Taxi Medallions have been one of the best performing assets over the past twenty years: http://www.dailyfinance.com/2011/11/16/the-best-investment-on-wall-street-a-new-york-city-taxi-medalli/
However, you as an investor, must require a very high discount rate when you depend upon government licenses. If Uber makes inroads?http://www.bizjournals.com/sanfrancisco/print-edition/2013/05/17/uber-takes-the-pain-out-of-hailing-a.html?page=2
These Are John Buckingham’s Stock Picks For 2021
The economy remains in distress, although there are signs of recovery underway. John Buckingham of Kovitz, editor of The Prudent Speculator newsletter, has found that value stocks typically outperform coming out of economic downturns. Thus, he argues that this is an excellent time to be a value investor. Q4 2020 hedge fund letters, conferences and Read More
“Value” investors may flock to the seductive yield: http://seekingalpha.com/article/2246123-medallion-financial-hail-this-high-yield
But csinvesting.org readers know their history when technological change or a catalyst for regulatory change Airline_deregulation upends an incumbent, then the plunging price becomes a value trap versus an opportunity. Reflexively reaching for this 8% yield by not turn out well.
Of course, the future is uncertain, but after a five year bull run, failure to advance after last quarter’s earnings beat and pricing pressure from UBER, then Medallion Financial Corp (NASDAQ:TAXI)’s high valued medallions may become less so. The government is placing an artificial restriction to keep supply low while boosting prices that hurt consumers’ choices and pocketbook. I wonder how this fight will turn-out? I will be watching this unfold.
What do YOU think?