We updated our estimate of fair value for each company in the portfolio. Based on our estimate of fair value relative to the company’s current stock price, we determine the company’s current margin of safety. We aggregate the individual company margin of safety based on composite weight within the Core Equity portfolio to determine the … Read more
“This will not end well” was our reaction to the Federal Reserve’s announcement that they will not taper their current efforts at quantitative easing. Equity valuations will continue to delink from reality while idle money will finally feel compelled to leave the sidelines and chase performance. We are now in the final act but we … Read more
We updated our estimate of fair value for each company in the portfolio. Based on our estimate of fair value relative to the company’s current stock price, we determine the company’s current margin of safety. We aggregate the individual company margin of safety based on composite weight within the Core Equity portfolio to determine the … Read more
Known as the VLMAP, Value Line’s median appreciation potential is the median percentage by which Value Line’s analysts collectively project how the 1,700 stocks they follow will grow over the next three to five years. The estimate of the median price appreciation potential is found by first calculating the percentage change between the current price … Read more
The official definition of Tobin’s Q is the ratio between the market value and replacement value of the same physical asset. For stocks, we compare current stock market capitalization to the cost of simply replacing all the companies that publicly trade. When the ratio is above 1, it means that it is cheaper to build … Read more
We updated our estimate of fair value for each company in the portfolio. Based on our estimate of fair value relative to the company’s current stock price, we determine the company’s current margin of safety. We aggregate the individual company margin of safety based on composite weight within the Core Equity portfolio to determine the … Read more
A recent Wall Street Journal article on value investing caught our attention (Jason Zweig, 2/15/13), as Jean-Marie Eveillard of First Eagle Funds summed up the challenge inherent in adhering to an out-of-favor discipline: “After one bad year investors were upset,” he recalls. “After two they were mad, and after three they were gone.” Between 1997 … Read more
We remain perfectly content for time to pass without buying anything when selling is the order of the day. As disciples of Dodd & Graham value investment discipline, we believe stocks are getting expensive and we are growing accordingly less excited about equities in general. Not surprisingly, the crowd is getting more bullish as prices … Read more
Our Core Equity strategy finished the year up 4.5% while the S&P 500 was up 15.2%. With approximately 22% of our portfolio in cash, some of our underperformance was attributable to this cash allocation. Although we do not enjoy underperforming the market in a given year, we recognize this to be a likelihood from time … Read more
We updated our estimate of fair value for each company in the portfolio. Based on our estimate of fair value relative to the company’s current stock price, we determine the company’s current margin of safety. We aggregate the individual company margin of safety based on composite weight within the Core Equity portfolio to determine the … Read more