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Strategies & Market Trends : Value Investing

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To: Spekulatius who wrote (48712)	7/11/2012 7:24:53 PM
From: Sergio H	Read Replies (1) of 78666

I can understand not needing catalysts, but I can't see buying a stock just based on its metrics. Cheap metrics does not = value. HPQ is a good example. Recently we both agreed that HPQ had attractive metrics but found that there are reasons why the stock is selling so cheaply and may be considered unattractive. Value implies that you are buying something at a cheaper price than it is worth. HPQ is properly priced at the moment despite its cheap metrics. HPQ has cheap metrics but it is not a value stock. Same argument came up recently with JCP and if you look back on this thread GLW and WM to name a few. In each case you have to find if there is value not recognized by the market, maybe because of an event that was anticipated that did not occur, or perhaps there was a temporary setback that has been addressed or how about the co. has made improvements that have not been recognized. Not potential catalysts, but an argument that the stock is worth more than its current price because.... is needed beyond a review of the metrics.

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