21
Jun
2020

A quick thought on Wirecard

On 18th June Wirecard announced: Wirecard AG’s auditor Ernst & Young GmbH Wirtschaftsprüfungsgesellschaft, Munich, informed Wirecard AG that no sufficient audit evidence could be obtained so far of cash balances on trust accounts to be consolidated in the consolidated financial statements in the amount of EUR 1.9 billion (approximately a quarter of the consolidated balance...
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10
Jun
2020

Recurring revenue and moats

A friend on twitter, Andrew who runs https://www.fundhunter.co/ asked an interesting question: is recurring revenue a “moat” in itself?  That is, do all companies that have recurring revenue / customers who stay for years, have competitive advantages (and by implication report high returns on capital).  After thinking about it for 10 seconds I replied with...
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25
Apr
2020

Analysing uncertainty – TMI

“These days everyone has the same data regarding the present and the same ignorance regarding the future.” Howard Marks   I’m fascinated by this talk on Three Mile Island (TMI) and analysing different stories around what caused the disaster. Please do watch the whole thing. You’ll thank me I promise! Who, or what, was to...
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9
Apr
2020

Sailing into the unknown

Not many things seem obvious at the moment. But one thing that does, is the likelihood that companies will need more cash from shareholders. Historically, the stockmarket was a mechanism for raising capital for uncertain trade ventures into uncharted territory. Starting with the Muscovy Company, the first Joint Stock Company in 1553 expedition round the...
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