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I read two interesting reports this weekend. One that talked about normalized earnings by sector, and the other that looked at the earnings revisions needed next year to justify current valuation. Both very well-done – that is, if Wall Street operated out of a University lecture hall. As for me, I’ve just about had it with focus on current earnings and revisions. There are bigger questions to be answered here. Who will exist in a year? Who will go away? Who is making the right investments today and will double market share? There’s tremendous value out there folks… (yes, that is McGough sounding bullish), but there are just as many value traps and potential zeros. Starting later today, you will see regular postings from our team that tears apart each company in the space and drills down each company’s asset value.

Those who have started to let their inner Capitalist shine?
1) Diddy/LIZ: P Diddy (Sean Combs) stepped up last week with a financial partner to buy Enyce from Liz Claiborne. The deal is for $20mm, which is a rather sad statement for LIZ given that it bought the brand for $114mm just 4 years ago.

2) PSUN/Adrenalina: Also last week, Andrenalina (AENA) which is a 2-store retailer/media outlet, bid on Pacific Sunwear, which has about 950 stores. Here’s a $20mm EV company bidding for a $300mm EV company. Conventional wisdom might not like this, but are there any rules against David buying Goliath? We’ll be seeing more of this.

3) Gap/Athleta: Though this was earlier in the month, Gap buying Athleta was one of the few truly smart moves I’ve seen from Gap in a while. All that cash needs to go somewhere.