Stetson University’s Roland George Investments Program (RGIP) held its 10th public trustee meeting with some lively debates taking place as seven seniors pitched stocks they believed to be worthy of the program’s $100,000 investment.
After months spent researching, vetting, and analyzing, a total of five stocks were presented to a crowd including a board comprising four student trustees and three faculty/public trustees.
The stocks presented were Spotify, Berkshire Hathaway, Chegg, Etsy and Lennar.
Stetson University student Robert Brinson began the evening with his presentation of Spotify, a digital music-streaming services company. As indicators of its future growth, Brinson’s report referenced Spotify’s platform that allows users to create personalized, customized playlists, its ability to be used across all platforms from mobile to electronic devices, and international positioning. He estimated the stock to be undervalued by 25 percent and the trustees agreed with his assessment, voting 5-1 to invest $50,000.
Bilal Hashmi and Zak Levesque then launched into a lively debate by sharing two very different views on whether RGIP should invest in Lennar, one of the largest home construction and real estate businesses in the United States. Levesque argued that Lennar’s revenue and volume of sales in the U.S. housing market make them an industry leader worthy of a stock purchase.
Hashmi countered that Lennar’s excess supply in a downturn, contracting margins and a slowing housing sector were reasons to bypass this stock. Ultimately the trustees agreed with Hashmi, and voted to pass on this investment.
Etsy, Inc., an e-commerce platform to make, sell, and buy unique goods online was pitched by Shaw Fuller and again, the trustees passed on this suggested buy.
Next up was Berkshire Hathaway and according to Peter Linder, the firm’s unique structure with public and private holdings, leadership by Warren Buffet and recession-resistant holdings are strong indicators for long-term investment gains. Berkshire Hathaway is a conglomerate headquartered in Massachusetts with 377,000 employees across 62 subsidiaries and is known for insurance, utilities, and the Burlington Northern rail line company. Four trustees agreed that this $500 billion conglomerate would be a sound investment and voted 4-2 to purchase 800 shares for approximately $50,000.
In the final presentation of the evening, Erica Lee and Bryn McNeary debated the merits of Chegg, Inc. which operates a direct-to-student learning platform that supports students on their journey from high school to college and into their career with tools designed to help them pass their tests and classes, and save money on required materials. In the end, the trustees agreed with McNeary’s recommendation to pass on Lee’s suggested purchase of 2,500 shares of Chegg.
“This is the first time we pitched two stocks in a debate format,” said K.C. Ma, Ph.D., C.F.A., the Roland and Sarah George Chair of Applied Investments for RGIP. “Since every buy has to be matched with a sell, it is always beneficial to listen to both sides of the arguments.”
In total, $100,000 was approved from the RGIP Growth Fund for investment in the Spotify and Berkshire Hathaway.
The Stetson University School of Business Administration RGIP is known for having one of the nation’s oldest and best market performances, and is directed entirely by Stetson University students. The pioneering program empowers top students majoring in finance and business to manage a real portfolio comprising $3.5 million in stocks and bonds. Using fundamental research tools and data services such as Bloomberg, Reuters, Morningstar and Baseline, they find and defend investment recommendations to the investments committee.
Since 2001, based on the actual portfolio performances, RGIP students have won 16 championships and six second-place wins in the national R.I.S.E. (Redefining Investment Strategy Education) and G.A.M.E. (Global Asset Management Education) competitions.
Disclaimer: The Roland George Investments Program, and students affiliated with the program, are not Registered Investment Advisors. As a result, any information contained herein or presented at an RGIP event should not be construed as investment advice.