Bargain Hunting: Hidden Risks in Balance Sheets

During an industry downturn, it’s common for a company to experience weak operating performance, leading to a lower stock price. While these scenarios attract bargain hunters hoping to find diamonds in the rough, based on my experience of looking at such companies, such situations should be closely scrutinized for the company's weakened financial position and potential share dilution.

Importance Of Shareholder Base

Imagine a corporation, A, that owns long-term, stable rental units, but whose shareholders are predominantly day traders. Can the managers of such a corporation have fearless nights?

Practical Uses of Inventory Accounting

Inventory accounting methods help report cost information to management and investors. They don't directly affect the physical management of the inventory operations. Yet, these methods can provide insights to general consumers of the financial world and investors.

Learnings From Mistake (#1)

A few years back I bought a company in the communications services sector. That was a mistake. I stumbled in evaluating either the fidelity or the ability of incumbent managers and, I was wrong in my evaluation of the competitive position of the company. Last year, I lost confidence in the initial investment thesis and decided to sell all my shares at a loss. Perhaps, by reflecting on what went wrong, I am hoping to avoid similar mistakes in the future.

Intrinsic Value: What Doesn't Count? Some Interesting Phenomena.

Intuitively, the concept behind intrinsic value is well understood. However, I repeatedly observe various unrelated factors get into its definition. This post will highlight two of those.