near collapse in 2008
--But now with new management, streamlined businesses, better oversight
--Not a “great” company, but not as bad as the market treats it; I think a “good” franchise - Basic AIG thesis is simple
--No more skeletons in their closet, stock price is held down by historical bias, low rates
--$82 / share in equity value, and nearly $6 / share of earnings power (stock at $64)
--AIG accelerating buybacks this year (run rate of >10% return on current price)
--Upped dividend as well
--I think $90 (10% premium to book) is probably the right price for a business of AIG’s quality
--Income should improve with higher interest rates - We also own some warrants on AIG
--Warrants were granted to Treasury during crisis, later auctioned off
--Bestow the right to buy AIG @ $45 / share in Jan 2021, with a dividend adjustment
--Essentially a leveraged bet on AIG stock (like a stock option)
See full PDF below.
