Goodbye South Dakota… Hello Florida

Goodbye South Dakota... Hello Florida

Growing up I never had a true home.

This wasn't due to a bad home situation or anything like that.  It was because my dad was in the Air Force for 22 years.  And growing up we moved a lot.

From the ages of five to ten  we moved four times.  New Mexico where I was born and don't remember at all.  To Idaho which is beautiful and where all my moms family is.  To the Panama City Beach area of Florida which I loved.  And then we've been in South Dakota for the last 17 years.

I became used to moving.  Even liking it.  And I'm sure this is part of the reason I still want to travel as much as I can when I make some money.

While I love it here in South Dakota growing up I told my friends that I would always move back to Florida some day.

I got the chance last year on three different occasions to visit the state and this only confirmed I still loved the state.  And wanted to move back there when we could.

After I got back from working at the investment newsletter in March my wife started looking for a job as I built up Value Investing Journey and Press On Research.  Because she's a nurse she can work anywhere in the world.

But we were drawn to Florida.  Not just because of my love of the state.  But because my wife's best friend lives in the Tampa area.  So this is where she looked for jobs.

Why else did we look in the Tampa area?

Because where I live there is maybe 100,000 people within 45 minutes of where I live.  Tops.  And the entire state has maybe 600,000 people in it spread our over vast areas.

This means low to no job opportunities in the investment related field.

For reference when I lived in South Florida there were more than eight million people in just the Miami Metro area.  And while the Tampa area isn't as big there are still more than four million people dwarfing the entire state of South Dakota.

This means there are more things to do.  More people to meet.  And more job opportunities than are available here.  Especially in the investment arena.

Because we sold our house in preparation to move to South Florida.  Sold most of our things.  I can work anywhere that has internet.  Our daughters are still young.  And we're already packed and ready to go, this was a chance we couldn't pass up.

While I will always consider South Dakota home.  I hope my young family and I can build another home in the Tampa Bay area.

This plan has been in motion since April/May time period when my wife got hired for a job at a hospital in Tampa.  And she's been down there since June working while we tried to buy a house.

Two houses actually.

Apparently even with great credit its a pain in the ass to buy houses using Wells Fargo.  This led to us losing the first house.

We moved on from this.  Found another house.  Have progressed on buying this one and as we've finished the process Wells Fargo sees that I've got a discrepancy in earnings during 2014.

According to the IRS, in 2014 I worked in Dodge City Kansas where I've never been.  And Jackson Mississippi where I've only been for one day when I was seven or eight.

If you follow me on Twitter you know what happened.  But for those who don't some jack ass has tried to assume my identity.  And because of this ongoing process of proving I am who I really am and didn't work in those places we lost the second house too.

After dealing with all this for the last several months we've decided to rent until we can clear this up.  And found out we got the apartment Monday.

After spending only three of the last 12 months together as a family.  We'll finally be a family again next week.

We're leaving next Monday October 12th.  And should be set up in Tampa some time after that.

This move will change nothing in terms of Value Investing Journey or Press On Research.

As I told Press On Research subscribes when launching the service... Unless something great comes along I'm not looking to get hired.

I'm going to continue writing for you and growing my Amazon and EBay businesses with the long-term goal of raising $5 million to start a holding company.  And begin building my own mini Berkshire Hathaway.

For you Press On Research subscribers there may be a slight delay in the October issue due out October 20th.  But I'll work as hard as I can to make sure this doesn't happen..

What this does mean for the short-term of the blog though is that new content will come to a standstill.  And I'll only be reposting older content like when I was on vacation in Boise until I get settled in Florida.

While I will have limited access to internet while moving please email with any comments, questions, concerns, or just to talk like so many do.  I may not respond fast but I will get back to you when settled.

And if you're in the Tampa area or plan to visit let me know.  I would love to meet some subscribers and/or fellow value investors.

Until next time... This time from Florida...

These are the things I'm working on and will post when I get settled in Florida.

  • Next part of the Steiner Leisure (STNR) case study.  This time valuation.
  • The October Press On Research Issue.
  • An article on neuroplasticity.
  • An update on a Press On Research recommendation.
  • Thanks to Mahesh the case study after STNR will be on Fiat Chrysler.


If you want all updates from this blog including case studies.  To get exclusive content.  Be entered to win prizes.  Get a 50% discount on Press On Research.  Get a few gifts.  And access to other exclusive content.  Make sure to subscribe to Value Investing Journey here.

Steiner Leisure (STNR) Case Study Part 3 – Financials

Steiner Leisure (STNR) Case Study Part 3 - Financials


In Part 1 of this case study I introduced Steiner Leisure (STNR) the company we're looking at in the newest case study and told you why we're looking at it.

In Part 2 of the case study I introduced my preliminary analysis of the company which found some worrisome things about Steiner.  But we needed to find these things in the financials.

This is what today's Part 3 of the case study is about.  Looking at the financials.  And finding out why Steiner's numbers have deteriorated so much in the last year.

I found those answers and a lot more that's important in the 2013 10K, 2014 10K, 2015 proxy, and 2015 2Q 10Q.  And in most cases I would release the 21 pages of notes I took about Steiner exclusive to Value Investing Journey and Press On Research subscribers later today.

But this is such a great learning experience I've got to release the notes below to everyone.  Click on the STNR Notes link below to get the notes.

STNR Notes

My conclusions so far are not good for the company.  But I'll let you come to your own conclusions because you'll learn more doing so.  And if anyone has more private equity experience than I do please let me know what Catterton might be thinking buying Steiner in the comments below.

Next up are valuations for Steiner.


If you want to follow this and all other case studies.  Get exclusive content.  Be entered to win prizes.  Get a 50% discount on Press On Research.  Get a few gifts.  And access to other exclusive content.  Make sure to subscribe to Value Investing Journey here.


Steiner Leisure (STNR) Case Study Part 2

Steiner Leisure (STNR) Case Study Part 2


This case study is a continuation of the Selling The Seas Case Study Part 1.

In part 1 I told you I was doing this case study to see if I made a mistake when analyzing Steiner Leisure (STNR) back in January of 2014 after seeing the company's being bought out.

In early 2014 I liked STNR and thought it had some minor competitive advantages.  But found it overvalued so I passed.

The reason I looked at STNR again was because I saw the company was getting bought out by private equity firm Catterton for $834 million.  And at this I wanted to take a second look.

What I found and detail in the 15 minute video below is shocking.

It shows that not only is STNR more overvalued on a relative basis now then it was in early 2014.  But also that its margins have deteriorated a lot.  Even going negative in the TTM period.  And that book value of the shares has halved.

This has all happened in less than two full years.  And we'll begin to figure out why when looking into the financials in the next part of this case study.

If you want to get the exclusive preliminary analysis notes talked about in the video make sure to subscribe to the Value Investing Journey mailing list for free here.

But this isn't all you get with your free subscription either...

If you want to follow this and all other case studies.  Be entered to win prizes.  Get a 50% discount on Press On Research.  Get a few gifts.  And access to other exclusive content.  Make sure to subscribe to Value Investing Journey here.

Another Six Books Added To Next Prize Pool

Another Six Books Added To Next Prize Pool

I haven't updated this list in a while but today I'm adding another six books to the next prize pool.  This brings the next prize pool up to 14 total books to giveaway so far when the blog reaches 500 subscribers.  Or more than $250 worth of books already.

First, I'll tell you which books added today.  And then at the end of this I'll list all the books in the next prize pool so far.

Steve Jobs By Walter Isaacson

Even though I haven't read this book yet I've heard nothing but great things about it.  And I've already got a copy of this book so when I came across another like new hardcover copy of the book I had to get it to give away to subscribers.

Below is a description of the book from Amazon.

Based on more than forty interviews with Jobs conducted over two years—as well as interviews with more than a hundred family members, friends, adversaries, competitors, and colleagues—Walter Isaacson has written a riveting story of the roller-coaster life and searingly intense personality of a creative entrepreneur whose passion for perfection and ferocious drive revolutionized six industries: personal computers, animated movies, music, phones, tablet computing, and digital publishing.

At a time when America is seeking ways to sustain its innovative edge, and when societies around the world are trying to build digital-age economies, Jobs stands as the ultimate icon of inventiveness and applied imagination. He knew that the best way to create value in the twenty-first century was to connect creativity with technology. He built a company where leaps of the imagination were combined with remarkable feats of engineering.

Although Jobs cooperated with this book, he asked for no control over what was written nor even the right to read it before it was published. He put nothing off-limits. He encouraged the people he knew to speak honestly. And Jobs speaks candidly, sometimes brutally so, about the people he worked with and competed against. His friends, foes, and colleagues provide an unvarnished view of the passions, perfectionism, obsessions, artistry, devilry, and compulsion for control that shaped his approach to business and the innovative products that resulted.

Driven by demons, Jobs could drive those around him to fury and despair. But his personality and products were interrelated, just as Apple’s hardware and software tended to be, as if part of an integrated system. His tale is instructive and cautionary, filled with lessons about innovation, character, leadership, and values.

The House Of Gucci

I saw the subtitle above for the House of Gucci and thought it was hyperbole.  After all this isn't a fiction book about the mafia. It's a business book about how Gucci was started and built.

But the subtitle doesn't go far enough.

The book starts off with the stunning assassination of Maurizio Gucci.  The third generation of the Gucci family to run the company.  And then falls back telling the story of how the company began.

From here for the rest of the book there are two stories within the book told at the same time.  How Gucci was built and run.  And the infighting within the Gucci family.

Including the assassination mentioned above.  Family members sending each other to jail. Alliances and then backstabbing between family members. Nephews and sons fighting uncles and fathers for control of the company and almost destroying the company in the process.

If this sounds a bit like Game of Thrones that's because it is.

I won't ruin any of the twists for you.  But this is a great business and family biography book.

I would give it a 4.5/5.

The Prize: The Epic Quest For Oil, Money, And Power

I've not read this book yet either.  But have heard great things about it too.  And since I've already got a copy I had to get this for you when I came across another like new copy of the book.

Below is a description of the book from Amazon.

Deemed "the best history of oil ever written" by Business Week and with more than 300,000 copies in print, Daniel Yergin’s Pulitzer Prize–winning account of the global pursuit of oil, money, and power has been extensively updated to address the current energy crisis.

Blink: The Power of Thinking Without Thinking

I read this book years ago but came across another copy to give away.

Honestly I don't remember much about the book other than the underlying premise that in most cases the first thought coming to your mind when making a decision is the correct one.

Below are more detailed reviews and descriptions from Amazon.

Blink is about the first two seconds of looking--the decisive glance that knows in an instant. Gladwell, the best-selling author of The Tipping Point, campaigns for snap judgments and mind reading with a gift for translating research into splendid storytelling. Building his case with scenes from a marriage, heart attack triage, speed dating, choking on the golf course, selling cars, and military maneuvers, he persuades readers to think small and focus on the meaning of "thin slices" of behavior. The key is to rely on our "adaptive unconscious"--a 24/7 mental valet--that provides us with instant and sophisticated information to warn of danger, read a stranger, or react to a new idea.

Gladwell includes caveats about leaping to conclusions: marketers can manipulate our first impressions, high arousal moments make us "mind blind," focusing on the wrong cue leaves us vulnerable to "the Warren Harding Effect" (i.e., voting for a handsome but hapless president). In a provocative chapter that exposes the "dark side of blink," he illuminates the failure of rapid cognition in the tragic stakeout and murder of Amadou Diallo in the Bronx. He underlines studies about autism, facial reading and cardio uptick to urge training that enhances high-stakes decision-making. In this brilliant, cage-rattling book, one can only wish for a thicker slice of Gladwell's ideas about what Blink Camp might look like. --Barbara Mackoff --This text refers to the Hardcover edition.

Barbarians At The Gate: The Fall of RJR Nabisco

I've not read this book yet either.  But have heard great things about it as well.  And since I've already got a copy I had to get this for you when I came across another like new copy of the book.

Below are reviews and descriptions of the book from Amazon.

“One of the finest, most compelling accounts of what happened to corporate America and Wall Street in the 1980’s.”
New York Times Book Review

A #1 New York Times bestseller and arguably the best business narrative ever written, Barbarians at the Gate is the classic account of the fall of RJR Nabisco. An enduring masterpiece of investigative journalism by Bryan Burrough and John Helyar, it includes a new afterword by the authors that brings this remarkable story of greed and double-dealings up to date twenty years after the famed deal. The Los Angeles Times calls Barbarians at the Gate, “Superlative.” TheChicago Tribune raves, “It’s hard to imagine a better story...and it’s hard to imagine a better account.” And in an era of spectacular business crashes and federal bailouts, it still stands as a valuable cautionary tale that must be heeded.

The Brain That Changes Itself: Stories of Personal Triumph from the Frontiers of Brain Science

I've talked about neuroplasticity several times on this blog so far.  But until reading this book most of the things I've read have been short articles.  Not entire books including real life stories and examples.

This is a fantastic book.  So great in fact that I'm working on a post specific about some of the stories and examples in this book of the amazing things we can do with our brains.

This book is a 5/5 and has been added to the Recommended Reading and Viewing Page as a MUST READ!!!  It's so good that if I were to write another post about the things that changed my life.  This book would be on it.

More detailed review and information to come about this book soon.

Full list of books in the next prize pool given away when this blog reaches 500 subscribers.  As of now between Press On Research and Value Investing Journey we're at 278 subscribers.

So far this makes 14 great books - worth more than $250 - in the next prize pool.  The winner will get all books and future books added to this prize pool sent to them.  Anywhere in the world at my cost.

All you have to do to get a chance to win all these great books is subscribe for free to the Value Investing Journey mailing list.  Or be a Press On Research subscriber.

But this isn't all you'll get with your free subscription.  You'll also get three free gifts that will help you analyze companies faster.  Some of my exclusive notes.  And a 50% discount on a Press On Research subscription.

To get all these great subscription benefits subscribe here.

September Press On Research Issue Out Today – Back To Business

September Press On Research Issue Out Today - Back To Business

I got in bed last Tuesday night like any normal night.  But all the sudden something popped into my head and I began to panic.

Two weeks leading up to this I told you I was taking some time off to recharge my mental batteries.  And I did.  But I didn't stop doing everything.

I worked on finding the next Press On Research pick and did all the valuations for the pick.  Worked on the case study talked about here.  And read a lot.  But one thing I didn't do was write.

So when I got into bed last Tuesday night realizing that the next issue was due out next week - today - I began to panic because I hadn't written anything yet.  And the issues are longer now.  Most of the time over 30 pages.

For some reason leading up to last Tuesday night I kept thinking I had plenty of time to write the issue because I had two weeks until its release.  I don't know why I thought this.  So the next day I got to work and ended up writing 7300 words - 37 pages - in less than three days.

Yes I had a massive headache from staring at my luminous computer screen doing so much work in such a short amount of time. But it was worth it.

I've spent the rest of the time editing and cutting the issue down. And I think this is the best issue thus far.  But I just need to go over it one more time to check for things like spelling and punctuation errors before its release later today.

But since I'm so happy excited about this pick I wanted to share an exerpt with you below.

Investing In “Sin” At A Huge Discount

By Jason Rivera

Press On Research Volume 1 Issue 6

There’s not much for teenagers and young adults to do in Western South Dakota where I’m from.

Rapid City is the biggest “city” in the area.  And even including the surrounding areas it has a population of maybe 90,000. Tops.

Rapid City is a small beautiful city where most people are nice and polite.  Is a great place to visit in the spring and summer.  But there’s not much to do here.

Combine this with the long winters where you can’t do much outside unless you like skiing, snowboarding, or ice fishing.  And younger people complain of severe boredom here.

But there’s one thing young people can look forward to here once hitting the age of 21.  And this is one thing we have that most in the country don’t.  Gambling.

Welcome To Deadwood

About 30 minutes from where I live is the town Deadwood South Dakota.  Yes, that Deadwood if you’ve seen the HBO TV series.

While Deadwood’s no longer a wild west frontier and gold mining town.  People from all over the world come to the town now to find gold in the towns many casinos.

Because of Mt. Rushmore and the Sturgis Motorcycle Rally.  Both held within 45 minutes from where I live.  Western South Dakota sees between three and four million tourists from all over the world every year.

Here’s a picture of Deadwood during the rally.

And because gambling is outlawed most places in the developed world many of these people also go to Deadwood trying to win fortunes.

Most people don’t win though.  And this is what makes casinos great businesses to own.

Which Casinos Are Best?

The first two times I gambled in Deadwood me and my girlfriend (now wife) went up by ourselves for the day to eat some good food.  Have fun.  And try to win a little money.

And we did all three.

The first two times we went up there we won more than $800 and thought to ourselves man this is great.

But this is how casinos keep you coming back.  With the promise of fun, great food, and easy money.

We’ve gone back dozens of times since and while we still have fun and eat great food.  Every time we’ve gone since we lose money.

I don’t go much anymore because I’ve studied casinos a lot from a psychology and investment perspective.  And I now know the odds are always stacked against the gambler.

But this change of perspective has also given me insights on owning casinos instead of gambling in them

While I don’t own any of the casinos in Deadwood.  I’ve been up there enough to know which do best and why.

If you’ve ever been to a casino you’ve likely felt overwhelmed or lost inside.

Between the buzzers and sirens going off announcing people winning big.  Those same people cheering.  Free alcohol when you’re at a card table or slot machine.  Nonstop talking and lights everywhere.  And the odd layout of the insides of casinos it’s easy to get overwhelmed and lost.

But this assault on our senses is purposeful.  It’s all done to play on our psychology to get us to gamble more.  Even the design of casinos is deliberate.

The maze design of casinos is meant to get you lost so you have to walk around more.  Which makes it more likely you’ll see something you want to play or do.

Have you ever noticed there aren’t any clocks in casinos as well?  This is on purpose too so you don’t know how much time you’ve spent in them.

Do I hold these “tricks” against them?  No because every business uses knowledge of psychology to get us to guy things.  And casinos are businesses just trying to make money like the others.

But which kinds of casinos do best?

The biggest ones with the most amenities.  Best restaurants/eateries.  Most tables and slot machines.  Having the most hotel rooms.  That cluster close to other big casinos do best.


Because the more stuff a casino has for you to do.  The longer you’ll stay in the casino to spending money on food and games.

And the more casinos clustered near each other means the more people can drink without having to walk or drive around while drunk.  Again, the more people drink the more people gamble and spend money.

Almost every small casino has gone out of business or gotten bought by a bigger casino in Deadwood.  And the same holds true in gambling the gambling Mecca’s of Las Vegas and Macau.

The most expensive casino in the world – The Venetian Macau – cost $2.4 billion to build.  And it’s the seventh biggest building in the world in terms of square footage.  Like in many aspects of life bigger is better when it comes to casinos.

I could go on and on but this issue isn’t about the psychology of casinos.  It’s about an investment.  But if this stuff interests you go to the following articles for more information.

So why am I telling you all this?

Because today’s recommendation is a company that owns casinos and hotels.

Not only is this company undervalued by as much as 182%.  But it’s got above average margins.  Is a sub $50 million company with hidden assets on its balance sheet.  And offers us a huge margin of safety.

But before we get to what the company is.  You need to know where it does business...

If you'd like to see what this company is.  And the other five great picks in Press On Research so far.  Make sure to subscribe here for access.  Remember that Value Investing Journey subscribers get a 50% discount on their Press On Research subscription.

So if you want a 50% discount make sure to subscribe to Value Investing Journey here first to get the link.

Fantasy Football Anyone?

Fantasy Football Anyone?

Life isn't all about improvement.  Learning.  Achieving goals.  And working.  Sometimes you need a little friendly competition to stoke the imagination.  And one of my favorite things outside of investing and my family is playing fantasy football.

With the new NFL season about to start my favorite sport is coming back.  And one of my favorite things along with watching professional football is playing fantasy football with family and friends.

I've set up three leagues below for anyone who wants to join.  To do so click on a link below and enter your Yahoo email address.

  1. Value Investing Journey
  2. Value Investing Journey 2
  3. Value Investing Journey 3

I'm taking up a spot in each league.  So as of right there are 27 spots open.

Each league is free to join.  Will autodraft.  And auto arrange draft order to keep things fair for everyone at the start.

If you love a little friendly competition, that may not be all that friendly once competition heats up, join one of the leagues above.

Depending on how many people we get to play there may be prizes/trophies going to the winners as well.

Dole Shareholders Win

Dole Shareholders Win

Yes I said I was taking some time off...  And I am...  But this is too good not to talk about.

Dole shareholders fighting back and winning $148 million.

One of the first companies I analyzed in a real way was Dole Food Inc. (DOLE) which is now a private company.

In 2012 I found the company undervalued by a substantial margin.  It had up to $585 million dollars worth of land and property it could sell to pay off debt.  And that it should undergo a special situation to unlock some of the value within the company.

I even did my first comparison analysis where I put Dole up against its public competition Chiquita, and Fresh Del Monte.

After seeing this.  Comparing the companies.  And deciding I had enough margin of safety I bought the company for myself and the portfolios I manage.

I only held a full position in Dole for 104 days before selling with a 70% gain after Dole announced it was selling its worldwide operations to Japanese company Itochu for $1.2 billion.

I continued to hold a half position in Dole because even after a 70% rise Dole was still undervalued.  But by selling out I was protecting my gains and only risking some of the money I'd already earned.

About a year after this I sold the rest of my Dole position in all the portfolios I manage because the company announced it was taking the company private at a low ball price.  And then started making some crazy decisions.

Below is an unedited excerpt from my book talking about these things.

"As I have been writing, editing, and revising this book, Dole’s Chairman Mr. Murdock has put in an offer to take the company private once again like I thought that he may do so I wanted to write my thoughts on the ridiculous offer being given to Dole shareholders.  I did think that Mr. Murdock may have wanted to take the company private again but what I didn’t expect was the manipulation of the company’s stock price in my opinion before that happened.  Shortly after Dole sold its worldwide operations to Itochu Dole management began to do some very strange things.  The value of its land holdings, that Dole management themselves estimated to be worth around $500 million when they were getting ready to sell their worldwide operations to Itochu, suddenly stated that they thought their land now was worth only around $250 million only a few months later.

This was shocking to me and led to me sell the stock I owned in Dole in my personal portfolio and the portfolios that I manage because I figured that Dole was doing something untoward to try to get the value of its shares down so the company could be taken private again at a cheaper valuation.  One of my followers on Seeking Alpha and I actually talked about this and both came to the same conclusion that something fishy was going on.

After selling my shares in Dole due to the above situation I stopped paying attention to the company all together to concentrate on the research of other companies until it came out that Dole was planning to do a massive buyback of its shares.  I thought this was a very good thing for them to do since I found the company to be very undervalued when writing my second article on them so I started to look into them a little bit again.  Before I could do even minimal research into the new situation at Dole though its management made another very strange decision.  A few days after Dole announced that it was going to buy back $200 million worth of its shares it changed its mind and all of the sudden decided to update its fleet of container ships instead and canceled the proposed share buyback program.

Of course this sent the share price falling and again led me to believe that its management was trying to manipulate the share price lower so that it could be taken private at an unreasonably low valuation.

Unfortunately it turns out that I appear to have been right because a month or two after Dole decided to cancel its proposed share buyback program to instead buy new container ships, which of course sent the share price lower, Mr. Murdock announced that he was putting in an offer to take Dole private at $12 a share.

Mr. Murdock brought Dole public in 2009 at $12.50 a share so this in and of itself is ridiculous since the company is much more financially stable now than it was then due to getting rid of its giant debt load.  In my opinion this entire situation from the changing of the estimated value of its land by 50% shortly after announcing that they thought it was worth $500 million, announcing the proposed $200 million share buyback and then a few days later canceling it, and then Mr. Murdock attempting to take the company private again at an incredibly low valuation should be investigated.  If Dole is allowed to be taken private at $12 a share, which it probably will because Mr. Murdock at my last check still owned 40% of the company, then the company should be investigated for manipulating its stock price.   If the company is taken private for a paltry $12 per share then its remaining shareholders are getting screwed.

If a situation like this happens to a company you own be very careful, trust your research, trust your instincts, and get out of owning the company if you think you need to.  There are a lot of other companies you can spend your time researching and owning rather than spending your precious time and capital having to worry about whether a company’s management is going to screw over shareholders.  Dole's current shareholders are fighting back by suing the company and I wish them good luck because the proposed buyout offer is ridiculously low."

Most of the time this would have ended things.  And shareholders would have no recourse.

But not in this case...

Not only did litigation continue.  But shareholders won a $148 million decision.  Below is quoted from the linked article above.

The billionaire chief executive of Dole Food Co and his top lieutenant must pay $148.2 million of damages to shareholders they shortchanged when the produce company went private in 2013, a Delaware judge ruled on Thursday.

In a decision that may cast a pall on management-led buyouts, Vice Chancellor Travis Laster said Dole Chief Executive David Murdock, 92, and former Chief Operating Officer C. Michael Carter were liable for depressing the stock so that Murdock, who owned 40 percent of Dole, could buy the rest at a lowball price.

The judge said the $1.2 billion buyout undervalued Dole by 17 percent, letting Murdock pay $13.50 per share rather than the $16.24 that Dole was worth.

And further down


Shareholders accused Murdock and Carter of driving down Dole's share price by downplaying the Westlake Village, California-based company's ability to boost profit by cutting costs and buying farms, and canceling a stock buyback.

In his 106-page decision, Laster saw Carter as the main engineer of the scheme, calling him Murdock's "right-hand man" and saying Carter "actually engaged" in fraud.

Still further down

But shareholders called the move a power play. Laster appeared to agree, calling Murdock "an old-school, my-way-or-the-highway controller, fixated on his authority and the power and privileges that came with it."

The judge said Murdock hurt himself during trial testimony, where defense counsel portrayed him as both a "confused old man" and a disengaged CEO.

"By dint of his prodigious wealth and power, he has grown accustomed to deference and fallen into the habit of characterizing events however he wants," Laster wrote.

"That habit serves a witness poorly when he faces a skilled cross-examiner who has contrary documents and testimony," he added.

This is great for Dole's former shareholders.  And should send a message to companies doing terrible things to depress their own stock price.

But all is still not well here...

While the $148 million paid to shareholders is great.  It still undervalues the company by a huge margin.

By my conservative estimates the company was worth somewhere north of $20 a share when taken private.  But the judge in Delaware deemed the company to be worth only $16.24 per share.  Or at least a 19% discount to what I thought Dole was worth.

So while shareholders are getting paid some of this value I stand by what I said in my book in 2013...

If a situation like this happens to a company you own be very careful, trust your research, trust your instincts, and get out of owning the company if you think you need to.  There are a lot of other companies you can spend your time researching and owning rather than spending your precious time and capital having to worry about whether a company’s management is going to screw over shareholders.  Dole's current shareholders are fighting back by suing the company and I wish them good luck because the proposed buyout offer is ridiculously low."

What do you think of this situation?  And does it give you hope for shareholder rights going forward?  Let me know in the comments below.


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