All of the presented ideas are located on the Value Investing Congress Blog. Here's a couple of them:
• Demand for aggregate materials (asphalt related) will grow as US infrastructure (bridges, roads, etc) are in need of repair.
• The aggregate industry suffers from the “Not in my back yard” syndrome, so new mines are not being opened quickly enough. Plus, it takes five years, an onerous amount of permits, and $100 million to open a new mine.
• With growing demand for aggregate material, and desperate needs for infrastructure improvements in the US, Vulcan is well positioned to be a beneficiary.
Pabrai began by reiterating the notion that we as investors or entrepreneurs should look for opportunities with low risk but high uncertainty. If your risk is low, losses will be not break you. Since Wall Street hates uncertainty, it tends to misinterpret certain situations and companies, over-punishing them in the process. This gives patient, diligent value investors a potential advantage.
Pabrai’s favorite idea was Wellcare (WCG, $46.49), whose shares slid from 128 to 21 in a very short time frame, following a raid and seizure of documents and materials by 200 federal agents related to potential excess Medicare billings.
• Pabrai became interested when it was disclosed in a 13G filing that Fairholme Funds took a 16% stake in Wellcare, following the raid