Value investors usually buy stocks that, for one reason or another, have something “wrong” with them. That “issue” is often what makes them so cheap. But sometimes the market is right and the thing that is “wrong” is a truly big issue and the stock is “cheap for a reason.” It’s easy for a value investor to buy a stock all the way down that is fundamentally flawed for a reason they identified and brushed off at their first purchase, even though the issue becomes more and more apparent as time passes.
Really enjoyed this article. Obviously it specifically relates to VC, but it’s interesting to think how investors (be they activists, private equity, VC, or typical value investors) are increasingly being asked to bring something other than “just money” to the table when making an investment.
With the recent pullback hitting small cap stocks especially hard, I thought I’d do a post on where I’m seeing the best values. Now, a lot of people like to do posts on what their “best ideas” are, but I personally think that the best ideas are places where an investor is actually putting cash to work and currently buying. With that in mind, here are a few positions I’ve been adding to over the past few weeks. Continue reading
Always worth a read for potential special situation ideas.
I’ve written about Repro-med (REPR) a few times. The write ups generated significant reader interest, and the stock has run up quite a bit since those articles were published, so I thought I’d highlight this very in depth look at the company.
Disclosure- Long REPR. REPR is a microcap; please do your own research and use limit orders.
Transcript of the sequoia fund annual meeting. An absolute terrific read; i learned a significant amount about several businesses in a very short time frame.
Last month I posted about my long position in HCHC. Since that time, HCHC has been on an incredible deal spree which has driven their stock up around 30%. I thought this article was a good look at the potential sum of the parts, and thought the use of the credit docs to estimate some of the potential EBITDA amounts was excellent.
That said, I have sold a good bit of my position. While I think there’s a ton of upside, I also think there’s certainly some increased risk given the higher share price, higher leverage, and rapid deal pace.
Disclosure: Long HCHC