The 2022 Uber Cannibals
In late December 2016, I co-wrote an article on Forbes.com that introduced the "Uber Cannibals," a 5-stock investing strategy that invests in businesses aggressively buying back their own stock. This is a "set it and forget it for one year" strategy that rebalances every April when 5 companies are selected for the portfolio for the upcoming year. The Uber Cannibals is also part of the broader 15-stock Free Lunch Portfolio, which also invests in Shamelessly Cloned ideas and Spawners that are updated annually in December.
We are now ready for the April 2022 Uber Cannibals picks.
Recap of 2021 Uber Cannibals:
As a recap, in my 3/31/17 blog post exactly 5 years ago, we met Ms. Sonia Patel, who had embarked on her Uber Cannibals compounding journey with $100,000 from her IRA account at Interactive Brokers. Sonia invested in the first 5 Uber Cannibals on 1/3/17, and then rebalanced her portfolio every year in April. The 2021 Uber Cannibals were:
As of 3/31/22, Sonia's $100k was worth $177,379, up 11.5% annualized since inception. If Sonia had instead invested in the S&P 500 over that period, she would be up 16.5% annualized and her portfolio would be worth $222,674. Uber Cannibals was up 15.7% in the last 12 months, vs. 15.6% for the S&P 500. Uber Cannibals has managed to keep up with the S&P 500 for the last 12 months, despite no exposure to high-flying tech names.
All five Uber Cannibals paid dividends. As per our rules, Sonia reinvested those dividends back into the same businesses.
Please note, the Uber Cannibals performance assumes that stocks are bought at the high price of the day and sold at low price of the day, whereas S&P 500 and Small Dogs of the Dow performance assumes that stocks are bought at last close.
Below is the 12-month return of the 2021 Uber Cannibals:
The New 2022 Uber Cannibals:
In the 2021 Uber Cannibals post, I talked about importance of holding on to great compounders and cannibals unless they get egregiously overvalued. In 2022, the algorithms did not serve up any cannibals that would improve the overall quality of the portfolio, and it does not seem that any of our five holdings are egregiously overvalued. So, we do nothing; there are no changes to the 2022 Uber Cannibals. Here are the 2022 Uber Cannibals:
If you are a new investor to the Uber Cannibals, you can just equal weight the five stocks (i.e., invest the same amount of money in each of these five) and keep that portfolio until April 2023, when I'll provide the 2023 portfolio on www.ChaiWithPabrai.com. Happy Cannibal Investing!
Note, anyone who invests in any strategy needs to do their own research/due diligence and are themselves fully responsible for the outcome.
4/12/2022 08:24:22 pm
I am just curious about Uber cannibals and have a quick question: THE Return mentioned on the blog doesn't match the return when I checked on robinhood/other app. Eg. For Navient, blog says 23% return last year where as I checked on app and it shows 10.95%. So, is there any other way of calculating return when the company buys back?
7/13/2022 06:42:26 pm
Purva, While i know Mr. Pabrai might respond I wanted to share with you my opinion on your question. I believe what he's talking about in regards to 23% gain is the entry in year 2021. Most likely he entered the position around February which would produce around 23-24% gain. Hope this helps!
4/20/2022 02:39:48 pm
Thank you so much for sharing this portfolio and these updates. Really wonderful way of looking at things and keeping it simple for value investors.
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1/1/2023 11:59:06 pm
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Mohnish Pabrai is the founder and Managing Partner of the