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Strategies & Market Trends : Value Investing
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To: Madharry who wrote (76216)9/25/2024 9:10:25 AM
From: Harshu Vyas   of 78748
 
Profitable companies swimming in cash with no debt - to me, they're hard to go wrong with and combined in a portfolio, should work out over time. That is, unless the business economics are severely deteriorating. I don't think it's a great strategy for loss-making companies even if there's a few years of runway (a mistake I've made in the past).

The management I look for loves their company and owns a chunk of it. Will stop at nothing to improve it without taking on too much financial risk. That means slower growth but I'm prepared to swallow that "time" pill. I'm still not looking for Wall St guys to run the companies. I remember being obsessed with EVA a while back that suggests employing leverage to enhance returns - some of it makes sense, but is it always necessary and how true is it in real life (without the cherry-picked case studies)? (Speaking of EVA, O-I Glass has new management targeting economic profit. I'll watch it out of curiosity to see if such a strategy can actually transform a company the way Stewart claims.)

Speaking of Buffett/Munger one of them said they always had a "too hard" pile., meaning they did the research and determined it was too hard an investment for them to have confidence in.


That's Munger. I think I'm following the Buffet-before-Munger strategy which I think most smaller investors can follow quite robotically. Finding the companies is the hard part.
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