Ann: Trading Update, page-65

While I agree with you about the macro of sdi - it just makes sense that more will be spent on dental care worldwide over the next 50 years (as @Jimmy_C quantified), I think it’s the micro here we need to focus on. As has been discussed at length before, the directors and management are fighting some pretty big and powerful companies, but I don’t think they would really see sdi as a threat and I can’t see them cutting their margins to starve sdi anytime soon. I think management at sdi are capable, conservative and our interests are very much aligned. This is not just a job for them and they’ve fought before and they’ll fight again to keep sdi relevant and profitable.

The high spend on r&d is understandable given their requirement to transition from amalgam to non amalgam. I believe eventually this will abate and then once growth returns and fcf improves, we’ll see a significant multiple expansion. This could occur in 12 months or 5 years (or maybe it won’t). When comparing this to other opportunities, I can’t see the multiple expanding significantly at reh, nck or brg - they will simply need to continue growing earnings to maintain share price appreciation.  

As I said before I was most disheartened by the decline in whitening and the reduction in the growth of aesthetics, but the commentary to me otherwise seemed very fair in the trading update, and I’m hoping the market gives me an opportunity to increase my holding in sdi at similar or cheaper levels when I decide I think the risk of further profit declines has reduced far enough. Whether or not this occurs is beyond my control.

the portfolio discussion is great and while I really appreciate thinking about others methods and rationalisation, I don’t think it’s appropriate to ‘judge’ another’s methods as right or wrong, better or worse, when individual circumstances and desires can be vastly different. Also ones desire to hold cash or not significantly affects the opportunities one might consider in the market.

And while I agree with @travelightor in terms of the variety of people’s investment methods, And I think it’s encouragable to promote independent thinking, i don’t think it’s fair to criticise people for trying to learn from others who have more experience (which may occasionally consist of showing deference). I know I’ve learnt a lot from a select few on hot copper, and I like the variety or learning; through gaining personal experience, didactic learning from books, and in conversation with others such as yourselves