Li Lu's Multibagger Stock Checklist (Himalaya Capital)

[@Drachwill]

His Korean Investment was Hyundai Department Store H&S

[@InvestingwithTom]

I thought I heard something about Hyundai, but the car company didn't make much sense - will update the time stamps. Thanks!

[@sebfox2194]

Hyundai bought Boston Dynamics fairly recently. Interesting acquisition.

[@kingzion3032]

@@InvestingwithTom hey Tom can you do a recap of these stocks now. What are they valued at compared to when you did this video

[@sltho]

I think it’s amore pacific. The Indian value investor said lui told him to buy amore and he didn’t and then it went 80x lol

[@BradKaellner]

I'm a simple man. I see Li Lu and I click

[@InvestingwithTom]

I like it

[@susymay7831]

Li Lu! More Li Lu, please: other talks of his, holdings, personal and business stories.

[@InvestingwithTom]

He's the man! Will see what I can do

[@InvestingwithTom]

Are you a Li Lu fan?

[@parthisubramanian]

WHO is he?

[@jjmontgo2]

I am now.

[@hrmt-substack]

Brilliant mind with a great temperament and life story!

[@luispaz6908]

Just saw the documentary yesterday. Omg. Blew my mind! Definitley help understand the man and his conviction.

[@igloballens]

He is a inspiration for life . Real struggle

[@ippolito3166]

Good idea to make a video on Li Lu. He isn't much discussed and I'm interested to know more about him. Thanks

[@InvestingwithTom]

Thanks for watching :)

[@tonyg.3696]

Li Lu is one of the best. I like how he hunts for compounders but also invests in very deep value like Walter Schloss. And very concentrated.

[@InvestingwithTom]

He's the man

[@brianscott5182]

Good work Tom. As you say, Li Lu's backstory back in his birthland is very interesting, and presumably transformative for him. Obviously his tenacity in pushing through when he has high-conviction shows up in his investing success too.

[@InvestingwithTom]

I don't doubt it

[@jonbartel8257]

Good video. Thanks Tom. Li Lu’s presentation at Columbia is a master class. I like the part where he tells the students: if you don’t read value line shame on you - there is gold in it! I was amazed at how poorly prepared the students were. The market cap is listed on the value line page (no calculator needed). That said if I were to apply to Columbia I wouldn’t have a chance of getting admitted. Lol.

[@InvestingwithTom]

If you can figure out a market cap, or divide my 1000 then you're ahead of the class already!

[@sltho]

The cosmetics company is amore pacific. Amore is a smaller conglomerate where the family owns many different types of businesses. So think Samsung Hyundai, etc

[@RockyP-xw8rd]

LI Lu’s scuttlebutt on timberland sounds similar to Pabrai’s approach to Reysas.

[@Neil.Denize]

Awesome vid bro, just knocking over a few degrees and coming out 200k ahead from uni, what an absolute beast of a man. I just watched Li Lu's video, man he is quick at running those numbers especially when you listen to the chat in 1.5 speed lol.

[@InvestingwithTom]

He's a beast - man is a business analyst machine

[@lbuckkshotl]

You mentioned that Li Lu calculated return on capital deployed by taking the property out of the working capital leaving the cash and liquid assets, but I interpreted it as calculating the return on the property + liquid assets and - cash since the property and liquid assets are the capital 'deployed' in the business while the cash is capital 'yet to be deployed'. Would love to hear your thoughts on why I might be wrong :)

[@JakeAllen3]

Great video!

[@Solingen1000]

The issue with Korean companies...there's a lot of em that have negative enterprise value. Huge cash levels, real estate etc...but you as a shareholder will never see it. Koreans run their companies for their family. Not shareholders. At least that's what I hear from some Korean investors

[@andypicken7848]

Thanks Tom. I had heard of him by the munger connection and his name pops up from time to time. Yours was a great little taster. All the best from Birmingham England

[@InvestingwithTom]

Appreciate it!

[@honeyjain6655]

Thank you tom! But most of the value investors also have this question on list Why the hell, good business like this, is trading that cheap ?

[@jjmontgo2]

Excellent summary. Good job.

[@susymay7831]

Yes, mad props on the video!

[@InvestingwithTom]

Glad you liked it!

[@vinaykapoor350]

Thank you for this Tom! Finally got to learn more about Li Lu!

[@InvestingwithTom]

Glad it was helpful!

[@l4k]

What was the debt again?

[@juniorenbundesligagamesfro2027]

Dear Tom, in your Timberland example from Lilu, you are saying that back then, timberland was trading at a 300 mil market cap. You also say a p/e ratio of five was stated, which is five times earnings. Later on, when you calculate the return on the capital calculation, you say the company was earning 100 mill a year. So with the numbers above, this would be a P/E of three?? It would be great to hear from you.

[@RetroRanger]

Thats the thing with screening. The approach with book value and how the REAL return on equity was, just gives us a minor glimpse on how deep those Gurus Go. Another plus on cloning. Because those details matter .

[@InvestingwithTom]

Agreed

[@u105524]

Tom any update on SRG stock will help.. It just keeps going down and I have a big position.. Would love to hear your thoughts

[@InvestingwithTom]

Not too many updates from me. NAV is high, although rising rates may hurt it a bit. And obviously still a big debt payment coming up next year. DYODD 🙂

[@MuhammadAhsan-nn3dx]

Your channel is gold!!! Thanks alot!!!!!!!

[@Money__Matters007]

Nice content

[@yatinmohane8656]

Thanks a lot for this video - super useful. One q - if Timberland was a high quality business (33% return on capital if you include real estate), why was it trading at just 5x P/E? What was his variant insight? :)

[@Nik-up5kg]

Nice video as usual. How does one invest in Himalaya Capital ?

[@Arturg438]

Phill Town has 1 or 2 episodes in his podcast dedicated to Li Lu. I recommend you to listen to them if you want to know more

[@InvestingwithTom]

Heard them all. They’re great 🙂

[@KelechIwuaba]

His list sounds simple but has so much in it

[@InvestingwithTom]

Yeah, he's a beast haha

[@bluegtturbo]

Trouble is there just aren't many companies trading at a pe of 5 and at book value. And if there was, they would be trading at lowly valuations for a good reason.

[@RockyP-xw8rd]

Postal savings Bank of China is p/e of 5 and 50% of book value. It has a payout ratio of 55%, with an ROE on par with Bank of America using much less leverage. It just so happens to be LI Lu’s largest position currently.

[@sebholding]

There is tones of compagnies at 5 times earnings and at book value, however their earning are usualyl expected to decline in the coming years, whereas in the case of Timbaland for example earnings were on the rise and kept increasing

[@Lottemuis]

Thank you Tom, very useful to go through Li Lu's stock analysis ! The Korea stock, I'm wondering whether you can easily find 'reliable' financial data (in annual reports, ..) in these countries ? It's a general question when considering investing in emerging markets (Turkey, South America, etc.) Or do you recommend to first read the book 'Financial Shenanigans' ? :-) One practical remark: It would help me if you could support your storyline with some bullets/ key conclusions shown (next to you) while you are talking though I realize this involves some extra work.

[@wai25wj]

What trade platform do you use ?

[@ryanjohnson3530]

What a great video!!!!

[@InvestingwithTom]

Thank you!

[@styk3500]

Great video, do you know if we could get the value line books here in NZ/Australia ?

[@InvestingwithTom]

I think they have an international equities option, but I think it only track 100ish stocks internationally

[@chunyuenlau56]

Using Li liu's standard of evaluating a stock, Tesla's stock would definitely be a pass, yet (virtually) nobody would deny that today it's a good stock to buy and hold for the long term. But what have I missed?

[@InvestingwithTom]

I think a LOT of people would disagree with that!

[@chunyuenlau56]

@@InvestingwithTom It's just that Cathie Wood recently predicts the stock would go to $3000 from the current $750 by 2025. She has been right when she predicted Tesla would go to $4000 (split-adjusted) some years ago, and everybody laughed at her back then. So I don't know. I know it's over-valued, but Cathie Wood is a smart cookie, and Tesla has a lot going for it at the moment, such as the Tesla 2, AI as a service, battery cells, solar power generation and storage, autonomous driving, robo-taxis etc. So I don't know.

[@chunyuenlau56]

@@InvestingwithTom And also the fact that Li Liu did mention, at the end of the lecture, even if the stock increased by 4 or 5 times, that would be a good result, if you can't get 10x or 20x. Yes I watched the whole lecture.

[@gobele1]

It cannot be priced.

[@honeyjain6655]

@@chunyuenlau56 Then go, sell your house and go all in tesla.

[@cricbuzz1123]

Do you have the link of that talk to share?

[@InvestingwithTom]

In the description :)

[@alemadd]

Where are now these companies with a pe of 2? 😢

[@InvestingwithTom]

Haha I know, right

[@steven3626]

Why Himalaya Capital? He has nothing to do with himalaya. He is even not from himalaya region.

[@Josh-zq7pq]

Just waiting for public access to his fund 😂

[@InvestingwithTom]

Me too - I think I'd be tempted to give him a big chunk of my net worth, and I'll just go fishing

[@Josh-zq7pq]

@@InvestingwithTom tbh the more I think about it, the more I’m leaning to doing this with mr ackman

[@sarahalgdadi5891]

Nice content

[@InvestingwithTom]

Thanks :)