IFB155: June Q&A – Insider Trading and Investing Like Peter Lynch

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Dave (00:36):

All right, folks, we’ll welcome to Investing for Beginners podcast. This is episode 155 tonight. Andrew and I are going to take a moment, answer some listener questions. We got some great questions recently, and we thought we would take a few minutes, which, who are we kidding. It’s going to be longer than a few minutes and answer some of those questions for you guys. So I’m going to go ahead and turn it over to Andrew. He’s going to go ahead and read our first question to us. So Andrew, why don’t you go ahead and take us away, big guy?

Andrew (01:01):

Yeah, let’s do it. So this one is from Alex. He says either question about inside their training metrics, several websites keep track of inside their training, not the illegal kind. And I was wondering what you thought about this qualitative metric. Is there any data showing inside their training as being indicative of a stock’s future performance or anything you’ve noticed from your personal experience? So, Dave, I know you just wrote a blog post about this, coincidentally, so you’d be the man to answer this one.

Dave (01:33):

Okay. Yeah. Thank you. So yeah. Alex. Yeah, that’s a great question. So there is no specific metric that I’m aware of that will tell you that this is a bonus for the company to drastically improve their stock performance because insiders are trading on the company. Generally, if you see an insider, we’re talking about, let’s back up for just a second. So insiders, what are insiders considered any sort of management that’s involved in the company? Most people think of more of the upper-level management, like a CEO, CFOs CEOs, people of that nature, like the C suite kind of people. Still, it also does involve a district manager vice presidents, lower-level managers of that elk. So anybody that has a substantial amount of wealth tied up in the company. Part of the shares that they get for compensation for working for the company.

Dave (02:40):

so Isn’t, it, it doesn’t correlate to, let’s say a private banker, our banker that works at Wells Fargo. That’s investing his 401k in a company. It’s not that it’s more about the stock options that are given to an employee as a form of compensation or pay for the employee. So when they exercise those options, that’s considered insider trading. There, they call it insider trading because they’re insiders. They work for the company. Now the sec takes this be a risk. Seriously. There’s a forum called the form for it’s a sec filing. And the sec takes this extremely seriously. In the fact that insider trading, as Alex was mentioning, has a history of the kind of being on a little bit on the shady side. Back in the day before the sec started taking, I guess, paying attention to this, there was, there would be people that would use their insider information.

Dave (03:37):

If they do that, there was going to be some sort of, let’s say a product that would come out that would revolutionize some particular industry of though that particular person could use their advantage to try to profit from that. And so the sec created this forum for that insiders have to file whenever they buy or sell any of their shares. So what he’s referring to is when these there are several websites out there, including goo focused, a whale wisdom a couple of other ones that I’m blanking on the names of right. Fit that track. Yeah, exactly. Thank you, Finn, business. Great for it as well. They track these kinds of trades. Now a lot of the trades are, I don’t want to say nonsense, but they aren’t consequential. There is going to be a fair amount of trades where you see people that will be selling their shares for, for example, maybe buying a house or putting a kid through college, or maybe they need to pay some taxes.

Dave (04:43):

So you’ll see a fairly regularly, you’ll see a turnover of those shares just because those people are trying to use that money for, for personal things. Whenever you see an insider buying shares of the company, that is a very, very good sign because that means that they think that the company is undervalued and that it is going to grow in value. Now you can’t infer specifically that there is something that, you know, Hey, there’s some great thing coming on board. It just could be that there is something about the company that’s going on that, that they feel bullish about. And especially if you see it at a lower level of management, if you see the CEO of him buying shares of the company, that’s great, of course. Still, it’s not as telling as if you see some mid-level manager, in essence investing all of his worth into the company.

Dave (05:41):

That would be a very, very bullish sign to do because if I was to invest in Andrew and I put all my money in Andrew, I’m banking on Andrew is going to make me a lot of money. So when you’re talking about insider trading, that’s kind of what he, what Alex is referring to. And the best thing that I would recommend you do is to use these websites that I was talking about to help you track the insider trading that happens with a lot of these companies. And if you see people that are starting to load up on shares of the company that they work for, that is an extremely bullish sign. That there’s something either. They believe that the company is going to bounce back, or for example, with everything that happened with the market crashing a couple of months ago, and now it’s already bounced back.

Dave (06:28):

If you’d look back at the last couple of months, I bet you see, I know I saw a lot more insider trading, a lot of more insider buying of those companies during that period. Then you probably saw over the last year or two, just because there wasn’t much as much fluidity and a lot of there wasn’t as much what’s the word I’m looking for volatility as there was just recently. And so that sparked a lot of people buying a lot of the shares of their own company. So there isn’t any real metric per se, that I’m aware of. So that would kind of be my answer to that.

Andrew (07:06):

Yeah. I read through your posts. That’s going live. It should be live by the time this episode is live as well. You, you, you broke down the form four and made it real simple for people who are aware of it and something that I liked that I took out of it funny because I just happened to be researching some stocks today. And I noticed on Finn is as I scroll down that there was some, what seemed significant inside their buying. So, I wanted to look more now. I was like, Oh, I know Dave wrote about this. And so I like what you said about trying to try to take apple apples when you’re looking at how much a particular person is, is, is buying. So speaking to, you know, if, if a middle manager, I think you used as a pretty good example of let’s say a certain level of a person is buying what would equate to their entire salary then that, that, that would be indicative of somebody who’s loading up.

Andrew (08:12):

Another thing you can do, cause I wanted to see, cause the company I was looking at their CEO, it looked like he was buying a lot. It was blocks of hundreds of thousands of dollars at the time I wanted to look at his compensation. So if you look at a company 10 K and you do some sleuthing in there, you can look and see how much the CEO is getting per year. And so when I, when I saw I kind of got disappointed, cause I was like, Oh, this guy makes like $4 million a year. And I’ll know how bullish, you know, $400,000 of the stock is, I guess I’d have to see what his budget looks like if that’s, if that’s a, a big investment for him. So I think, you know, part of that too, is trying to put some context on the numbers and see, you know, just because the numbers seem like a lot. Do you think they are a lot because I, you know, I think, I think any good CEO should put some of his own money in his own company, but if he’s,  loading up, then the, You should be able to spot that? And that can be a  good bullish signal.

Dave (09:11):

Yep. I agree. All right. Let’s move on to the next question. So I, Andrew, I love everything you and Dave are doing to educate individuals who don’t know where to begin. One question I have is if circumstances are similar between two companies in the same industry VTI is strong by strong dividend growth earnings growth, both either aristocrats or not. They have strong management. Is it wise to invest in both for random examples that don’t apply to invest at both Coke slash Pepsi, Apple slash Microsoft GM slash Ford, et cetera, thanks to keeping it up. Brian. So Andrew, what are your thoughts on that?

Andrew (09:52):

I mean, how much time you got, I could go all day. I  like this question. Everybody has their own opinion on it. And a person like Warren buffet recently loaded up on a bunch of airline stocks. You know, he didn’t just buy one, he bought a bunch and then had to sell it cause a current virus. So, you know, it’s not like this brand new concept. There’s a lot of investors who have been doing that. And a lot of investors who do that, where they don’t want to pick an obvious winner. And so they just buy the sector. I think there can be a lot of good that comes out of something like that. I’ll give a more recent example. So for my last issue of the leather for June, I had what I consider the pretty strong macroeconomic trend, which is something I don’t tend to invest based off of usually.

Andrew (10:50):

However, with all the crazy economic developments I’ve been going on, I found what I, what I believe to be something that’s being overlooked and almost, almost not so much like a secular trend or S or a changing in consumer habits, but maybe more so, a difference between perception and reality, and that plays out in certain industries with the stock prices and, and kind of the relative health of those industries. And so I saw an industry where I felt like you could, in my mind, it’d be like shooting fish in a barrel. You could pick any one of these. And they will probably do very, very well. But what I ended up doing was they almost all of the stocks I looked at, and that industry did have a VTI strong buy. That’s, that’s one of the tools I use when I’m evaluating a stock.

Andrew (11:45):

And so, you know, from all the numbers point of view at all look good. And so for this particular situation, I went a little bit deeper. I looked at the cash flow situations, and I looked at the obligations situations. And Dave, we talked a little bit about this offline, and we’ve mentioned it on the podcast too. Still, you know, if you have a time of uncertainty, like the coronavirus, a lot of companies are shoring up a lot of liquidity trying to prepare their balance sheets and trying just to have as much cash on hand as they can have understood that there’s going to be slowdowns for some businesses and potentially periods where revenue is, can get dried up. And so when you look at companies, and you look at the [inaudible], you can see breakdowns, on when certain things are due. So if it’s a retailer and you know, let’s say a retailer has a hundred stores, they might have to make, let’s say $400 million in lease payments.

Andrew (12:45):

And let’s say it’s $2 billion over the next ten years, while inside the 10 K they’re going to layout the Hey, we need to do 400 million in the next 12 months towards lease payments. And then for the next three to five years, let’s say we got to do in our 600 million. And so that’s laid out, and then it also gets laid out for other significant outlays, like debt obligations. If you have some longterm debt, they need to pay off. And you know, what the timeline is for that. So in this environment, as we record this in June of 2020 with as much uncertainty as we’ve seen in recent years, I’m looking at that. I’m looking at what is, what is the runway for powering through a potentially difficult time? And so if I had the choice between one business versus the other, and you know, maybe one has to make all these payments upfront.

Andrew (13:47):

So I think they might struggle a little bit more than another one who is more financially prepared and, or has less to worry about. In the short term, I also looked at cash flows. I looked at how much do these companies tend to invest in capital expenditures and how much do they tend to need to pay year after year after year? And are there sustain their business? Lots of different things to look at. And I guess what you probably don’t want to hear is I think it’s going to depend on every situation that you’re looking at. So in my situation, I had an industry I knew I wanted to invest in at the same time, there were a lot of small competitors, and there wasn’t, I mean, there is a leader, but there wasn’t one who was a dominant leader of this industry. And there were, there’s just a good chunk of them, say five, six, seven, where they’re all out of a decent size and they seem like they all could reasonably take market share from the other.

Andrew (14:48):

And so, you know, something like that, a lot of those things are level. I think looking at numbers in the way I was made a lot of sense there. Now, if you maybe take that approach and you look at a completely different industry, let’s say you were looking at, I don’t know, active apparel, and you have big names like Nike, Lulu lemon, things like that, where, you know, where wearing sweat pants and tights is cool. I don’t think you would necessarily compare competitors in the same way. And so you have to take it on a case by case basis that, you know, what’s the competitive advantage in a certain industry. Does being the number one most dominant player in that industry, do you think that could lead to success or, or, you know, in certain situations that answer might be S in certain situations, the answer might be no.

Andrew (15:50):

Something like a company Pepsi. I know he, he mentioned that he, he didn’t want me to answer about Coke and Pepsi, but historically when Coke dominated over Pepsi, they were a wildly fantastic investment. You can just ask Warren buffet how, how fantastic that investment was. And so in that situation, dominance in that, in that industry, in that period met great things for those investors. And then, you know, he also mentioned GM Ford. I don’t know if you can say if there was a dominant leader there. And so if you’re trying to find a player that may have done better than another, then maybe you’re looking at something other than brand leadership. So that’s the way I see it is that there’s no perfect answer, but there’s a lot of ways you can kind of think about it. And, and, and, you know, the other thing I didn’t even mention as you totally could just buy a group of the big stocks in a certain industry and just play that industry. And that can do fine as well. So, I mean, for me, I’m mostly a large majority of the time I’m trying to pick who I perceive to be the better investment, and I’m going with that. I haven’t up to yet been in a situation where I couldn’t decide between one or the other, but I could see it happening in the future. And maybe sometimes that is the right way to go. If there’s not one clear leader or one clear, better investment of a group that you’re,

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Dave (17:40):

I think that’s a great answer. And something else that I’d like to take on about Andrew’s process that he was talking about. He and I talked a little about this earlier,

Dave (17:50):

And he mentioned to me that he had taken a spreadsheet and kind of lined up all those companies and then kind of analyzed all the different metrics that he was talking about and some of the numbers so that he could put them all together so that they could see how they kind of all lined up. So it would help him make a better choice because sometimes when you look at a return on equity, for example, of a company, it does, if you’re looking at similar interests, he’s like, if you’re looking at the return on equity for Coke versus Pepsi, hopefully, they’re going to be there in the same industry. So it would be apples to apples in a sense, but it’s also good to look at to kind of line things up and make a comparison because then some things start to pop out at you.

Dave (18:34):

If you’re just looking at a couple of numbers and trying to use that to help you make an assessment, it can get a little muddy sometimes when you’re doing that because you think about Apple or Microsoft or GM or Ford or Coca Pepsi, those are all great examples. You think about the style of businesses that they’re in. And although they may, they’re in roughly the same industry; you could argue that they don’t necessarily do the same kinds of things Apple or Microsoft. For example, for me, to me, I think of Apple more like the iPhone, whereas I think of Microsoft more as the cloud type software. And so I don’t think they necessarily compete, even though a lot of people like to put them up against each other and maybe they do compete. And I’m just ignorant, which is possible. But Coca Pepsi, to me, is similar in that they don’t necessarily compete, but they do.

Dave (19:30):

And the beverage part of it is a big deal, but Pepsi has kind of diversified themselves a little bit away and has gone a stack route. And they offer food where I don’t believe Coke has gone down that path. And so just by making those, some of those simple comparisons, you can help maybe help yourself divide and conquer a little bit. But as Andrew said, there’s nothing wrong with investing in both of them. If you think they’re both great companies and you think that there’s a possibility that they over the long term can be, can make you money, then, by all means, slice and dice and do what you need to do with the advent of the ability to be able to buy partial shares of companies. Now, I know that fidelity and ally and Schwab are offering that ability. I believe ally is LA is I know Schwab and fidelity are, so allies do not yet.

Dave (20:28):

Why would they, I mean, good point, good point? Alright, I digress. But fidelity and Schwab both offer the ability to buy partial shares. So if these companies tore you and you had a limited amount of money, they’re there at least those two platforms, there is nothing that would prevent you from being able to buy at least partial shares of both of those companies. And that would be a nice way for you to do a comparison financial aid maybe even to assist, to see how that they, how they perform in your portfolio. So I think that’s a great question, Brian, and I  liked that. So thank you for sharing that with us.

Andrew (21:08):

I liked it too. Let me take us to the next one then. So this one from Mike, he says, hello, Andrew, I stumbled across your YouTube channel, found your content extremely helpful. Thank you for doing what you’re doing. You talked about now. I found one particular video of yours is very interesting. It talks about Peter Lynch and his investing strategy. I already set out my fenders scanner just as you outlined in your video. And I have nine potential stock candidates. Now, to my question, using Peter Lynch’s investing strategy, do I believe he waited for a specific time? Oh, I’m sorry. He says I do believe he waited for specific times. I don’t believe he’s simply purchased the stocks that came upon his scanning. What would, you know, how to further narrow the search and the help would be appreciated? So I know, I guess I know I’m pretty sure Peter has.

Andrew (22:01):

Didn’t do screens. What I tried to do in the video was to make a screen that would kind of try to replicate some of Peter Lynch’s ideas. I also know Peter Lynch had a lot of ideas like somebody who interviewed them had mentioned that he liked to talk a lot. And so maybe that’s why we have so much advice from Peter Lynch just in general because he liked to talk a lot, I guess, if that was, if you were in those shoes, Dave, and, you know, you had nine potential stock candidates from a screener, how would you know what to do from there? If you were trying to follow a sort of the Peter Lynch type approach?

Dave (22:47):

I guess the first thing that I would probably do would be to run them through Peter Lynch was the, I guess he wasn’t necessarily the inventor, but he was the one that popularized a ratio called a peg ratio, the pay ratio. And, what that is, is it’s a combination of a PE ratio and growth. And based on that simple

Dave (23:12):

The ratio that he, he uses, was able to find companies that he felt like was undervalued but had the potential to grow over some time. And that was one of his screeners. So I know that I would run that of those companies through that filter to see how those companies would stack up and that, and that way. And then I would just start working down through the checklists that I have as far as to do I understand what those companies do? So I would take the nine companies and try to figure out what it is that they do. Probably the next thing I would try to do is see if I feel like that they’re undervalued and why are they undervalued? So if you’re running it through those screens, it’s, those are all pretty conservative type screens. Aren’t going to show that a company is probably not being valued fairly.

Dave (24:06):

So I guess the next question I would want to try to determine is this something that’s a value trap, and Andrew’s VTI or his value trap indicator would be a fantastic tool. And I know that I would use that personally. Still, if that’s not something you have available, then it would be just assessing the sales for the company and looking at the company over a long period and just kind of assessing simple things like the revenues. Are they all increasing? Are they flat? Are they stagnant? Are they going down? Are the earnings flat, rising going down? Just kind of, you can see those are things you can easily see. You can go to one of our favorite websites, quick fs.net. And that website will show you ten years’ worth of numbers. And so just by doing that, you can see trends.

Dave (25:00):

So just by scanning through those companies, it would help you determine how those companies are doing. Not all nine are going to match up to your expectations. And there will be companies that will fall off as you’re doing some of that. You’re looking at their dividends, looking at the prices, looking at ratios, like price, to book, price, to earnings, price, to sale, all those kinds of things. And then just once you do that, trying to value the company if you want to use something online, you can easily do that. And then you, I guess, start making assessments on what you feel like is a good company. And other things you could do is ask people around you, do you use this company? Is this something you’re aware of? Do you have any experience with this company and thinking about the things that they, that they sell, and a lot of those things will help you start to kind of narrow down the company, what it is they do and how they’re doing.

Dave (25:59):

Is it undervalued? Is, is it a value trap? Is it a company that’s lagging in earnings for a  long time? You know, those are all things that will start to become far more apparent to you. Once you get past kind of the initial screen of like, Hey, this could be a great company, and I’ll give you an example when I was doing my screening if several years ago I came across GameStop, which turned out to be a bus for me. But as I look through it, I could see some of these trends that I was talking about, but because I quote-unquote, fell in love with the company, I chose to ignore some other signs that could have been potential problems, which turned out to be problems. And so that, in turn, caused me to make a bad choice. And I, you know, I invested some money in a company, and of course, it went down because that’s just what it does, but it was part of my screening process.

Dave (26:53):

But then as I started working through the company, I didn’t, I noticed a few things that I chose to ignore. So I guess my recommendation would be to look at all those things I was suggesting, but then also make just a quick spreadsheet and put some of those things on the spreadsheet. So you can physically see them, or even just write it on a piece of paper. If that, if, if you know, Excel or Google sheets is something you’re not comfortable with, you could easily just write it down as well. And just look at revenue over five years, look at sales or I’m sorry, the costs of goods sold. Look at earnings. Any of those kinds of things that we’ve talked about, all those things, even if you just do it for a short period, will help you see trends. And those will help you start to narrow them down. Because once you have the grouping that you need to start, kind of whittling it down to find the best options for you. And you’re not always going to find five or six companies that you want to invest in right away. You may only find two, and there’s nothing wrong with that. So don’t feel like you have to buy all of them just because they went through a screen and, and they looked good to you initially need to do a little bit of extra due diligence. I guess

Andrew (28:00):

I love that answer. I think everybody should go back and listen to it again—two more times. I think I, I, I do think that people will fall into one of two camps. I think there’ll be at the camp. That’s super like into the screen, into the numbers. And I’ve for sure fall into that camp more often than not. And then the other camp is, is more of you know, how do I feel about this business and, and where do I see it going based on more feelings than numbers. And what I find interesting, what I loved about Peter Lynch, as he was a good blend of both. In my opinion, he talked about, you know, the importance of what he called the peg ratio, the PE ratio, and adding in an element of growth. He talked about balance sheets. He was a numbers guy, but he also talked about how he would get some of his best stock ideas.

Andrew (28:57):

Just like you said, Dave, just from talking to somebody randomly, he mentioned one story where his wife had gone shopping at this place and couldn’t stop raving about it and then ended up being one of his other stock picks. And so I think when you fall on one of these camps, you need to make an effort to kind of bridge that gap a little bit. And so if you, if you’re running a screen and you have a list of nine stocks where you feel that, I think these numbers are good. Well then, maybe you do just need to take some common sense thinking about it. And like Dave said, figure out what, what, what does this company do? And why will it be successful? An example from my cases, I, I don’t remember when it was, it wasn’t too long ago.

Andrew (29:50):

I bought a stock called Tiffany. And so all of the numbers are showing me that this, this thing was, was a great stock and sometimes a good stock or a good company will trade sideways for quite a while. And so a lot of investors and wall street will tend to get impatient with that, which is nice if you’re a value investor, particularly if you’re just stumbling across the company and realize how cheap it is now. You didn’t have to hold it through all those horrible dark times; it’s a great situation to be in. So with a company like Tiffany, it was very, very cheap. The numbers were very, very good. And I knew from just living life, how much status and prestige was around the Tiffany brand. And this is something that had been around or been around for a very long time, just had this procedure around it.

Andrew (30:41):

And so just based off of that and knowing that the jewelry industry is very, very fragmented, extremely segmented out. And there wasn’t a clear leader. You could argue that Tiffany would be one of those. And so, you know, took the plunge. And eventually, another company saw the same value I did. And this is the Louis Vuitton company based overseas, somewhere in Europe. And so they ended up putting an offer in for Tiffany and me, as we record this the offer is pending, but they promised to pay something like $130 a share. And I got in somewhere 80 or 90, somewhere around there. So, you know, sometimes the nut, when the numbers are good, you just need to figure out what’s, what’s the big picture of the company. And can you get behind it? That’s not going to be a hundred percent slam dunk every single time, but when you’re going through a screen, that should be the first thing you do.

Andrew (31:46):

And this shouldn’t be the definitive thing from there. You’ve kind of got your work cut out for you, but it doesn’t need to be this huge long extended process. I think if you’re prudent and use some good principles that hopefully we teach throughout our episodes, staying longterm, invested, being diversified, and trying to pick good businesses that you think will last. And there are good numerical reasons that kind of prove that then, you know, you should do.

Dave (32:16):

Okay. That was a great answer too. You should go back and listen to that as well. All right, moving on to the next question, Andrew, I’ve listened to every podcast you and Dave have put out. And I started over last night. This time around, I plan on focusing on the books and resources you all recommend so I can gain even more knowledge. You all are the sole reason. I’ve started investing along with A hunch that I need to think about retirement. I’m 37 have two daughters married house and two cars. I started with $500 in April, and I added what I could when I can, as a restaurant employee, I dollar-cost average 37 50 every Monday, but I also put any tips I make over $50 into the IRA. The IRA is sitting at $2,000 right now, and we have about $5,000 in assets spread across my wife’s IRA. Kids’ education accounts at a credit union savings account. My question is, I don’t think I’ve heard you answer this specifically. If any of my stocks, a N U E, for example, makes negative earnings for the upcoming earnings report but will have positive earnings for the whole year. Do I sell, I know you’re one of your hard and fast rules sell rules, which was become one of my heart or fast rules is not to hold a company with negative earnings. However, you are referring to the quarterly report annual report, or both sold several companies because I found negative earnings that slipped through the cracks on the quarterly reports, even though quick Fs showed positive earnings throughout the tenure analysis, your guidance on this will be huge for future stock acquisition slash sells. Thank you for everything you all do. And I look forward to hearing the podcast next Thursday, John.

Andrew (33:57):

Okay. So let me do a quick backstory, just so people who are aware of my hard and fast rules, I have a rule that I sell any stock that has negative earnings. The reason behind this is because it seems like way back in the day. Now I did research and just look at basic financials from companies who went bankrupt, and from 2000 to, I think it was 2012, 2013 back then. And so I just wanted to see if I could find any trends. Sure enough. Chances were that there was, there was a greater majority of stocks that had negative earnings than positive earnings when they went bankrupt. And so I know, like in hindsight, that sounds like common sense. If your company is losing money, it could go bankrupt. But I mean, you’d be surprised the mental gymnastics that investors will go through to justify negative earnings, particularly when they don’t understand the whole rest of the picture. But bottom line, you know, when I see something like a lot of the stocks that went bankrupt in the past had negative earnings, then that helps me the formula or rule that I’m not going to hold a company with negative earnings. And so that’s why I have it to answer the question specifically when it comes to negative earnings, I’m talking about the annual report and not the quarterly report. And so, you know, from quarter to quarter, we’ve mentioned on the podcast before the quarterly reports can sometimes be erratic.

Andrew (35:33):

They’re not always audited, and they’re not required to audit. So you could have values that swing, and just certain businesses could be more seasonal than others. You know, you could have a retailer again, that relies on back to school shopping. And even Warren buffet said how their business sees candies for nine months out of the area. It loses money, but for Valentine’s day, it knocks out of the park. So just, you know, the way some business models work, they’re not going to turn a profit for every quarter necessarily. But you know, if over the long term you’re finding that this company is losing money. That’s not a situation I want to be in. And so that’s why I sell. And so if you’re following my heart and fast rules, but a way for the annual report to come out and once you see negative earnings, and if you’re following as I do, then you would sell at that point.

Dave (36:33):

All right, folks, we’ll that is going to wrap up our conversation for this evening. I wanted to thank everybody for taking the time to send us those great questions. It’s a lot of fun for us to answer those questions. And hopefully, you guys got some good guidance and some good suggestions out of all of that. So without any further ado, I’m going to go ahead and sign this off. You guys go out there and invest with a margin of safety emphasis on the safety, have a great week, and we’ll talk to you all next.

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