Value Investing
4 Things to Look for in an Investment
Do you know there are four value investing traits that are common to great investments? Read about each of these four characteristics in this article.
Are Large Cap Stock Undervalued?
Given the volatility on Wall Street, are large cap stocks and blue chips undervalued? Discover the answer in this value investing article.
Benefits of Stock Buy Back Programs
One of the keys to value investing is to look for companies that repurchase their shares. This value investing article discusses the benefits of stock buy back (aka repurchase) programs.
Benjamin Graham Value Investing Strategy
Benjamin Graham was the founder of the value investing movement that encouraged investors to focus on earnings and dividends. In his extensive body of work, he laid out his thoughts on what a successful portfolio should look like, and how value investing can be used to reduce risk.
Benjamin Graham's Intrinsic Value Formula
In his classic book, The Intelligent Investor, Benjamin Graham spelled out the intrinsic value formula he believed most investors were using in his day, including a warning not to rely too heavily on it. Still, it has its uses and can offer another protection against paying too much for a stock.
Bill Ruane Value Investing Strategy
Another one of Benjamin Graham's students, Bill Ruane was a dedicated value investor who amassed one of the best records in history for his shareholders. The Sequoia Fund made a lot of people very rich, including some investors who parked their money with him after Warren Buffett tied up his investment partnership in the 1960's.
Bottom Line - Profit and Value Investing
Value investing is solely concerned with getting the most profit at the lowest cost. The basis of value is profit. This article discusses and explains the various profit figures reported on a company's income statement.
Buying on Bad News - Acquiring Undervalued Stock
Sometimes a bit of bad luck for a company can be a lucrative opportunity for your portfolio. How do you know which companies are permanent losers and which are undervalued? This value investing article can help you discover buying opportunities.
Charlie Munger Value Investing Strategy
Billionaire investor Charlie Munger has talked about his focused value investing strategy, which involves selecting a few, great businesses in a lifetime, buying them at attractive prices, and then holding them for long periods of time so the business itself does the hard work.
Common Characteristics of Value Investing Stocks
Stocks that are considered suitable for a value investing strategy often display a handful of characteristics such as low price to book ratios and historical records of dividend increases.
Earnings Yield as a Value Investing Strategy
One quick well to tell if you are valuing a stock at insane levels is to look at the earnings yield, which is the inverse of the price-to-earnings ratio, and compare it to Treasury bond yields. It doesn't tell the whole story, but it can, in certain circumstances, help avoid major mistakes.
Finding Hidden Spots of Value in the Market
Finding undervalued stocks is easier if you first know where to look. These hints and tips will help you seek out undervalued stocks in the market for your portfolio.
Google vs. Berkshire Hathaway
From a value investing standpoint this article contrasts Berkshire Hathway and Google. It discusses various issues and financials regarding Berkshire Hathaway and Google as well as how a rational buyer may choose to loook at the business.
How Falling Stock Prices Can Make You Rich
In falling stock markets, you can actually get tremendously rich by buying the right stocks. How do you actually make money? How can falling prices increase your long-term returns? For these answers and more, this article can help you tremendously.
How to Think About Share Price
Did you know that a $125 stock may be cheaper than a $10 stock? One of the keys to successful value investing is understanding the relationship between price and earnings per share.
John Templeton's Value Investing Strategy
The late John Templeton was one of the world's most famous and successful value investors. He left his mark on the industry by taking the tenants of finding cheap stocks and bonds to Japan, buying up a portfolio of ownership that later made him a billionaire.
Look-Through Earnings - The Value of Retained Earnings and Cash Dividends
Billionaire investor and Berkshire Hathaway Chairman and CEO Warren Buffett urged investors to calculate what he called the look through earnings of their portfolio. This article explains how to calculate look through earnings and reveals why they are important to your investing success.
Margin of Safety
The absolute cornerstone of value investing is the concept of the margin of safety. You cannot understand how it works unless you understand this. Stop what you are doing and read this article. Otherwise, you might regret it.
Mr. Market
This famous allegory is one of the two most important concepts in value investing and should be understood by all who would manage their own portfolio.
P/E Ratio - The Key Value Investing Ratio
Benjamin Graham, the father of value investing, taught the importance of the price earnings ratio (or p/e ratio for short). This resource teaches you how to use the p/e ratio to compare companies operating in the same industry.
Real World Investing
Why would someone willingly pay nearly 40x earnings for a giant like Wal-Mart but only 14x for a small, fast-growing retailer when the latter had the chance to make you very, very rich? Find out answers to questions such as this one, and much more in this real world analysis of actual stock situations that existed over the past ten years.
Rejoice in Stock Market Corrections? Absolutely
If you practice value investing, you know that stock market corrections can present multiple opportunities for your portfolio.
Seven Tests of Defensive Stock Selection
Each autumn, I read Benjamin Graham's Intelligent Investor. Its value investing principles are timeless, unquestionably accurate, and contain a sound intellectual framework for investing that has been tested by decades of experience. This article focuses on the seven tests prescribed by Graham in Chapter 14.
The Strategic Use of Cash In a Value Investing Portfolio
As value investors don't buy an asset unless they believe it is fairly priced, or even better - cheap, this can often lead to large piles of cash sitting on the balance sheet. To understand the role cash plays in the process, I wrote this article going over some of the details.
The Two Questions Benjamin Graham Taught Investors To Ask Themselves
One of the greatest contributions of legendary value investor Benjamin Graham to the field of portfolio management was his rule that investors should ask themselves two questions before buying a stock or bond. These two questions can help you avoid a lot of mistakes and should be memorized, and used, throughout your life.
Tweedy Browne Value Investing Strategy
Tweedy Browne is one of the most famous asset management companies in the world. Back in its days as a brokerage firm, it sold Warren Buffett his shares of Berkshire Hathaway and, before that, served as Benjamin Graham's stock broker. Unabashedly adherents to the value investing school of thought, Tweedy Browne has put together one fo the best long-term records anywhere in the business.
Value Investing 101
Value investing is a school of portfolio strategy that involves only buying assets that are fairly priced relative to earnings and assets. Value investing ignores fads, can often seem out of date, and has historically produced much higher returns than alternative strategies, as evidenced by the nearly 100 year records kept by research services such as Ibbotson & Associates, who measure the results generated by various strategies. This overview explain how value investing works.
Value Investing in 30 Seconds
I often get asked, “What does it mean when you say you are a value investor?”. I thought it would be easiest to provide you with an example. In the next thirty seconds, you should understand how value investing works and why some people find it attractive as a philosophy for managing their portfolio. Personally, I cannot imagine putting...
Value Investing Strategy Essays
As a private investor who follows a value investing strategy, I've written a lot of essays that are reproduced on my personal site regarding the topic. These are not particularly appropriate for new investors and sometime delve into advanced topics on value investing, such as how to value stocks and bonds. You should only consider reading these resources after you have a firm understanding of the basics of value investing.
Value Investing vs Growth Investing
Although you don't hear much about it today, every few decades, a false controversy arises that attempts to separate value investing from growth investing. To prepare yourself for the next time this happens, learn what these terms mean.
Valuing Cyclical Stocks
As long as capitalism has existed, there have been businesses whose fortunes rise and fall with the economy as a whole. These "cyclicals" (as financial professionals refer to them) can go from generating breath-taking profits one year, to devastating losses the next. Discover how value investing seeks to minimize these earnings fluctuations.
Walter Schloss Value Investing Strategy
One of the most famous portfolio managers of the past century, Walter Schloss worked from a tiny desk next to a water cooler for more than 50 years, crushing the S&P 500 and Dow Jones Industrial Average. He never hired an employee, and his entire stock selection process consisted of index cards in a file cabinet. He owed his success to value investing, a school of thought developed by his professor and mentor, Benjamin Graham.
Warren Buffett Value Investing Resources
Warren Buffett is the most famous practitioner of value investing in the past fifty years. Read a biography, see a timeline, browse photo galleries, find links to Buffett's shareholder letters, and more in the Titans of Wealth section.