Long Bob the Builder, Short the Sodor Railway

by User Submitted

Submitted by LoS readers “Anonymous”

Anyone with a boy between the ages of one and five will be familiar with both Bob the Builder and The Sodor Railway – home of Thomas the Tank Engine. Both entities are owned by Hit Entertainment, an entity taken private off the London Stock Exchange by 2005, but apart from that they represent vastly different investment options.

Bob The Builder and his team have built an ethical, environmentally-sensitive construction business based in the booming Sunflower Valley. A family business, the culture of the operation is rooted in the values handed down from his father. They offer great value to their clients by staying under budget while building attractive, energy-efficient structures. Sites are always organized and clean, and safety is clearly a priority. The company also provides exemplary solutions to the problems that arise when new development encroaches on wildlife.

Bob’s team is a textbook example of emotional intelligence driving value. The team is smoothly integrated in a number of important ways – among races, among species, among all the mammals and several machines with extraordinary artificial intelligence – all of which pays off in superb performance. Bob is an efficient manager and consensus builder; this commitment is reinforced every day in song. This focus on employee satisfaction allows Bob to achieve industry leading productivity levels while keep wages below the industry median.

By contrast, the Sodor Railway (home to Thomas the Tank Engine) is fraught with managerial, operational, infrastructural and safety issues. The island is subject to an assortment of unrelated but frequent natural disasters which soak up governmental funds. This, in conjunction with mismanagement, has prevented Sodor from adequately investing in effective infrastructure which will attract new businesses and their tax revenue. Key bridges and stretches of track routinely fail, resulting in delayed deliveries and damaged stock. Abandoned mines and other Superfund sites are left open resulting, creating a looming environmental hazard.

The CEO, Sir Topham Hatt has overseen a comprehensive decline of the railroad and has neglected critical infrastructure. Hatt engages in wanton appropriation of company assets for personal use, frequently damaging them in the process. On one notorious afternoon, he commandeered an entire train, a truck and a steamroller to get to his wife’s decadent Kozlowski-type birthday party which may or may not have have had midgets serving cocktails.

The Sodor Railway team has devolved into two ethnic factions – steam engines & diesel engines – tended by humans suffering from severe ADD. The engines’ internecine struggle not only routinely disrupts operations but also distracts management from planning for the future, further burdening a proven incompetent management.

Recommendation: Long Bob the Builder, Short the Sodor Railway. We see a compelling pair trade between the two, and recommend a 1:2 long to short ratio.

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