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

To: Paul Senior who wrote (48731)	7/12/2012 2:17:14 PM
From: NikhilJog	Respond to of 78661

hahaha. naw its ok. all i was saying is that sometimes definitions are an agreement in principal but their application can be a little varied. I have made the point i wanted to make via my earlier posts. To answer your earlier post on klarman et al, I have personally met 2 of the 4 names you mentioned within the last 6 months and have spoken about their investments and discussed some of my ideas and they both look for value with catalysts. In addition, i work with a guy who worked with M Price for 1.5yrs and we talk about how he invested all the time. I know some people will now say i am tooting my own horn, but the only reason i said I have met individuals is bcs when i say value guys are looking for catalysts then i am not just saying it for the heck of saying it. Also, i do agree everyone does not not always look for catalyst. sometimes you invest with only low multiples in sight and thats "totally fine". But i don't. Low multiples are just one criteria for me to consider a stock. Value and realization of value are two different things. Either way, it was a good discussion. it got people talking about things which is always good:) Thanks Paul.

To: Paul Senior who wrote (48731)	7/12/2012 2:24:36 PM
From: Gulo	1 Recommendation Read Replies (2) \| Respond to of 78661

To change the subject... I don't normally look for "beaten down" stocks for value investing, but I'm intrigued with what is going on with the audio accessory maker Skullcandy (SKUL) at $13.85. It has rapidly growing revenues (30%+/year), no debt, and serious brand recognition. They beat each quarter earning estimate since then. Even assuming it loses some margin and market share, the forward PE <12 with est. earnings of $1.17. Recent insider buys are substantial, and it is rated a buy by the pundits. Their plan calls for expansion into Europe and Asia this year. So far, it looks like a promising stock, but there is a huge question: why does it have such a large short position? Shorters expect them to fall, and have been expecting them to fall since they went public a year ago at $20. Given that it bounced off it low of $12 five times over the last year, I would have thought shorts would have covered by now. The best explanation I've read from the short side is that "they make headphones, and headphones are a commodity". That argument sounds hollow to me. Coke makes sugar water. That doesn't make it a bad investment. I've read substantially all discussions of the stock on the internet, and just don't see the downside. Given that the company's earning look set to continue climbing for at least a few years, and that they are protected by a very good brand strategy, I'm betting that it will go up from here. A short squeeze along the way would be a bonus. Any thoughts?