Graham & Doddsville An investment newsletter from the students of Columbia Business School Inside this issue: Issue XXXIII Spring 2018 Pershing Square Challenge P. 3 A Final Lesson: Bruce Greenwald & Mark Cooper CSIMA Conference P. 4 Professor Bruce C. N. Greenwald, who Bruce Greenwald holds the Robert Heilbrunn Professorship of & Mark Cooper P. 6 Finance and Asset Management at Columbia Business School and is the Student Academic Co-Director of the Heilbrunn Investment Ideas P. 16 Center for Graham & Dodd Investing, is set to retire from Columbia at the end of the Michael 2017-18 academic year. Described by the Mauboussin & New York Times as “a guru to Wall Street's Tom Digenan P. 28 Bruce Greenwald & gurus,” Greenwald is an authority on value Mark Cooper, CFA ’02 investing with additional expertise in Rishi Renjen P. 40 productivity and the economics of Editors: (Continued on page 6) Abheek Bhattacharya MBA 2018 Trusting the Process: Michael Matthew Mann, CFA Mauboussin & Tom Digenan MBA 2018 Michael J. Mauboussin is Director of Adam Schloss, CFA Research at BlueMountain Capital MBA 2018 Management in New York. Prior to joining Ryder Cleary BlueMountain in July of 2017, he was a MBA 2019 Managing Director and Head of Global Financial Strategies at Credit Suisse. Gregory Roberson, Esq. Before rejoining Credit Suisse, he was MBA 2019 Chief Investment Strategist at Legg Mason Michael Mauboussin & Capital Management from 2004-2012. Mr. David Zheng Tom Digenan Mauboussin joined Credit Suisse in 1992 as MBA 2019 (Continued on page 28) Rishi Renjen, ROAM Global Management Visit us at: www.grahamanddodd.com Rolf Heitmeyer www.csima.info Rishi Renjen is the Founder and CIO of ROAM Global Management that will launch in the Summer of 2018. Prior to founding ROAM Global, Mr. Renjen was a Managing Director and Sector Head at Maverick Capital, a Partner at TPG-Axon Capital, and a Senior Analyst at Glenview Capital. Prior to Glenview, he was a Private Equity Analyst at Warburg Pincus and began his career in investment banking at Citigroup. Renjen earned a Bachelor of Science in Economics, with a concentration in Finance, from The Wharton School at the University of Pennsylvania. Rishi Renjen (Continued on page 40) Page 2 Welcome to Graham & Doddsville We are pleased to bring you the We also paired Michael Mau- cuss their 2nd place pitch of 33rd edition of Graham & boussin of BlueMountain Capi- Credit Acceptance Corpora- Doddsville. This student-led tal Management and Tom tion (CACC); Mike Allison ’19, investment publication of Co- Digenan of UBS. Both Michael Eric Herzfeld ’19, and Michael lumbia Business School (CBS) is and Tom have spent a portion Wooten ’19 share their 3rd co-sponsored by the Heilbrunn of their careers teaching stu- place pitch of Spotify Technolo- Center for Graham & Dodd dents outside of their day jobs gy, Inc. (SPOT); Ryan Darrohn Investing and the Columbia Stu- as investment professionals. ’19, Brad Headley ’19, and John dent Investment Management They talk about the base-rate White ’19 discuss C.H. Robin- Association (CSIMA). fallacy, sustainable competitive son Worldwide (CHRW); Ar- advantage, ETFs, and decision- thur Brousseau ’19, Greg Meredith Trivedi, the This is a bittersweet issue for us. making within a team. Doger de Speville ’19, and Heilbrunn Center Director. Bruce Greenwald, the Academic Neethling McGrath ’19 present Meredith skillfully leads the Co-Director of the Heilbrunn Rishi Renjen sat down with us Harvey Norman Holdings, Ltd. Center, cultivating strong Center, retires at the end of this ahead of launching ROAM (HVN). Separately, Jingjing relationships with some of academic year. Our first inter- Global Management, a concen- Huang ’19, Matthew Mann ’18 the world’s most experi- view recognizes him and brings trated long-short fund focusing and Viraj Vora ’19 bring their enced value investors and more of his insights to our read- on single-name shorts. Rishi pitch on Digicel’s 2020 bonds. creating numerous learning ers. Similar to the way Prof. tells us what he has learned opportunities for students Greenwald has bridged theory from mentors such as Lee We are honored and privileged interested in value invest- and practice, all four of our oth- Ainslie and Larry Robbins, how to have continued the Graham ing. The classes sponsored er interviewees have had a foot mentorship and culture are key & Doddsville legacy, and we by the Heilbrunn Center in both worlds at some point. in investing, and why he still look forward to reading the are among the most heavily teaches not one but two clas- next generation of issues, demanded and highly rated We started by pairing Bruce ses year-round at Columbia. helmed by three outstanding classes at Columbia Busi- Greenwald with his former individuals in Ryder Cleary ’19, ness School. student and current collabora- Lastly, we continue to bring Gregory Roberson ’19, and tor, Mark Cooper, CFA ’02, a you pitches from current stu- David Zheng ’19. We want to portfolio manager at First Eagle dents at CBS. In this issue, we thank Ryder, Greg and David Investment Management. Mark feature ideas from finalists of for their commitment and dedi- discusses his evolution as an the 11th Annual Pershing cation to Graham & Doddsville. investor and what he’s learned Square Challenge in April 2018, from Prof. Greenwald. Mark all of them shorts. Jade Hu ’19, We thank our interviewees for talks about Deere & Co. while Asher Jacobs ’19, and Rana contributing their time and Prof. Greenwald warns tradi- Pritanjali ’19 share their win- insights not only to us, but to tional value investors that the ning pitch of Stericycle, Inc. the investment community as a world has changed and that they (SRCL); Steve Cao ’19, Winter whole. need to adapt. Li ’19, and Tyler Redd ’19 dis- - G&Dsville Editors Professor Bruce Greenwald, the Faculty Co-Director of the Heilbrunn Center. The Center sponsors the Value Investing Program, a rigor- ous academic curriculum for particularly committed stu- dents that is taught by some of the industry’s best practi- tioners. Mario Gabelli ’67 and Professor Tano Meredith Trivedi with Professor Bruce Santos, Co-Director of the Heilbrunn Greenwald Center for Graham and Dodd Investing, at the 2017 Omaha dinner Volume I, Issue Page 2 3 Page 3 Pershing Square Challenge 2018 Pershing Square founder William Ackman and the 2018 The judges listen to a riveting student pitch Pershing Square Challenge judges panel William Ackman posing with the winning team of Jade Winter Li ’19, Steve Cao ’19, and Tyler Redd ’19 deliver Hu ’19, Rana Pritanjali ’19, and Asher Jacobs ’19 their 2nd place pitch Michael Allison ’19, Eric Herzfeld ’19, and Michael Wooten ’19 share their thoughts on Spotify Page 4 2018 CSIMA Conference Professor Bruce Greenwald and Litespeed Partners’ Columbia Business School professor and Gotham Capital Jamie Zimmerman have an enlightening discussion founder Joel Greenblatt shares his expertise Capital Group’s Jody Jonsson (left) and Ryan Brown Conference Chairs Justin Charles ’18 (left) and discuss navigating the road ahead Harsh Jhaveri ’18 address the crowd The annual CSIMA Conference always brings a packed house as investors network and listen to new ideas Volume I, Issue Page 2 5 Page 5 SAVE THE DATE 28th Annual Graham and Dodd Breakfast October 19, 2018 A Discussion with John Griffin of Blue Ridge Capital and Ian McKinnon, formerly of Ziff Brothers Investments Presented by: The Heilbrunn Center for Graham & Dodd Investing For inquiries contact: [email protected] Page 6 A Final Lesson: Bruce Greenwald & Mark Cooper ’02 information. Media Companies (with Graham & Dodd Investing Jonathan A. Knee and Ava at Columbia Business Greenwald has been Seave, Penguin, 2009) and School. recognized for his Adverse Selection in the outstanding teaching Labor Market (Garland Mark has a BS from MIT abilities. He has been the Press, 1980). and an MBA from recipient of numerous Columbia Business School, awards, including the Greenwald received a B.S. where he completed the Business School’s Lifetime and a Ph.D. from the value investing program. Achievement Award and Massachusetts Institute of He is a former US Army the Columbia University Technology and an M.P.A. officer. Mark holds the Presidential Teaching and M.S. from Princeton Chartered Financial Award, which honors the University. Analyst (CFA) designation. Professor Bruce best of Columbia's Greenwald teachers for maintaining Mark Cooper ’02, a co- Graham & Doddsville the University's portfolio manager on the (G&D): Mark, could you start longstanding reputation International Small Cap by introducing yourself, for educational excellence. Value strategy at First including how you first His classes are consistently Eagle Investment interacted with Professor oversubscribed, with more Management, is one of Greenwald? than 650 students taking Greenwald’s former his courses every year in students and current Mark Cooper (MC): I’ve subjects such as Value collaborators. Mark joined been at First Eagle for the last Investing, Economics of First Eagle’s Global Value four years. I co-manage an Strategic Behavior, team in May 2014. He is international small-cap strategy Globalization of Markets, also a senior research with Manish Gupta ’07. I also and Strategic Management analyst covering surface have senior analyst of Media. transportation and responsibilities on a few logistics, oilfield services, sectors, including oilfield Mark Cooper, Since 2007, Greenwald has and automobiles. Prior to services, surface CFA ’02 served as Director of joining the firm, Mark had transportation, logistics, and Research, and currently both research analyst and autos. Senior Advisor, for First portfolio management Eagle Investment responsibilities covering I met Bruce 17 years ago. We Management. In addition, stocks globally at PIMCO. hit it off really well, maybe he consults worldwide on a Before PIMCO, he was a because we have two things in variety of issues partner and portfolio common: We were both MIT concerning capital manager at Omega undergrads, and we both markets, business strategy, Advisors, where his jumped out of airplanes in the corporate finance, and research focused on Army.