저자: LiLu · 외국인
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Li Lu의 Timberland 투자 사례를 다룬 교육용 영상으로, 향후 1~3개월 가격 예측이나 매매 권유는 없음. 핵심 주장: 1998년 Timberland 투자는 가치투자의 교과서적 사례로, 기업 질의 판단과 경영진 신뢰 확인이 핵심. 투자 논리: 주가순자산비율(PBR) 약 1배, 시가총액 약 3억 달러, 장부가 약 3억 달러로 하방 보호가 있었음. 운전자본 약 2.75억 달러, 현금성 자산 약 2억 달러 및 부동산 약 1억 달러로 장부가 구성이 깨끗하다고 평가. 수익성 근거: 영업이익 약 1억 달러, 투하자본 약 2억 달러로 자본수익률(ROCE) 약 50%. 주가수익비율(PER) 약 5~6배에서 매입. 리스크 및 저평가 이유: 아시아 금융위기 여파로 신발업종 전반이 저평가, 증권사 애널리스트 커버리지 0. 내부자 지분 약 40%, 의결권 약 98%, 주주소송 다수 존재. 경영진 검증: 법원 서류 전부 검토, 가족 지역사회 방문, 자녀 이사회 참여 등으로 정직성 확인. 결과: 약 2년간 주가 약 7배 상승, 상승은 주로 이익 성장에 기인하며 PER은 최고 약 15배 수준. 애널리스트 미팅 참석자가 약 50~60명으로 늘어나는 시점에 매도. 교훈: (1) 좋은 애널리스트가 아니면 좋은 투자자가 될 수 없다. (2) 기회가 오면 빠르게 집중해 깊이 조사해야 한다. 출연자 전망: 영상 내 향후 가격 방향 예측 발언 없음(과거 사례 설명).
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laylu is one of the world's best known value investors he escaped China after being actively involved as a student leader in the Tiananmen Square protests in 1989 and after escaping China he enrolled at Columbia University in Columbia business school initially he enrolled in the American language program simply just to learn English and following that he became one of Colombia's first ever students to complete three degrees simultaneously Lilo got his ba in economics he did his MBA and he also did a law degree while studying at Columbia while studying at Columbia lilu also had very impressive investment results he actually took his student loan money and almost generated student loan float basically he was being paid money for his student loans before it was you know due to be paid to Colombia for tuition fees and so on there was a short period of time where he basically had that cash a little bit like how Berkshire Hathaway was Warren Buffett generates Insurance float where companies like Geico receive cash from insurance premiums that people pay before they have to actually pay that cash out in insurance claims lilu invested that student loan float and is widely rumored to have graduated with no student loan debt and several hundred thousand dollars to his name I've even heard a couple of versions of that story where he may have actually been a millionaire by the time he graduated Colombia not sure exactly how true that is but nonetheless the record during his Columbia years is ridiculously impressive Lilo then went on to start his own fund Himalaya Capital which from 1998 through to the last update we have in 2017 has compounded investors Capital 19.4 per year that compares to about 6.5 percent in the S P 500 over that same period of time and ten thousand dollars invested with lilu would have become about 243 000 versus only about 31 000 in the s p 500.
lilu's Himalaya Capital also notably has Charlie Munger as an investor up until 2022 lilu was the only investor that manga had ever put family money with uh earlier this year we actually had a story that manga had invested with a guy by the name of Charles Jennings who is the founder of a business called Stonehouse Corporation in Australia but for a very long time Lee Lou was kind of the go-to money manager for Charlie Munger now this video is actually going to be the first part in a three-part series on some of lilo's best ever Investments um this is an exercise I've gone through a couple of times on the channel recently uh with both Charlie Munger and Warren Buffett you guys really seem to enjoy these types of videos so this is going to be part one of lilu's best investments and if you want to see uh part 2 and part three as I upload them on the channel be sure to subscribe now in this video I want to talk about lilu's investment that he made in the late 90s and a company called Timberland some of you may remember Timberland as like the waterproof boots that made a lot of appearances for whatever reason and R B and rap and hip-hop music videos and uh lilu actually shared his Timberland investment story in a 2006 lecture that he gave for Bruce greenwald's value investing class uh back at Columbia now lilu actually stumbled across this particular company uh simply through value line he uh said in that talk that he's interested in all sorts of different businesses so he usually just gets the manuals by that he means like Moody's manuals value line basically resources that have you know a one-page kind of of information about several different stocks and it kind of just flip through Page by Page he says in this talk that he got hooked on value line when he was a student he loved to read the whole thing from beginning to end and it was enormously helpful now I'm going to put a link to Twitter down in the description below to uh Luke from snowball investing who actually shared uh one pager from value line on Timberland and I believe this is the one pager that Lilo actually handed out to the students on that day now lilu did say in the talk that um that one pager was a little later than the page he was really looking forward to kind of share with the students that he actually found in value line uh that particular page has the share price listed and the 40 range whereas uh lilu bought it more in like the high 20s to 30 issue range a little bit earlier so during that talk lilu kind of takes us through what he was really hunting for when he looks at a stock in something like value line uh he kind of says I first look at the valuation you don't really care where it's traded before and that's probably typical of most value investors they're not paying any attention at all to stock charts or anything like that they're trying to understand the underlying business and the valuation of that business as it stands right now lilu's initial kind of five second analysis as he described it is first off just trying to understand the quality of the business and if you've ever heard someone like Warren Buffett talk about what is a good business uh he simply defines it as a business that can earn a high return on Capital and that's basically the analysis that lilu kind of goes through initially so he saw that Timberland had Book value of around 300 million dollars and the market cap of the company at the time was about 300 million dollars or so now uh he really wanted to understand kind of what is in that book value he talks about this concept of kind of wanting to understand how clean that book value is he wants to kind of understand whether if things were to go completely South uh whether or not this company that he's bought for one times Book value can actually be converted into something that can give them some cash back so you know are the assets of this business made up of tangible things like real estate and cash or is it a bunch of intangibles and Goodwill and so on setting on the balance sheet now of that book value uh lilu could see that about 275 million dollars of that was working capital and he was also looking at Timberland right at the end of the third quarter and uh he kind of explains that if you know anything about retail businesses and these are just kind of things that you build up over the years in terms of your knowledge Bank you'd know that a lot of these companies tend to build up quite a significant amount of inventory at the end of the third quarter they're obviously going into the holiday season and they expect to be able to convert a lot of that inventory Into Cash by by selling their products so he said that you'll probably collect about a hundred million dollars in cash at the end of the quarter uh kind of if you look back at what Timberland had done historically by looking at this page on value line so by Lee Lou's quick analysis says he concluded that you had about 200 million on liquid assets about 100 million and fixed assets and he said that if he did a bit of further digging you'd actually find that that 100 million is almost uh entirely real estate so uh he says that you know we're trading at about one times book the book value seems pretty clean and I think the implication here is basically if uh Timberland would go south and go into some sort of liquidation process and the earnings and cash flows don't really turn up you've got that underlying really clean Book value as a bit of downside protection and the investment now of course wanting to understand the return on Capital and the business quality uh lilu then turns to looking at some of the earnings side of that equation and he says that what he's really looking for is we want to look at the unleveraged pre-tax earnings of the business and then compare that with the kind of capital employed that he he sort of just worked through earlier so he said we've got roughly 200 million dollars deploy lead kind of in the business and it looks like they're producing about a hundred million dollars of ebit so pre-tax unleveraged earnings in the business 100 million dollars in ebit versus 200 million dollars in a kind of capital deployed in the business gives us about a 50 uh return on Capital employed which uh lilu concluded is not a bad business so what then is the reason why Timberland is trading so cheap it's trading at about one times Book value and uh lilu mentioned in the talk a few times that it was trading around five maybe a little north of five times earnings and what it essentially found is that at the time of looking at this page and value line it was basically the height of the Asian financial crisis in the late 90s and a lot of shoe companies generally were actually um having a few issues due to that he said compenders such as Nike were seeing their businesses in Asia kind of fall apart and Timberland was actually a company that it had zero analysts following it so as a result you know being a shoe company and that's kind of all people really know about Timberland without doing a bit more digging it kind of just got thrown into that General basket of beaten up shoe companies like Nike lilu said that if you just looked at the data and value line you'd see that profitability had steadily been growing for Timberland and they hadn't always been super profitable but they had always been profitable and it seemed like the earnings were continuing to truck upwards over time but he did find one initial red flag which is that insiders owned about 40 percent of the company which isn't necessarily a red flag in and of itself can often be quite a good thing actually but he found that they had 98 or so of the Voting Rights so lilu then did what he describes as becoming an investigative journalist and uh doing some more digging into what's going on with some of the qualitative aspects of the company particularly around management so he found that he had all this Insider ownership a lot of voting rights for those insiders and he also found like a pile of shareholder lawsuits against Temple land and he said uh you know are these guys just milking money from the company what's what's going on here and his advice to the students at Columbia was you download every Court Document for every case and you read them every single page now after going through that exercise lilu basically found that all of these lawsuits more or less amounted to the same thing just um there were multiple filings for the same kind of issue and that was basically that Timberland used to give earnings guidance and several times that actually failed to meet that earnings guidance which are really annoyed analysts and uh insiders basically decided just to stop giving giving guidance because they were getting equally annoyed by the analyst community and uh that resulted in in basically several lawsuits so his conclusion from that first bit of work was okay so they're not Crooks but are they decent people and this is where the story gets out to me really interesting and uh he does way more work than I would ever anticipate the average investor doing and that's basically that he really really wanted to get to know the people in this business in Timberland as well as he possibly could lay low explains that he actually traveled to uh the town where this family is based he went to the church he met their neighbors tried to speak to basically everyone that knows him and he actually found that the son who I believe was the chief operating officer of Timberland at the time um was a business school graduate the dad who was running the company at the time actually turned out to have never graduated from high school but seemed to be you know a really decent guy by all accounts and lilu noticed that the son who had graduated from business school was on several boards one of which was run by a friend of lilu and uh lilu actually kind of uh asked in a favor and got himself on that board so that he could get to know the sun really well they actually ended up becoming reasonably close friends and his conclusion essentially was that the family turned out to be smart and really high integrity people so lilu's conclusion here from an investment perspective was that you had this business that had good downside protection it was trading at one times Book value and the book value was really clean it was cash a little bit of inventory and and real estate and it was trading at five or six times earnings and it was growing and he really liked the people that were running the business so he essentially made the decision to buy the stock and I will play the short clip of lilu describing exactly how much money he allocated to this position and you look at how much of their international business such as actually in shoes and in Asia less than 10.
what they make out of that less than 10. 10 out of the ten percent of the 27 so you calculate all of that you said all of them are gone you're losing money so what it reduce your earnings by less than five percent so I put a shitload anybody know what happens afterwards so what ended up happening next now Lilo explains that the stock ended up going up about seven times in two years which is an astronomical return but he also explains that most of that massive return was really driven by earnings growth he had a business that he bought for about five times earnings and he said that even though that PE ratio did go up the multiple expanded it never really got north of about 15 times earnings so this huge you know multibagger home run return wasn't just you know lilu right in a bubble or anything like that of some super speculative company with no profits it was that the earnings multiple had expanded but the underlying earnings of the company were also steadily Trucking up at like 30 a year lilu also explained that the sun initially the Chief Operating Officer actually ended up becoming CEO and running the business and he actually started engaging with the analyst Community again and uh in that very first analyst meeting there were three people that showed up one of them was Lee Lou one of them was the CEO and then there was one other analyst and that was basically it but um over time those meetings got larger and larger presumably because the stock was doing really well and the underlying business was doing really well and by the year 2000 uh Lilo says there are about 50 or 60 people at that analyst meeting so that's kind of that was kind of his cue to sell and and get out of the investment now for me there were really two main lessons from this investment in Timberland from lilu besides the fact that um you know when you have a combination of great earnings growth and multiple expansion uh really good things tend to happen that's something I think we probably already knew but this is a great example of that the two real lessons here I'm gonna give you in the form of lilu quotes and the first one is if you're not a good good analyst you will not be a good investor now it's clear to me from watching this talk from Lee Lou that you know he's able to stare at a page and value line for about three seconds and um pretty quickly draw a lot of great conclusions around what's happening with that underlying business he can understand the book value you know basic price multipools what's in the book value what's the return on Capital and draw some pretty good conclusions around what's happening with that stock not not just from the perspective of it being a piece of paper but also from the perspective of it being ownership in a real business and as he continues to truck through many different pages about many different businesses and value line he also builds up sort of this knowledge Hub you know he understands that in the third quarter of the Year retail businesses tend to build up lots of inventory going into the into the holiday season and I'm sure he knows multiple sort of nuanced details about all types of businesses from his from his research over the years the second thing that really stands out and again and leeloo quote form I'll give it to you here he says opportunities like that don't come very often so when it comes you have to seize it you have to do everything complete but you have to do it fast when opportunity comes you have to jump on it and it's intensive work for a short period of time this is probably one of the craziest stories I've heard of an investor going and doing deep qualitative work on the management team of a company you know joining a board that you know the son of the CEO is on is not something that the typical investor can do but it really just shows how much groundwork Lulu's putting in here particularly before he swings really large at a company so that is the story of lilu's investment in Timberland I do hope you enjoyed it if you want to catch part two and part three in this three-part series about some of Lulu's best investments be sure to subscribe to the channel if you haven't already but that's
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