Jim Tisch - A Friend to Shareholders

In The Office, Steve Carrell's Michael Scott, branch manager at dying paper company Dunder Mifflin, hosts the "Dundies," an annual award ceremony put on to recognize the staff's accomplishments.  In that same spirit, this writer will award a "Friendly" to acknowledge behavior that is beneficial to shareholders, whether it comes from managers, investors, members of the media, or elsewhere.  These prestigious awards will be handed out from time to time, rather than annually, and without the accompanying evening at Chili's, where the not-so-grateful employees of Dunder Mifflin met to receive their awards.

And the award goes to...Jim Tisch, and the rest leadership team at Loews

Loews, a conglomerate controlled by the Tisch family, recently decided to reach out to shareholders in a creative way.  Rather than communicating in one of the usual forms - annual reports, press releases, television interviews etc. - the company released a short graphic novel that illustrates – literally – its story.  Given that the value of Loews lies in several businesses - both wholly owned firms and common stock positions - many would-be shareholders are put off by the complexity.  The graphic work intends to simplify the story. 

The 16-page effort tells the story of its major businesses, which include large stakes in publically traded firms such as insurer CNA and Diamond Offshore.   The piece also mentions that Loews is undervalued.  In fact, readers learn that (at the time of publication) the stock is trading at about $48 per share, yet its "sum of the parts" amount to $50, which doesn't include the value of dozens of high-end hotels, various pipeline properties, or Highmount, an energy exploration and production company.  Readers are reminded that the company has trounced the market over 50 years, returning 16% per year, compared to about half that for major indexes.  In addition, the company re-affirms its core philosophical convictions, including patience, a focus on the downside rather than the upside, and thinking like owners.

Art Spiegelman, surely the world's most influential graphic novelist, dismissed Loews' effort as an artistic failure.  His criticism isn't self-serving, either: the work, starring investigator "Lotta Value," with recurring appearances from "Rich Stockman," will not be confused with Maus, Spiegelman's two-part masterpiece of the graphic novel form.  However, it remains a worthwhile effort at reaching both existing and potential shareholders.  It's possible that Loews' short work will reach most shareholders because of the form, not the content; thanks to the event itself, rather than its subject.  In other words, it may be more about the meta than the message.  Speigelman may appreciate that aspect of it, at least.  In 2011, he released a graphic novel about the original Maus experience - the work's creation, its critical reception, and its implications for his own personal life.  The book's name?  MetaMaus.

Here is other coverage of Jim Tisch, and here is another "Friendly," won by Warren Buffett

Disclaimer: The host of this blog shall not be held responsible or liable for, and indeed expressly disclaims any responsibility or liability for any losses, financial or otherwise, or damages of any nature whatsoever, that may result from or relate to the use of this blog. This disclaimer applies to all material that is posted or published anywhere on this blog.

An Interview with Jim Tisch and Joe Rosenberg of Loews

Loews is a publically traded investment holding company, one that is often likened to Berkshire Hathaway and Leucadia National.  The company has been operating for over 50 years, and has been controlled by the Tisch family.  The excellent Graham and Doddsville newsletter, published by the business school at Columbia University, recently interviewed Loews CEO Jim Tisch and Chief Investment Strategist Joe Rosenberg.

Tisch recounts two investments that lead to excellent returns, one involving buying ships used to transport oil during the OPEC price spikes in the 1970s, the other having to do with offshore oil drilling, back when it was an up-and-coming business.  He has other interesting things to say, including the necessity to treat minority shareholders well even when holding a controlling majority.  After all, when you hold a permanent, say, 60% of a company, neither buying nor selling any shares, the only price appreciation that will come happens among minority shareholders.  If they are treated poorly by the controlling owner, they will sell the stock, decreasing the price.  In addition, he discusses the culture, organizational structure, decision making process and day-to-day habits at Loews; the pros and cons of holding permanent capital; and his preference for US-based companies.

Joe Rosenberg recounts the airline industry in the early 1960s, a rare period of rising profits and stocks (yes, "airlines" and "profits" appear together in the same sentence); he explains how he uses research on riots to help understand the psychology of the market, citing The True Believer: Thoughts on the History of Mass Movements, by Eric Hoffer; and his contention that financial history, and indeed history in general, is not given due attention in business schools.

As usual, the Graham & Doddsville letter lands a superb pair of investors as interviewees, offering very useful information to readers.

Source is here. 

Disclaimer: The host of this blog shall not be held responsible or liable for, and indeed expressly disclaims any responsibility or liability for any losses, financial or otherwise, or damages of any nature whatsoever, that may result from or relate to the use of this blog. This disclaimer applies to all material that is posted or published anywhere on this blog.