Hi bensterz I used to be an enthusiastic AMA holder - for many...

Hi bensterz

I used to be an enthusiastic AMA holder - for many many years, through ups and downs (remember that time?!?). I viewed its acquisitions and alignment with insurers as a potentially industry-transforming business - I do not come across such investment opportunities too often!

With first mover advantage, AMA could position itself as a critical mass player well before anyone else could cotton-on to what they are actually achieving.

This would justify a high multiple - i.e. close alignment with end-customer/gatekeeper - i.e. insurers. I was happy to be a long-term investor in this regard - i.e. not too concerned about short-term GM improvement.

However, for a long time, I was thinking about what the potential switch to electric cars and more importantly - autonomous vehicles - would have on the entire transport industry. If you actually sit back and think about the implications for a business like AMA, they are not good - in my opinion.

I then watched this video:



To me Tony Seba makes a fairly compelling case that there will be a disruption in the transport sector - and it MIGHT be much much earlier than most people anticipate!

I was not going to try to figure out by when this would start affecting AMA's earnings. Especially, given that markets are always forward looking, it is likely to impact its share price well before its earnings (e.g look at the lower multiples already being assigned to conventional car manufacturers at the moment - why is this so?!?).

If you believe the premise of the Tony Seba presentation, it is difficult to justify high multiples on AMA earnings irrespective of current GM trends.

Obviously, the above is not meant as investment advice, but rather just my own opinion, which others may or may not agree with.