Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Harshu Vyas who wrote (74783)	1/6/2024 9:23:38 AM
From: Elroy	Read Replies (1) \| Respond to of 78485

My take is value's got harder to find in the last six months. It's all relative. The simple definition is stocks with a price to book below the average are value stocks. Define it in relative terms, and there's always plenty of value stocks to choose from.

To: Harshu Vyas who wrote (74783)	1/6/2024 10:36:42 AM
From: Paul Senior	Read Replies (1) \| Respond to of 78485

Buying DELL? I can't see it as a growth stock or as a value stock. A pick to assist goal of 50% gain in portfolio by year-end? I definitely don't see that. Of course it's what you see, not what I see. My opinion though: the first pick = the first mistake

To: Harshu Vyas who wrote (74783)	1/6/2024 10:52:34 AM
From: E_K_S	Respond to of 78485

Re: Value vs Growth especially over years I tend to somewhat agree with your observations but the "elephant in the room" is Inflation. Specifically STAGFLATION and the impact on the stock price. Just holding assets, you generally see stock prices higher due from inflation not because of growing earnings (adjusted for inflation), FCF and/or Sales (again adjusted for inflation). So, if you can make your BUYs where PE's are at/near 10 year rate (I tend to use PE's < 10x or PE's at a significant discount to the $SPX market PE) and then buy & hold; your returns s/d at least increase w/ the general inflation (especially if a consumer durable w/ pricing power). So, do you sell if price appears 'over valued' based on PE expansion or other factors? I conclude probably NOT! In the past I would sell and deploy those proceeds into other Buys which might reflect Value (when measured vs $SPX). As an example look at Waste Management(WM); your standard garbage company. It does have a moat as typically they are the only collector in the area, have long term City contracts and can raise rates but only to stay up w/ inflation. Then Why should WM have a 31x PE? This seems unusually high. That is why I sold my shares in 2019 at/near $80/share (bought them in 2012 at $28/share) +185% in 7 years (13.6 % CAGR). The total inflation from 2012 through 2019 was 11.5% (1.65% YoY)! So YES a CAGR of 13.6% is GREAT but your 'real rate' of return is lower closer to $11.75%. So should WM demand a 31x PE? Pretty high debt too w/ Debt/Equity at 2.2x. selling 10x BV. Maybe just another argument to Buy & hold and never sell. I left 100% on the table for selling at $80/share as I thought a 31x PE was over valued.

To: Harshu Vyas who wrote (74783)	1/6/2024 11:39:45 AM
From: Madharry	Respond to of 78485

I think there is group think on the part of growth fund managers that makes them overpay for growth that they think is assured. I think part of it is that they are more penalized for not owning a high flyer that keep on growing than they are for being blindsided by a company whose growth is clearly slowing. I think that is why Apple continues to flourish at the level its at. And there is a willingness to pay enormous multiples for expected growth. As far a value being harder to find I looked at two small cap value etfs and they both went up 20-25% in the last six weeks of 2023, OT the expansion of starbucks is impressive. where I live there is a Starbucks in almost every supermarket I go to.