Bob stops by The Business Brew to discuss his early career, what he has learned over his career, investing in cyclical businesses/industries, and his biggest investment "loser." This conversation is filled with good lessons and we hope you enjoy.
Robert Robotti is the President and Chief Investment Officer of Robotti & Company. Prior to forming Robotti & Company, Incorporated in 1983, Bob was a vice president and shareholder of Gabelli & Company, Inc. He worked in public accounting before coming to Wall Street and is currently an inactive CPA. Bob holds a BS from Bucknell University and an MBA in Accounting from Pace University. Some of Bob's areas of coverage include Special Situations, Energy Industry and Home Building. Bob is the principal of the managing member or general partner of several investment vehicles.
Bob currently serves on the Board of Directors of a NYSE-listed real estate company, AMREP Corporation, located in Germantown, PA; as Chairman of the Board of Directors of Pulse Seismic Inc., a seismic data licensing business located in Calgary, Alberta; as an Independent Director of PrairieSky Royalty, a Toronto Stock Exchange listed company located in Calgary, Alberta, having one of the largest portfolios of sub-surface mineral rights in western Canada; as a recently elected Director of NYSE-listed Tidewater, Inc. which owns and operates one of the largest fleets of OSVs (Offshore Support Vessels) in the industry; and was previously on the Board of Directors of BMC Building Materials Holding Corporation, prior to the completion of its merger with Stock Building Supply Holdings, Inc. on December 1, 2015; and Bob had served on the Board of Panhandle Oil & Gas Company, a NYSE-listed diversified mineral company located in Oklahoma City through May 1, 2020.
In addition, he serves on the Boards of many non-profit organizations where he generously donates his time and expertise. Previously, Bob was a member of the Securities and Exchange Commission's Advisory Committee on Smaller Public Companies, established to examine the impact of Sarbanes-Oxley Act and other aspects of the federal securities law.
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Detailed Show Notes Below:
1:00 - Bob’s early career
4:18 - how Bob ended up as CFO of Gabelli and Company
8:05 - Bob’s evolution as an investor
12:00 - how tough times create better businesses and Builder’s FirstSource discussion
16:00 - Holding equities and Bob’s biggest loser
27:30 - Why earnings drive liquidity
29:00 - How does Bob implement his takeaways from his biggest loser?
31:15 - Why Bob got excited about the Revenge of the Old Economy in 2020
33:00 - The case for Olin Corp
41:30 - How Bob’s “margin of safety” comes from his portfolio company’s asset bases.
43:30 - Bob’s energy outlook; this is an around the world oil discussion that lasts ~11 minutes
1:00:00 - why reshoring makes sense
1:02:00 - did Volker really succeed?
1:03:00 - why China is no longer deflationary
1:07:00 - the nuance of selling
1:09:00 - what are the lessons we should learn vs what should we be worried about unlearning linear thinking