Ann: Form 8-K - FY24 Results, page-26

@noomxx ,

I'm no good at being able to predict how the cards might land in the Casino of Extraneous Factors, so I don't play there.

I've got zero idea where trade wars will start or end or what politicians might say or do, or what packaging volumes will be over the next 3, 6, 9 or 12 months.

Instead of spending any time trying to second guess macro-economic or geopolitical factors, experience has taught me that the way to create wealth through owning share in publicly-listed companies is to spend all my energies in deriving assessments of fundamental value and then buying whenever something happens that drives the market value of companies to levels lower than my assessment of their fundamental value.

In AMC's case the investment process is no more sophisticated than:

"For a business with AMC's operating business model and global presence and financial pedigree (earnings quality and dependability, operating margins, capital intensity, ROE etc), as well as track record in relation to management's stewardship of shareholder capital, on my valuation metric of choice, i.e., EV/EBIT, I am willing to pay 14x to 15x (which is equivalent to a ~6% to 7% FCF Yield. The stock is currently trading on 11.5x, implying 30% to 35% upside."

And should the stock fall further, the upside to fundamental value becomes more attractive, meaning I will add to my shareholdings.

That's about as sophisticated as I think it can be, and anything more than that is most likely mere distraction and "noise".

[Of course, that rudimentary approach isn't completely risk-free because it's success hinges on getting the fundamental/intrinsic value assessment right, which is easier said than done. But after a few years of having battle scars inflicted, one tends to be approximately correct more often than not. And even though it doesn't seem like it, merely getting more approximately right than not is all that is needed for enduring wealth creation.]

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