The death of equities

October 28, 2010

A steady drumbeat of articles proclaiming the death of the equity cult has cited many reasons, including loss of faith in equities due to various reasons, new alternative investments, baby boomers retiring and shifting from stocks to bonds, and projected anemic growth in the US vs other countries. Let’s take a look at some of […]

Read the full article →

Why commodity ETFs are a bad investment

October 21, 2010
Thumbnail image for Why commodity ETFs are a bad investment

Commodity ETFs are financial instruments that are supposed to enable small retail investors to invest in commodities such as oil and gold. Now normally, commodities are bad assets to invest in. They do not have any cash flow, incur storage costs, and will not grow. At first sight, then, commodity ETFs appear to be miraculous […]

Read the full article →

ValueClick : quality business run by mediocre management (VCLK)

October 17, 2010

ValueClick runs the second largest ad network on the internet, second only to the Google Adsense network. In an increasingly fragmented Internet, advertisers cannot contact each publisher individually to place advertisements, and turn to ad networks which aggregate content from many publishers. These ad networks are an excellent business, because they are semi-monopolistic toll booths […]

Read the full article →

Health and Wealth should not be Outsourced

October 13, 2010
Thumbnail image for Health and Wealth should not be Outsourced

In life, we specialize on the narrow set of skills required to perform our jobs, and outsource nearly everything else. We don’t try to make our own clothes, or grow our own food. We buy goods and services, and concentrate on our jobs. And most of the time, this works out great. Competition keeps everyone […]

Read the full article →

A heart-stopping ride with Cardiac Science (CSCX)

October 9, 2010
Thumbnail image for A heart-stopping ride with Cardiac Science (CSCX)

After nearly flat-lining from a huge AED recall, shares of Cardiac Science CSCX have risen somewhat on news that the company has reached a new recall agreement with the FDA, yet remain substantially below its intrinsic value. I was first attracted to CSCX because it has an excellent business as a manufacturer of quality cardiology […]

Read the full article →

Foreclosures do not destroy wealth

October 7, 2010
Thumbnail image for Foreclosures do not destroy wealth

Much media hay has been made over the astonishing foreclosure rate in August, as lenders took back the greatest number of homes in a month since records have been kept. Some of the language used in these articles evoked imagery of hurricanes sweeping across the nation and destroying vast stores of wealth in the form […]

Read the full article →

Rocking the cradle at Crown Crafts (CRWS)

October 2, 2010
Thumbnail image for Rocking the cradle at Crown Crafts (CRWS)

An old-fashioned proxy war has broken at infant products manufacturer Crown Crafts (CRWS). The largest shareholder, 17% owner Wynnefield Partners Small Cap Value, is fighting management to elect two representatives to the Board of Directors. Ordinarily, I would automatically side with an activist investor against entrenched management, but in this case, the activist investor in […]

Read the full article →

On the optimum holding period for value stocks

September 29, 2010
Thumbnail image for On the optimum holding period for value stocks

A recent article comparing value and momentum strategies came to a startling conclusion, that with a one month holding period, momentum outperforms value by a huge factor (see graph on right). Of course, a one month holding period is wildly inappropriate for value strategies. In fact, when a simple buy-and-hold strategy is compared to the […]

Read the full article →

ASCMA : A cash-rich play

June 20, 2010

Companies trading at below net cash on hand are favorite investigative targets of value investors. Back in the Depression era, and during the brief market bottom in 2009, such stocks were plentiful. These days, however, such net cash companies are typically trading below cash for very good reasons, most commonly, because they are losing money […]

Read the full article →

FLL : A casino that isn’t a gamble

June 13, 2010

John Paulson’s recent investment in casino stocks piqued my own interest in this sector, and I started looking for value in some of the smaller cap casino stocks. I believe that with the massive consumer retrenchment last year, 2009 should represent the generational low in casino earnings. Any casino companies that emerge from last year […]

Read the full article →

← Previous Entries

Next Entries →