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Jfan's avatar

Dave does not mention the biggest flag about Four Corners: It is incorporated in Nevada.

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Sat JN's avatar

Hi Dave, a new reader to your substack. Enjoyed the writeup. To follow up, I have a doubt which I hope that you can clarify/shed light upon and I hope I am not asking much of your valuable time. Imagine a company that is competitively strong vs peers, growing and in a go-go industry that is expected to continue enjoying the tailwinds infinitely to the future. Despite such an description, if management or controlling shareholders of the company engages in questionable activities, or displays lack of ethics (for eg-scooping off revenues/value generated in form of costs/rents to related parties, family members; employing incompetent people across the board/management to oversee business; cheap capital access/siphoning to controlling shareholders/management in form of cheap loans etc.), what would be your approach to valuing/investing in such a company? Would you price in the possible risks in your valuation estimate, or completely steer clear from such companies even if they are available for huge discounts?

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