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

To: waver99 who wrote (48879)	7/24/2012 12:45:19 PM
From: Paul Senior	Respond to of 78748

I'm not familiar with the book or the author's model, waver99. amazon.com If you are using the valuation model and find it helpful, then that's well and good. The valuation model here for SFD makes me uncomfortable/nervous though the way I see it. SFD is processed and package meats. Not a business with a lot of pizazz or technology changes. Not a great growth business -- rather a business that plods along. Maybe a "fairly easy" business to understand and perhaps value. (If I understand the business and SFD correctly -- and I'm not saying I do.) So my expectation is that over many years of people looking at and valuing the company, somewhere along the line over several business cycles, there've been enough people buying and selling the stock to where at least fair value price has been achieved, if even for a while. It thus becomes very difficult for me to see how SFD at $18.25/sh can be valued at $33-35/sh. The stock has rarely reached that valuation number: finance.yahoo.com I'm just saying when there's that much difference between the current price and the model's valuation price for an old line stock like SFD, it seems to me to be an exaggeration. SFD could be one of those stocks where if the valuation is $33-35, I'd be with the guys who want to see a catalyst, before I'd expect the stock to hit those numbers. I'm not saying here the stock is not undervalued. It may well be, and be a good buy. After all, if someone bought at $18 and the stock rose even again to $23-$25, that could still be a good gain.