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

To: Jurgis Bekepuris who wrote (46656)	2/17/2012 12:32:42 AM
From: Spekulatius	Read Replies (1) \| Respond to of 78758

>>without noticing it: most of lifetime stock successes are small caps that grow fast and more than anyone has expected. The megacaps like NSRGY or KO or JNJ may have been lifetime stocks. They won't be such in the future. It is impossible to grow at tremendous rates at these sizes.<< Nestlé was the largest food company when I purchased my first shares. In fact they were at keystone of the largest food companies, when I first noticed found the shares in 1982. They don,t have to grow that fast (in fact they never have) but they were good at capital allocation. Ahem consistently buy back shares in particular when they are undervalued, they grow in the low singe digits organically and then add some with acquisitions. I think they can continue what they do for another 10-20 years, maybe longer.

To: Jurgis Bekepuris who wrote (46656)	2/17/2012 11:25:56 AM
From: Paul Senior	Read Replies (1) \| Respond to of 78758

Seems somewhat disingenuous to suggest value investing is not belief investing. There's belief and hope associated with almost any stock purchase. The belief that something will change (or maybe not change, eg. that an announced takeover actually occurs), something positive, to drive the stock price higher. In the long run, Graham said, the market's a weighing machine. To me that means for any value stock I'm about to buy, the belief part is that I have to believe when I go to sell it, that market participants will have bid up the price. "...most of lifetime stock successes are small caps that grow fast and more than anyone has expected." I interpret this to mean it's mostly the small caps that become lifetime successes. I believe that for most people (including me) most success with a lifetime stock will come not from rummaging among the small-cap lifetime possibilities, but rather going with the fewer larger-caps that have already established themselves.