Many of these small, obscure companies trade at large discounts to their intrinsic values. Can these discounts be identified and exploited by value investors? Absolutely. Just four months ago, BDR was identified on this site as a potential value investment, and has been sitting on the Stock Ideas page ever since. Today, its price is more than 100% higher.
Sales of BDR's newest digital product have taken off, resulting in large 2010 Q2 profits which were announced yesterday. But investors did not have to see the success of this new product coming; for the last year, the company has been trading at a massive discount to its net current assets and its land under ownership. The patient value investor had protected his capital from downside erosion (the first rule of value investing) and had left himself plenty of room for upside should the outlook for this company change.
Sometimes, investor outlooks for companies don't change for years. In other cases, the outlook can change in a hurry. If the value investor concentrates on protecting the downside and leaving plenty of room for upside potential, he should do well in either case.
Disclosure: Author has a long position in shares of BDR