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Pastimes : Makin' money honey -- Ignore unavailable to you. Want to Upgrade?

To: sandintoes who wrote (1883)	11/28/2005 6:28:26 AM
From: stock leader	Read Replies (1) \| Respond to of 2260

I agree with the sentiments in this article... I can't find any good sub-book value stocks... there really are no deep value stocks right now . . . . . Value investors struggle to find stocks Friday November 18, 5:10 pm ET By Dane Hamilton NEW YORK (Reuters) - Investor Seth Klarman is a patient man. Which is good, because as president of the $5.4 billion investment group Baupost Group, he isn't finding much to buy these days. About 45 percent of his Boston-based fund is in cash, waiting for good companies to fall from investor favor. ADVERTISEMENT "At times, it is like watching paint dry," Klarman lamented this week at the Value Investing Congress, billed as the largest conference focused on the investment strategy next to Warren Buffett's annual meeting of Berkshire Hathaway Inc. (NYSE:BRK-A - News) in Omaha. But while the world's second-richest man wasn't to be seen among a crowd of hundreds of hedge fund and investment group financiers at the New York conference, Buffett's presence loomed large as the shining example of the success of value investing. In concept, Buffett-style value investing sounds simple -- buy and hold companies when they dip to trade for less than their "intrinsic" value. But in reality, it is far from easy, participants said. "There's only one problem," said Richard Pzena, founder of the $10 billion Pzena Investment Management, billed as a top-performer among value investors. "Good businesses don't sell for low prices." Still, amid the line-up of value investing luminaries, there were many ideas. Ken Shubin Stein, founder of Spencer Capital Management, for instance, touted an investment thesis for shoe retailer Foot Locker Inc. (NYSE:FL - News). And Whitney Tilson, managing director of T2 Partners and a conference organizer, spent an hour with T2 colleague Glenn Tongue explaining why Berkshire Hathaway at $89,550 per share is a steal. If historical trends pan out, the Buffett- controlled conglomerate, which has never had a share split, should soon trade at $120,000 per share, Tilson and Tongue said. For those less inclined to fork out for a few hundred shares of Berkshire Hathaway, waiting for the market to change may be the best strategy, some said. Baupost's Klarman, for example, said his firm holds only about a half-dozen U.S. securities, including Starwood Hotels & Resorts Worldwide Inc. (NYSE:HOT - News) notes and Catalytica Energy Systems Inc. (NasdaqNM:CESI - News) stock. But Klarman said underlying factors, including "artificially low" interest rates, a housing "bubble" and an "irresponsible cheerleader" in Federal Reserve Chairman Alan Greenspan, may conspire to cause the market to drop and give those investors with cash their day in the sun. "I believe the world is setting up for an avalanche of opportunity," said Klarman, whose fund boasts compounded returns of 19.5 percent net to investors over 23 years. "When the market overreacts, we want to be quickly moving to that opportunity."