100 episodes

Eric Schleien discusses value investing, rational investment analysis, and vital mental models.

The Intelligent Investing Podcast Eric Schleien

    • Business
    • 4.6 ‚ÄĘ 97 Ratings

Eric Schleien discusses value investing, rational investment analysis, and vital mental models.

    #172: The New Model For Shareholder Activism; The BS Myth Around ‚ÄĚSoft Skills‚ÄĚ; Measuring The Wrong Stuff

    #172: The New Model For Shareholder Activism; The BS Myth Around ‚ÄĚSoft Skills‚ÄĚ; Measuring The Wrong Stuff

    Summary
    In this episode, I break down the current paradigm for shareholder activism, speak to the new model that I invented which is vastly superior both in results and reliability. We discuss the myth of "if it can't be measured, it doesn't exist", the myth around "soft skills", and how people often ask the wrong questions or measure the wrong stuff due to perverted influences by HR departments.

    If you're interested in more discussion of the new model for shareholder activism I developed, see the following links below:

    A New Model For Shareholder Activism (Podcast)
    The Proxy Activism Project
    A New Model For Shareholder Activism (Blog)
    A New Model For Shareholder Activism (YouTube)
    A New Model For Shareholder Activism (Eric Schleien / John King)
    Netflix, Sears, and Tribal Leadership (Eric Schleien / John King)
    How To Keep Large Companies Innovative (Eric Schleien / Scott Forgey)
    Eric Schleien discussing Tribal Leadership
    Eric Schleien discussing Activist Investing
    CBRE Case Study ‚Äď Tribal Leadership
    Comparing Transformational & Transactional Leadership (Eric Schleien)
    Cultural Issues In The Hospital Industry (Eric Schleien)

    New Podcast
    Hey All! I’ve started a second show completely devoted to the field of Ontology which is another huge passion of mine. Please check out The Eric Scheien Podcast which is an ontological podcast where I break down distinctions of human consciousness as an access to enhancing performance.


    HELP OUT THE PODCAST





    If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

    You can subscribe to the podcast on the following platforms:

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    GET IN TOUCH WITH ERIC SCHLEIEN
    Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

    Email: IntelligentInvesting@gmail.com

     

    • 44 min
    #171: Rebuttal To Some Trupanion Hate $TRUP; Discussing the Toxicity Of Twitter $TWTR

    #171: Rebuttal To Some Trupanion Hate $TRUP; Discussing the Toxicity Of Twitter $TWTR

    NEW PODCAST
    Hey All! I’ve started a second show completely devoted to the field of Ontology which is another huge passion of mine. Please check out The Eric Scheien Podcast which is an ontological podcast where I break down distinctions of human consciousness as an access to enhancing performance.

    Summary
    I received this email last year about Trupanion and wanted to address some points made. The entire email is here:

    Hi Eric,

     
    I come in peace as a Chester County native who still very much prefers Wawa over Sheetz, despite living in Pittsburgh. You seemed very open to hearing counterpoints, as per your podcast on TRUP, so I wanted to give you some things to chew on. 
     
    You made two points (I'll summarize): 1) It is justifiable to exclude development expenses from IRR and 2) there are "no accounting shenanigans" going on. 
     
    I would love, then, to hear your thoughts on the following:
     
    Let's first level set with the IRR methodology: the company allocates fixed expenses between Subscription and Other based on their relative revenue contributions. This includes a pro-rata allocation of G&A expenses. 
     
    So let's get into G&A expenses -- what's in there? Typical back office stuff, finance, accounting, etc. But also a couple million bucks of rental income related to subleasing of the company HQ. Per their 2019 10-K: "The change was primarily due to a $3.1 million increase in compensation expenses, a $0.8 million increase in professional service fees, and a $1.5 million increase in depreciation expense mainly due to owning our home office building since August 2018, partially offset by a total of $2.6 million in savings from additional lease income and less rental expense."
     
    The rental income has the effect of reducing reported G&A (i.e. it's netted against expenses). So my first question for you is as follows: if you firmly believe development expenses that aren't related to acquiring new pets are justifiably excluded from IRR calculations, how are you comfortable with several million dollars of sublease income that's clearly not related to acquiring subscription pets benefitting IRR?

     
    Next up is their pet-food VIE. Also from the 10-K: The Company has also entered into a series of agreements to provide ancillary services to the variable interest entity at cost. The Company provided $1.2 million and $1.4 million of these services for the years ended December 31, 2020 and 2019, respectively, which were recorded against its operating expenses.
     
    So TRUP provides back office support to the VIE and reduces its reported opex to account for the compensation for providing the services. 
     
    So the next question is the same as the first: Would you bucket this in line with "development expenses" as being rightly excluded from IRR, or are you OK with the company getting the tailwind from the expense reduction?
     
    Now here's where the situation becomes a bit more nefarious. The VIE has received a total of $9.5 million of funding from TRUP, including $7.0MM of preferred capital and $2.5MM from a line of credit. Think for a minute about what's going on here: the company pushed $9.5MM of cash down to another legal entity, and now reduces its reported OpEx for services provided to the VIE, with the payments being made with money TRUP used to finance the VIE. Money coming out of one pocket and right into the other. 
     
    Third question: Do you think this is an accounting shenanigan?
     
    Lastly, management knows PAC is getting out of hand and pulled a fast one in the first quarter to make it look like they've got things under control. Aren't you the slightest bit curious how they're going to hold PAC at $280 for the balance of this year in an increasingly competitive environment?
     

    Management casually slipped in the following comment during the earnings call: "We expect stock-based compensation to be around $6-$7 million per quarter for the remainder of the year." Coupled with the $8.4 million of SBC already b

    • 18 min
    #170: Westell; A Ben Graham Net-Net; Evan Bleker

    #170: Westell; A Ben Graham Net-Net; Evan Bleker

    NEW PODCAST
    Hey All! I’ve started a second show completely devoted to the field of Ontology which is another huge passion of mine. Please check out The Eric Scheien Podcast which is an ontological podcast where I break down distinctions of human consciousness as an access to enhancing performance.

    NET NET HUNTER
    This episode is sponsored by¬†Net Net Hunter. If you‚Äôre interested in finding high-quality stocks trading at fractions of liquidation value ‚Äď this research service is for you. I personally use this service at my firm to help me research tiny and obscure net-net stocks all around the world. Using¬†Net Net Hunter¬†comes out to way less money than hiring an analyst to do the exact same thing manually. It‚Äôs a service I love and I am proud to be able to offer this service to my listeners. If this is something you‚Äôre interested in, please click¬†here.

    Summary
    Evan Bleker is a professional investor who has built his track record by buying high quality net net stocks. When not researching stocks, he focuses his time on helping small investors learn the strategy so they can earn great returns.

    Evan manages two investing websites: Net Net Hunter and Broken Leg Investing.

    Net Net Hunter
    Complete guide to net net stocks
    Broken Leg Investing
    Deep Value Guide

    Evan discussed Warren Buffett’s net net investing practice during his partnership. Further resources available here:

    You can follow Evan’s portfolio performance here:

    You can sign up for his free newsletter on the Net Net Hunter home page.

     

    Show Notes
    1:06 - What is Westell (WSTL)?
    2:24 - Estimating liquidation value
    3:07 - A simplified approach to finding high quality net-net stocks
    3:55 - The 5G rollout
    5:10 - Potential catalyst
    5:26 - Dark Companies; The new SEC rule
    8:57 - Westell quarterly update


    HELP OUT THE PODCAST





    If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

    You can subscribe to the podcast on the following platforms:

    Apple Podcasts
    Stitcher
    TuneIn
    Spotify
    Podbean
    iHeart Radio
    YouTube




    GET IN TOUCH WITH ERIC SCHLEIEN
    Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

    Email: IntelligentInvesting@gmail.com

    Disclosure: Eric Schleien and some SMA clients of Eric Schleien through GSCM own shares of WSTL. Nothing here is investment advice. Do your own due diligence.  


     

    • 9 min
    #169: Update On Solitron (SODI) - Trey Henninger

    #169: Update On Solitron (SODI) - Trey Henninger

    NEW PODCAST
    Hey All! I’ve started a second show completely devoted to the field of Ontology which is another huge passion of mine. Please check out The Eric Scheien Podcast which is an ontological podcast where I break down distinctions of human consciousness as an access to enhancing performance.

    NET NET HUNTER
    This episode is sponsored by¬†Net Net Hunter. If you‚Äôre interested in finding high-quality stocks trading at fractions of liquidation value ‚Äď this research service is for you. I personally use this service at my firm to help me research tiny and obscure net-net stocks all around the world. Using¬†Net Net Hunter¬†comes out to way less money than hiring an analyst to do the exact same thing manually. It‚Äôs a service I love and I am proud to be able to offer this service to my listeners. If this is something you‚Äôre interested in, please click¬†here.

    Summary
    Today’s interview guest is Trey Henninger where discuss a recent update on Solitron Devices (SODI)

    Trey Henninger runs the blog and podcast, DIY Investing. Trey is a private value investor focused on microcap and dark stocks in the United States. His focus is on high-quality companies with predictable durable earnings where management has skin-in-the-game. Trey runs a concentrated portfolio. By focusing on small companies, Trey hopes to find overlooked compounders at value prices. His favorite opportunities have a market cap below $50 million.

     

    RESOURCES
    My Book on Amazon
    Alex Bossert's VIC writeup on Solitron
    Trey Henninger's Stock Thesis on Solitron


    Connect With Trey Henninger

    Twitter
    Blog
    Spotify
    Apple Podcasts
    YouTube

    HELP OUT THE PODCAST





    If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

    You can subscribe to the podcast on the following platforms:

    Apple Podcasts
    Stitcher
    TuneIn
    Spotify
    Podbean
    iHeart Radio
    YouTube




    GET IN TOUCH WITH ERIC SCHLEIEN
    Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

    Email: IntelligentInvesting@gmail.com

    Disclosure: Eric Schleien and some SMA clients of Eric Schleien through GSCM own shares of SODI. Nothing here is investment advice. Do your own due diligence.  

    • 17 min
    #168: Discussing Uber‚Äės Business Model - Vitaliy Katsenelson

    #168: Discussing Uber‚Äės Business Model - Vitaliy Katsenelson

    Summary
    In this episode, I sit down with Vitaliy Katsenelson of IMA to discuss Uber's business model. We ended up chatting for about an hour and went pretty deep into the weeds around ride-sharing, Uber, and also what the future holds for the industry both in the United States and globally.

    Show Links
    Investor.fm
    Contrarian Edge
    The Six Commandments
    Was Our Money Manager Kidnapped?

    More About Vitaliy Katsenelson
    Vitaliy N. Katsenelson, CFA, is CEO at Investment Management Associates in Denver, Colo.  He is the author of Active Value Investing (Wiley, 2007) and the The Little Book of Sideways Markets (Wiley, December 2010). He runs the blog ContrarianEdge.com.  He writes monthly for Institutional Investor.

    More About Eric Schleien
    To learn more about me, Eric Schleien, check out my personal website and business website. You can also reach out to me on Twitter, Instagram, and LinkedIn.

    If you'd like to read my book, you can find it on Amazon. Reviews are appreciated.

    New Podcast
    Hey All! I’ve started a second show completely devoted to the field of Ontology which is another huge passion of mine. Please check out The Eric Schleien Podcast which is an ontological podcast where I break down distinctions of human consciousness as an access to enhancing performance. To learn more about Eric's work, check out his ontological coaching firm, Transformational Leadership Associates.

    Help Out The Podcast
    If you like The Intelligent Investing Podcast, please consider leaving a rating and review on Apple Podcasts. It takes less than 30 seconds to do and makes a huge difference! You can also join the Facebook page!      

    You can subscribe to the podcast on the following platforms:

    Apple Podcasts
    Stitcher
    TuneIn
    Spotify
    Podbean
    iHeart Radio
    YouTube

    Contact Eric Schleien
    Facebook  |  LinkedIn  | Twitter  | YouTube | GSCM | Instagram

    Email: IntelligentInvesting@gmail.com

     

    • 1 hr
    #167: Quick Idea; Update On LAACO ($LAACZ); Possible Catalyst | Eric Schleien

    #167: Quick Idea; Update On LAACO ($LAACZ); Possible Catalyst | Eric Schleien

    Eric Schleien with a quick update on LAACO (LAACZ)

    • 8 min

Customer Reviews

4.6 out of 5
97 Ratings

97 Ratings

ShadowStock1 ,

Important addition to an investors education

Eric speaks with industry experts, successful micro-cap value investors, company-specific opportunities, special situations, in-depth interviews with known value investors, obscure stocks, investing techniques.

MATT@CYB ,

Intelligently Investing!

Great podcast with amazing featured guests that talk rational investing and the analysis of the markets!

Kurt from Seattle ,

Great Host, Not As Great Guests

Eric is a more talented investor than nearly every guest he brings on. I like the show but I listen to it for his analysis and wish we got more of that. I wish he would raise the bar on some of the guests who really don’t have deep analysis or even come close to his skill level.

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