Portfolio Manager Lee Kronzon of Gator Capital Management says AMERCO (UHAL) is a very high-quality business and an attractive investment for many reasons.
“AMERCO is the industry leader in North America as the largest do-it-yourself moving truck and trailer rental firm. But AMERCO is also the second-largest self-storage facility operator in North America. Many of AMERCO’s truck rental facilities also have storage facilities attached to them. And that creates a great vertical integration opportunity that many competitors don’t have,” Kronzon said.
FOR MORE INFORMATION ON THIS INTERVIEW CLICK HERE.
While AMERCO has industry leadership that is important to the company, Kronzon says that the company benefits even more so from high entry barriers, and that its vast network is its competitive moat.
“That gives AMERCO a network effect: The more locations it has, the more attractive its services are to customers, and as a result, the more pricing power it has. We estimate that the U-Haul network alone would cost a competitor over $6 billion to replicate from scratch,” Kronzon said.
Brian Yacktman and Elliott Savage: the Network Effect and Stock Picking
October 16, 2020
Samsung Electronics Co., Ltd. (KRX:005930) Galaxy Smartphones Take Market Share Away from Competitors
June 24, 2013
American Assets Trust, Inc (AAT) Outperforms Competitors for 6.5 Years with High-Quality Portfolio Properties
June 27, 2013
Comcast Corporation (NASDAQ:CMCSA) Furthers Edge to Its Competitors
February 16, 2016
AbbVie Inc (NYSE:ABBV): Investors Misunderstand the Effect of HUMIRA Going Off-Patent
May 11, 2016
