Is that my worst picture yet? Vote and win… I’m being told there is no prize and you can’t actually vote. Who runs this site, anyway? Sad!

Those of you who used to read my value investing site (may it forever RIP) might remember when I wrote about Information Services Corp (TSX:ISV), a great company I thought was trading at a very attractive valuation. ISV runs the Saskatchewan land titles registry, which a fantastic business. It’s one of the true monopolies left in today’s world.

Over its last four quarters, ISV did $17 million in net income on $90 million in revenue, for net margins of 18.9%. And that was despite a crummy first quarter. 2015’s full-year results had it doing $16 million in net profit on $78 million in revenue, for net profit margins of 20.5%. That is a succulent business.

I’ve balked at buying it because I’m a cheap bastard. It was slightly over $15 when I first looked at it. It promptly rallied to $19 and change. It went from being cheap (12x free cash flow, 15x earnings) to only fairly valued (at 16x free cash flow and 20x earnings). It pained me as a value investor to pay that much for a business, even one I view as being above average.

Maybe it’s the market euphoria talking, but I threw caution into the wind on Friday and tried to pick up some shares (my order has not be filled as I write this). The last time I paid up for a good business was Pizza Pizza, and my shares are up close to 50% (including dividends) in the 1.5 years since I bought. Here’s hoping for a similar result with ISV.

What a boring name for a company. Information Services Corp. They paid some marketing firm a quarter mil to come up with that, didn’t they?

Links I liked

1. Let’s start things off with Divestor, who pointed out some of the problems with selling covered calls as an income source. Remember one simple rule if you do try such a strategy — the higher the option premium the more volatile the underlying stock is. Something something no free lunch, in other words.

2. I have a feeling I’m going to be linking to Canadian Value Stocks a lot. Here’s his latest piece on Callidus Capital, a company with a succulent shareholder’s yield of 18.7% if you include the debt repayment. Yowza. Too bad leveraged financials give me nightmares.

Speaking of leveraged financials, First National Financial (TSX:FN) is pretty cheap. I’m avoiding it because of my aforementioned dislike of leveraged financials, but it’s super cheap (8x P/E) and is growing revenue at more than 10% a year.

3. Oddball Stocks points out that if a company has very little experience in growth, it can be a killer. It really depends on management.

4. I’m a big fan of the contrarian nature Freedom 35 Blog has taken on lately. Here’s Liquid arguing that real estate in Canada is still quite affordable. I’m not sure I agree, but I do like it when somebody writes something that makes me think.

5. I discovered this older post by The Money Wizard, and I agree with every last word. A much better emergency fund than cash in the bank is liquid assets. In other words, keep your cash on hand to a minimum and invest the rest, dummy.

6. Another interesting piece from Don’t Quit Your Day Job, who points out that often a cheque cashing place is a better alternative to banks, especially for poor people. The reason? No hold periods, among others.

7. My Own Advisor points out getting a tax refund is dumb because it’s a interest free loan to the government. Low interest rates do make this a bit of a moot point, but the point is still valid. I’d like to see more of these anti-tax refund posts mention the real reason to not want a tax refund, which is opportunity cost. I suppose it’s implied.

8. Somebody collected all of Charlie Munger’s speeches into a 350-page pdf and is giving it away for free. Saj Karsan has all the details.

9. My fellow writer Will Ashworth thinks Torstar Corporation is extremely undervalued. He has a target price 171% higher than the current price. It seems ambitious, but I do follow his logic. I’ve looked at Torstar a few times over the years. I just can’t pull the trigger.

10. And finally, here’s a link to one of the funniest unintentional pieces of comedy in the history of the internet. It comes from Canadian Money Forum and it starts out with the claim “the biggest emerging market we will see in our lifetime is the Cannabis industry.”

/takes bong hit

Weed cures cancer, man.

Things Nelson wrote

1. I told American investors how to collect $1,000 per month from a couple of popular REITs over at InvestorPlace.

2. I also compared gold to Bitcoin and asked which one was the better choice. Rant time: I don’t get Bitcoin, and never will. What’s the point? Your Bitcoins will never provide you an income stream. And even though the supply is tightly controlled (or so we’re told), it’ll still grow over time. It’s a dumb investment, IMO. Of course, gold isn’t much better, but at least you can get operating leverage from a gold miner.

3. Think you won’t be impacted by a Toronto housing crash because you were smart enough to take my advice and leave town? Think again, bucko. FEAR FEAR FEAR.

Tweet of the week

I really need to up my funny Twitter game.

Have a good week, everyone.

Tell everyone, yo!