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

To: James Clarke who wrote (3721)	4/1/1998 8:17:00 PM
From: Ron Bower	Read Replies (1) \| Respond to of 78523

James, You have proven that one must look at BV in initial screening of stocks. It can often find a stock beaten down for the wrong reasons. BV alone can, at times, find very good buys. My example: company bought out a company that went bankrupt. Wrote off the costs to move the equipment to a factory with lower labor costs plus they had much higher costs due to the R&D and marketing without offsetting revs. Caused two Qs of losses and the stock fell below the understated BV due to a high PE on trailing quarters. But- forward PE was under 4. Stock screening doesn't find companies like this and these are the ones we're trying to find. What found St. Joe & WHX? Wasn't the PE. For what it's worth, Ron

To: James Clarke who wrote (3721)	4/2/1998 10:09:00 AM
From: Alejandro	Read Replies (3) \| Respond to of 78523

All: We sure have some food for thought on BV. After reading all the posts, I'm convinced I need to at least use it as another indicator or an area to look at as well as fundamentals, cashflow etc. James- you did bring up something that I used to consider until I talked myself into believing that BV itself had no bearing on stock price. You pointed out that BV is carried on acquired cost. That is, bought 50 years ago. Someone else mentioned that some companies carry a higher BV. Here is where I get confused somemore. Does it mean that a company would carry todays market value for assets bought 50 years ago as BV ? As you all know, some of these threads are nuts. This one is educating me. ac