Revisiting Craven House $CRV.L

Revisiting Craven House $CRV.L

I haven’t look at CRV for a while, and it was recently covered by another blogger, Expecting Value, which takes the count now to two bloggers that have been skeptical of CRV. I thought I would write a post setting out my thesis again and particularly addressing the issue raised that CRV could be inflating the valuation of its balance sheet.read more

Cigar Butts and Turnarounds

Cigar Butts and Turnarounds

Last week I was holidaying in France, and when I go away I like to take a stack of reading that I don’t normally have time for. Among my stack were Buffett’s shareholder letters; I’ve read them before but they are always worth a re-read. Upon reading them I came across his thoughts on ‘cigar butt’ investing and wanted to do an article on them because there seems a lot of mis-information about them floating on the web.

I have never been a fan of ‘cigar butts’, and if I recall my positions that have had the highest gains, these have been in growing and strong companies. The market seems to realise true value far more quickly when a company is performing well – and if it doesn’t the business is growing intrinsic value for every year you are waiting.read more

AIM IT Project ($GLIF.L, $POLR.L, $EWG.L)

AIM IT Project ($GLIF.L, $POLR.L, $EWG.L)

It’s been a while since I’ve gone over some actual stocks on here, having a low cash balance in my portfolio sort of removes the motivation to research new companies. But it’s about time I got back to the AIM IT Project.read more

House Buying vs Renting

House Buying vs Renting

In my last article on the ‘Best Investment for you’ I considered John Paulson’s advice for investors to buy a home. I focused a lot on how to value a house using rental yield to get an idea of whether or not you are overpaying for an asset. What I didn’t do was consider whether John Paulson’s advice was sensible or not and a lot of the discussion in the comments focused on house buying vs renting. So I’m going to rewind and address that question. The easiest way of doing this is to crunch the numbers – lucky for you I’ve tried to do as much of the hard work as possible and here is a model of buying vs renting costs with customizable inputs.read more

The best and biggest investment for you

The best and biggest investment for you

John Paulson gave an interview on CNBC in which he described the “best investment for a retail investor”. To some it may come as a surprise that this wasn’t some stock or bond, it was to buy a home (or primary residence).

For many this will represent a large investment, possibly larger than the whole of their equity investments put together. So why is John Paulson saying it is a good idea?

Well over a period of 20-30 years the chances of house prices being below where you buy are minimal due to inflation, but in the short term it can create financial pressure on you. I look at how you can assess house prices in the short term and estimate intrinsic value.read more

Technical Analysis for the Value Investor

Technical Analysis for the Value Investor

I like to think of myself as open-minded, I try to not to let my pre-existing biases get in the way of learning new things and new ideas. But I also like to think of myself as a skeptic – unless someone can show evidence or proof that an idea is correct, I’ll have a hard time accepting it.

So when it comes to Technical Analysis you can see why I am of two conflicting minds. Like most value investors, I have a tendency to dismiss TA and just focus on valuation, but after attending some friendly get togethers with other investors in London I discovered there are people out there that have been using TA to make money for decades – maybe there is something to this TA after all?read more

When cash isn’t really cash – $BDL

When cash isn’t really cash – $BDL

I recently ran one of my stock screens in the US to try and find some overlooked companies and I came across one company, Flanigan’s Enterprises ($BDL) which runs a chain of restaurants. It appeared cheap on an EV/EBITDA basis, but on further investigation wasn’t appealing. I wanted to go over it because it’s a great example on how investors can get caught out relying on such multiples without doing further research. The problem is: when is a company’s cash really free cash and not an essential business asset?read more

Where to invest?

Where to invest?

If you regularly search for undervalued companies then it probably hasn’t escaped your notice that the US and UK markets are trading at much higher valuations than they were a few years ago. That makes it harder to find bargains – but not impossible. But rather than try harder, why not start looking at cheaper markets? Here are 30 international markets and their valuations.read more

Half year portfolio report

Half year portfolio report

It’s that time of year again, I review my portfolio performance every 6 months as a compromise between short term volatility and waiting too long between reviews. The first half of 2014 has been a bit of a roller coaster for my portfolio, driven mainly by swings in the price of my biggest holding Craven House Capital. The rest of the portfolio has been much smoother, seeing nice steady gains.read more

The Blog Experiment (part 2)

The Blog Experiment (part 2)

In the Blog Experiment article I went through the 2012 results of a portfolio that follows the buys and sells of my favorite bloggers. Here are the final results up to 30th June 2014.read more

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