LDVIC 14.84% vs S&P500 23.61% (diff. -8.77%)

LDVIC 14.84% vs FundSmith 24.30% (dif -9.46%)

DISCLOSURE

Investor Psychology : The best investment analyst is going to be right two out of three times (TEMPLETON) If you’re terrific in this business, you’re right six out of 10 (LYNCH) If an investor is right 2 out of 3 times in the investment decisions they make, they would hit the ball so far out of the park, it would be amazing (PABRAI)

Investment Rules (MWO): Investing is a full time job. No if, not buts, no excuses. Buy Berkshire and buy ETFs

Investment Rules (MWO): Investing is a full time job. No if, not buts, no excuses. Buy Berkshire and buy ETFs The best investor is the one that says no to +99% of ideas. ALL THE TIME.

Investment Rules (MWO): Investing is a full time job. No if, not buts, no excuses. Buy Berkshire and buy ETFs The best investor is the one that says no to +99% of ideas. ALL THE TIME. Investing is really simple and not overly complicated. It is mostly down to price.

Investment Rules (MWO): Investing is a full time job. No if, not buts, no excuses. Buy Berkshire and buy ETFs The best investor is the one that says no to +99% of ideas. ALL THE TIME. Investing is really simple and not overly complicated. It is mostly down to price. Look for companies that generate FCF.

T

T

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B

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F

It is mostly down to price. Look for companies that generate FCF. Investment Rules: It is mostly down to price. Look for companies that generate FCF. LOOK AT THE TREND ON THE NUMBER OF SHARES OUTSTANDING

Look for companies that generate FCF. Think about the DEBT levels Investment Rules: Look for companies that generate FCF. Think about the DEBT levels Consider consistent and predictable cash generating businesses

FCF Margin at or above 5%. Minimum 3%. Investment Rules: FCF Margin at or above 5%. Minimum 3%.

Don’t Invest

Don’t Invest

Hertz: MCAP: $1.55 B Share: $18.15 Net debt: ~$3.5B EV: ~$5B

Strategy: Grow revenue by 2019

Refinance some debt and take on more debt Strategy: Grow revenue by 2019 Refinance some debt and take on more debt

Sell cars that Hertz has difficulty disposing of Strategy: Grow revenue by 2019 Take refinance some debt and take on more debt Sell cars that Hertz has difficulty disposing of

EXTREMELY WEAK USED CAR MARKET Headwinds: EXTREMELY WEAK USED CAR MARKET

Headwinds: Management refuses to give guidance Other risks?

Competition AVIS: $2.74B Competition Hertz: $1.55B

Risks?

Risks: Competition Price of petrol Price comparison websites

Risks: Number of airline travellers goes down Debt Purchasing vehicle costs goes up

Shorts

Who owns the stock?

Fair Value: -$30-$40 per share (~80% upside) - +$3B market cap - Depressed FCF $258 mil in FY 2016 – 12x