185- Owner Earnings Fiat Chrysler (FCAU) - Part 1 of 2

InvestED: The Rule #1 Investing Podcast

Phil Town & Danielle Town

Investing, Business

4.6 • 1.6K Ratings

🗓️ 23 October 2018

⏱️ 29 minutes

🔗️ Recording | iTunes | RSS

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Summary

In this week's episode of InvestED, we talk about owner earnings when valuing a business. We take a look at Sears (SHLD) and how looking at owner earnings could have saved shareholders a lot of money. Then we take a look at Fiat Chrysler (FCAU) and try to understand the company by using owner earnings. For show notes and more information visit www.investedpodcast.com Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	Twas a night in November at your pal's Christmas party, when an elf arrives,
0:07.8	oh, with a toffee night latte!
0:10.0	Hey everyone, who wants a Starbucks?
0:14.0	Ooy! Same one for me!
0:16.0	Get the group together for Starbucks festive favorites. It's IRL season.
0:22.0	At a Starbucks near you.
0:25.0	Ahem.
0:26.0	Subject of aid with tea while stocks last. Hey everybody this is Phil Town and this is Phil Town and this is Danielle Town
0:38.6	welcome to the Invested Podcast where we are learning more and more about how to invest like Charlie Munger, Warren Buffett,
0:45.4	and other great investors. This is my daughter Danielle who's... I was going to say like my dad.
0:50.8	Like me. This is really exciting. I think it's really exciting that we're way down the road on this now. And if you've been listening to All these podcasts, you've gotten a pretty good education. So we're going to be fearlessly going in deeper today.
1:04.1	Yeah we've been talking about owner earnings for a few episodes now which is for those of you
1:09.9	coming to this brand new I'll just quickly say is a concept equation calculation
1:16.7	calculation thank you for Warren Buffett that my dad has simplified down for me and we put in our book invested.
1:26.0	And it's in the book, it's straightforward in the book, there are examples in the book, and yet it's still enough of a sort of question mark of a concept because
1:36.2	Buffett put it out there but he didn't really explain it that we've been talking
1:40.4	about it now for a few episodes and I think it's getting it's getting clearer to me so I'm
1:46.6	glad we've been going through this so I'm just a caveat for everybody is that almost certainly Warren and Charlie would say I'm wrong about the formula
1:56.9	because if they could have made the formula any more specific than what they've already done which is basically full of subjective requirements,
2:05.0	to determine things that are cash flow for growth, cash flow for maintenance,
2:10.0	versus, you know, what's going through the cash flow statement all of which is you know
2:16.5	requires a lot deeper understanding of the accounting statements then probably
	...

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