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Compass Diversified Holdings Message Board

  • hachi05man hachi05man Apr 8, 2012 9:30 AM Flag

    IMO Time for CODI To Build Current Companies

    When you look at the current Compass portfolio of companies ranging from inexpensive furniture to strategic rare earth magnets for motors I kind of wonder what's going on? Aside from financial gymnastics is there a) a strategic direction? b)an effort to build up sales/profits in the companies held? c) move manufacturing to lower cost regions? Light truck sales are up..are FOX SHOXX sales soaring? Glock and Ruger are sold out..we pushing Liberty Gun safes? We expanding baby carriers? Sure, the rare eath magnets for motors are a strategically important alternative to China but can we make profits at it? A 9.7% distribution is nice, but in manufacturing it should be more like 3% and the CODI unit price should be like $40 instead of $14....so, time to grow organically IMO instead of making acqusitions...and, oh yes, time to unload that furniture operation,too....

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    • I think we to give them some time. With the CEO leaving under SEC clouds (due to stuff prior to CODI) there was bound to be some changes in direction - as he was basically the company previously.

      I'm ok with the "niche" market approach - which is what I see. Small markets where the company is a large player means solid cash flows. Nothing really ties the companies together, but if the cash flow keeps increasing I'm ok with that.

      Personally, I'm giving management until 2013 and then I'll judge whether I think they will be successful. I do admit that if I could do it all over again, I'd own less CODI than I do and more of that money would be in PSEC.

    • While this is not Brk,you have probably made more money holding codi the last few years then Brk.

    • Hi Hachi05man:
      You never know where you will find me. You know I have always said that good management is the most important part of an investment that I look for.
      I have a strange feeling that if Frank Semple were running CODI, CODI probably could be selling for around $40 as you suggested. The problem is Mr Semple is busy elsewhere and not available currently.
      This company has intriged me for a while, but so far not enough to make me push the buy button. Maybe you have a better insight than I have.

      Best regards
      b&w

    • Their "strategic direction" is just to make money wherever they can. They have been choosing good companies, and I don't have any reason to think they aren't managing them well. Without a detailed analysis of a specific company and its situation, it's impossible to say they should be doing XYZ. As for the furniture company, it may not be the best time to sell. Plus, I heard somewhere that it's doing better.

    • Sounds like you want an apple instead of an orange.

      Agree about the furniture company, though--they need to shape up soon.

      Good luck.

      jn

 
CODI
17.59-0.17(-0.96%)Aug 19 4:02 PMEDT

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