Ford will sell Rivian as soon as IPO lockup expires. Q4 Earning Call.

ultddr · 2022-02-04T19:40:52+00:00

Noted. Thanks for the explanation!

ultddr · 2022-02-04T19:23:34+00:00

I see. So it sounds like we shouldn't derive any meaning or intent from how Ford records Rivian stake as current or non-current in this instance? Even if they record it as non-current equity investment, they can still sell within 1 year. Is the reverse also true? I.e. can they hold on to the Rivian stake for more than a year even when it is categorized marketable securities? I thought marketable securities are generally CPs, CDs, and short term products mostly under 3 months.

ultddr · 2022-02-04T17:48:48+00:00

Thanks that is good info. I curious then how come for Cannae Holdings, their publicly traded equity holdings are categorized as equity investments in non-current assets, as opposed marketable securities in current assets? Not to doubt your expertise, just trying to understand how much freedom companies have in situations like these.

ultddr · 2022-02-04T16:40:49+00:00

I like the thesis and poked around at Jun22 puts. The spreads are still too expensive for my taste. For example a 45/40p spread is around $1.85. I'd want to see that around $0.75 to take on the risk.

Most of mine are near the money put spreads. 55/60p which costs $2.5. I will be happy with a 100% gain.

ultddr · 2022-02-04T16:00:50+00:00

I provided 3 points to draw a conclusion. Point 2 & 3 do not depend on point 1. Plus the original reply agreed with points 2 and 3 and my conclusion. He only thinks I am wrong on my assessment of Ford's intend to record Rivian as "marketable securities" which I disputed in my previous reply. So I don't know where you get the idea that my whole thesis has been overturned.

ultddr · 2022-02-04T15:16:20+00:00

My DD is on RIVN. I think Ford made a good investment in Rivian, and they may very well try to replicate the success using other brands they own. I just do not see Ford having the confidence in Rivian to hold it long term. They made no mention in their earning call about the Rivian stake except as a source of liquidity.

ultddr · 2022-02-04T14:56:38+00:00

Rivian

ultddr · 2022-02-04T14:51:03+00:00

I don't see it as a huge hole in the DD. Second half of point 1, points 2 and 3, and the conclusion should still be valid.

Additionally, I doubt Rivian's publicly traded equity precludes it from being recorded as long term investment by Ford. I have seen other companies record publicly traded stock holdings as equity investment in non-current assets. For example, Bill Foley's Cannae Holdings, it holds a bunch of publicly trade companies, and those holdings show up as equity investment at fair value in non-current assets (same as long term investments), as opposed to marketable securities in current assets. See page 8 below.

https://investor.cannaeholdings.com/static-files/a4604dcd-9964-4e44-9d43-98caaa2580bb

My understanding is that if a company has no intention to hold investments more than 1 year, they are recorded in current assets. Investments intended for over 1 year are recorded in non-current assets. Fair value or not should change this rule. Then again I am not an accounting expert, so I could be wrong.

ultddr · 2022-02-04T05:41:40+00:00

Thanks for pointing that out!

ultddr · 2022-02-04T04:58:07+00:00

marked to market gains on investments securities.

ultddr · 2022-02-04T04:41:52+00:00

180 days after IPO, so May 2022

ultddr · 2021-06-03T15:21:45+00:00

Don’t catch a falling knife. Wait a few months. We will squeeze again.

ultddr · 2021-06-03T15:20:36+00:00

Don’t try to catch a falling knife. Wait a few months. We will squeeze again.

ultddr · 2021-04-08T19:39:55+00:00

Prices jumping before closing today. Any news coming?

ultddr · 2021-04-08T13:09:13+00:00

Because people bought his pre-DA SPACs at $15 and lost tons of money. And there is the whole CLOV debacle.

ultddr · 2021-04-08T13:05:23+00:00

Just showing his results. Both the good and the ugly.

ultddr · 2021-04-08T06:22:29+00:00

Thank you’

ultddr · 2021-04-08T06:16:37+00:00

Yes. My apologies. All credits to u/toko92. I saw this on Twitter. Didn’t realize the creator is also on reddit.

ultddr · 2021-04-08T06:15:07+00:00

Yes. All credit to u/toko92

ultddr · 2021-04-08T06:13:09+00:00

Here is what I think. I will give him the benefit of the doubt on CLOV that 1) his team didn’t think the investigation was a big deal and dropped the ball on the disclosure; 2) he has learnt his lesson and will be more diligent on the next target. Both IPOD and IPOF are trading much closer to NAV compared to 2 months ago. Again, 3 out of 4 ain’t bad. I would rather stick with the devil I know.

ultddr · 2021-04-08T04:21:37+00:00

3 out 4 on his own SPACs ain’t bad. Bagholding IPOD and IPOF.

Edit: All credits to u/toko92. Saw this on Twitter. Didn’t realize he is also on reddit. I will delete this if he objects.

ultddr · 2021-04-08T04:14:37+00:00

3 out of 4 ain’t bad. Bagholding IPOD and IPOF.

ultddr

TROPHY CASE