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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Allen Furlan who wrote (14031)	2/26/2002 9:23:59 PM
From: Don Earl	Read Replies (1) \| Respond to of 78710

Allen, You might find this from Zacks interesting: my.zacks.com I honestly don't know how accurate their numbers are or if their calculations are realistic. As close as I can tell, it's a ballpark guess what assets are typically worth in a liquidation, and I'd be willing to bet it's a computer generated model which doesn't include any kind of "human" analysis. I'm sure there are as many concepts of what constitutes value as there are value investors. Book value is one of the places I screen for value on the theory that if the stock represents real assets, it should be worth more. The flip side is if the assets are maxed out on leverage, book value becomes meaningless because the creditors own the assets, not the shareholders. It seems to me that an established, profitable company should show a pattern of decreasing debt. Instead what I see on a large percentage of these companies is a steady pattern of increasing debt every single quarter. If these companies are so profitable, why can't they pay their bills without borrowing more money? When a company is reporting losses, the consensus seems to be to look at cash burn as a way to establish value, but when a company is reporting profits, somehow the whole concept of cash burn goes right out the window. Maybe I'm suffering from tunnel vision, but I want to see something tangible behind my share of stock and not just bookkeeping entries. Jumping in the back of a long line of creditors and watching the line get longer in front of me every quarter isn't my idea of value.

To: Allen Furlan who wrote (14031)	2/26/2002 9:24:15 PM
From: Paul Senior	Read Replies (1) \| Respond to of 78710

Allen Furlan. I see nice moves on at least some jewelry stocks. Sorry I couldn't see/understand the buying opportunity with MAJ. It has been a better pick (so far -g-) than my choice of Tiffany (TIF, 9/28/01 post) where in retrospect, I should have taken more than a small exploratory position. finance.yahoo.com finance.yahoo.com ---- Being that you've beaten Forbes to the punch with your pick of ALU, and given that I didn't see any other stocks in article that looked interesting to me, I'd say a special trip to the library for Forbes reading is not necessary. OTOH (there's always an otoh with me -g-), Forbes is worth reading for me when I come across it at libraries, bookstores, decent supermarket magazine counters. After all, if there's even one stock in one article that the reader gloms on to, and if that stock works out, then it was very profitable and cost-effective. I'm a library user all my life after I began reading, so I can't really be comfortable saying to somebody, "Don't go to the library." (Might be different if I knew your local library was hundreds of miles from your home though.) For me, I'm lucky my local library is near where I live, so it's a nice walk for me. Here's something I found in Forbes.com (I didn't see the Ben Graham article there though): forbes.com These might be stocks that could be worthwhile for the Forbes' reader and maybe intriguing for some readers here. I'm not saying the stocks are value picks. Paul S.