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

To: bruwin who wrote (24242)	7/6/2006 1:35:45 AM
From: Carl Worth	Read Replies (1) \| Respond to of 78958

your screen found these stocks in hindsight? obviously you didn't find these stocks one year ago, since you have never mentioned a single one of them until today...i can screen for stocks i should have bought a year ago too, so far i haven't figured out where that has much value though a bunch of them are energy stocks, you say you don't buy resource stocks because they are subject to the price of the resource, but now you highlight oil stocks? LOL...wow there's some genius, oil went from 40 bucks to 75 bucks a barrel and some energy stocks did well, tell us where oil and oil stocks will be a year from now, then you have something...next year if financial stocks are big winners due to the fed ending its rate hikes, will your "rules" change again? pick a date, and post a portfolio of 5 stocks (or 10 or 12, whatever) that you would buy THAT day at the CURRENT price on THAT day, not a bunch of could's and if's and might's, to later say you bought only the ones that went up, and you bought something like AOB at the low of the year otherwise, what you say is meaningless

To: bruwin who wrote (24242)	7/6/2006 4:39:13 PM
From: Dave	Respond to of 78958

Bruwin, Yes, HANS was a good call. As you quite rightly state, I couldn’t care if the company sold soft drinks, car parts, novelty goods etc.. etc.., just as long as it made MONEY !! True, but.... The key to understanding a business is its "entry barriers" or "moat" that protects the franchise. Companies that reside in industries with little to no entry barriers earning high Returns on Capital (or high profitablity) will fairly quickly see competition. Thus, competition will erode profitablity and, perhaps, returns on capital. The question then becomes, does HANS have a franchise with high barriers to entry? I recall in the early 90's, Snapple was, yet another, interesting franchise that was purchased by Quaker Oats. Of course, Quaker bought Snapple at its peak and it was downhill from there. Therefore, what does HANS do that no one else can copy? Is it in their distribution system? What causes them to earn those returns? Where can I purchase their products? etc. I wonder how many well-paid Fund Managers, with their multi-stock portfolios, earned even 50% of 66% for their Clients, over the same period, after deducting their "Management Fees" for all their "hard" work ? You bring up another interesting point. Some (or perhaps many) active managers are actually "closet indexers". As the saying goes, "It is better to fail conventionally, rather than unconventionally." Of course, the "pros" face what is called "career risk" if they lag an index for a period of time. If you are interested in learning more about closet indexers and career risk, I'd read what Jeremy Grantham has to say. One thing you should do and you don't have to post the results on this board is run your screen looking for stocks today and check back a year from now to see how they did. Cheers.