Tuesday, December 30, 2014

People Don't Learn Enough From History

I love this story from one of my favourite books, Why Nations Fail:

Elizabeth I (1558-1603) had recently issued a ruling that her people should always wear a knitted cap. Lee recorded that "knitters were the only means of producing such garments but it took so long to finish the article. I began to think. I watched my mother and my sisters sitting in the evening twilight plying their needles. If garments were made by two needles and one line of thread, why not several needles to take up the thread."

Monday, December 29, 2014

Hammond Grows Out Of Value

Almost two years ago, Hammond Manufacturing was brought up on this site as a potential stock idea. I recently sold out of the stock as the company's shares have almost doubled, while management has decided to embark on a substantial capacity expansion plan.

Wednesday, December 24, 2014

The Focused Few

My portfolio is fairly diversified. It's not that I don't understand the theory behind concentrated investing, I just don't have the confidence that I can tell the difference between a great and a good idea, and so I spread the eggs around. But I hope to get there someday. In The Focused Few, Richard Rockwood offers a few ideas on getting there.

Saturday, December 20, 2014

Aberdeen Catalyst Now In Full View

A few months ago I talked about how Aberdeen International was just begging for an activist investor. That activist appears to have arrived. A special meeting to overthrow the board has been requisitioned, and so I have bought some shares. I posted my thoughts at Seeking Alpha.

Tuesday, December 16, 2014

The Goal

I don't re-read books very often, so when I do it's because I really appreciated it the first time. I recently re-read The Goal and loved it all over again.

Friday, December 12, 2014

The Shareholder Value Myth

James Montier wrote an interesting paper about how chasing shareholder value as a firm's number one priority is a terrible idea. The paper didn't make any convincing arguments to me, as Montier both made misleading statements and tried to establish causes and effects between things with complicated relationships. Here were my issues with the paper:

Wednesday, December 10, 2014


There are a lot of reasons to hate Antifragile: the author comes across as arrogant, is verbose and uses obscure vocabulary, and goes out of his way to repeatedly insult large segments of the population. Nevertheless, I think the book is a useful read in that it helps the reader think about and understand a very useful mental model.

Thursday, December 4, 2014

Dover Downs is an Asymmetric Wager

The gaming industry in Delaware has been under severe strain for a number of years. The state government increased taxes on gaming companies to cope with budget shortfalls that ballooned as a result of the financial crisis. Meanwhile, neighboring states removed gaming license restrictions to increase their revenues, resulting in increased competition for Delaware casinos, the largest of which is Dover Downs Entertainment (NYSE:DDE).

The resulting declines in revenues and profits at Dover Downs have led to an extraordinary reduction in market value. The stock is down 90% from its 2009 highs, as casinos with fewer regulatory fees in neighboring states continue to open and eat into Dover's market share.

However, the stock is so beaten down that the company is now a bargain.Read more...

Monday, December 1, 2014


One of the founders of the web company Basecamp gives us his views on how to start and run a company in his book, Rework. I can't say I got a whole lot out of this book, but that's only because I already agreed with almost everything in it.

Wednesday, November 26, 2014

Think and Grow Rich

Napoleon Hill offers guidance for those who want to accumulate wealth in his 1937 book,Think and Grow Rich. Hill purports to have gleaned the wisdom he imparts in the book through countless amounts of time spent with very successful people.

Wednesday, November 19, 2014

Stress Test by Tim Geithner

Few people were closer to the action in the recent financial crisis than Tim Geithner. First as New York Fed President while Bush was in charge, and then as Obama's Treasury secretary, Geithner was perhaps the most influential government policy maker during the crisis. In Stress Test, he describes the events he faced in his roles and how he believes he helped reduce the economic fallout from what could have been another depression.

Friday, November 7, 2014

Zero To One

Peter Thiel co-founded Paypal, and was also the first outside investor in Facebook. Just doing one of those things is bound to make someone rich; Thiel, on the other hand, has gone on to do much more. In his book, Zero To One, he shares his thoughts on what he believes makes for a successful business.

Wednesday, November 5, 2014

Strayer Emerges From The Dust

When an entire industry takes it on the chin, the babies often get thrown out with the bathwater. As such, it can pay dividends to find the strong, quality companies that are likely to emerge from the rubble. I can't think of a better example to illustrate this than Strayer University.

Friday, October 31, 2014

Make It Stick

How I wish I had access to the contents of this book earlier in my life. It would have saved me countless hours during formal education. In Make It Stick, Peter Brown shares the scientifically asserted techniques to help you learn faster and more effectively.

Wednesday, October 22, 2014

Alco-Stores Bites The Dust

I've had a few people ask me about ALCO Stores (ALCS) recently, so I thought I would answer the questions here. ALCS used to be a net-net that eventually ended up chewing through all its assets and finally declared bankruptcy. I haven't followed it very closely over the last year, but even so I think there is a lot to be learned from this situation.

How Google Works

Eric Schmidt was Google's CEO from 2001 to 2011, which was a period of stunning growth for the technology behemoth. In How Google Works, he discusses the aspects of the company that he believes contributed to its success.

Monday, October 20, 2014

100 To 1 In The Stock Market

While the book's title is horrible, it accurately describes what the book is about. In 100 To 1 In The Stock Market, Thomas Phelps makes a case for how and why you should focus on a particular set of stocks, as they have the potential to return 100 times your investment.

Thursday, October 16, 2014

KING Of Monetization

I get positively excited when market sentiment turns negative. Although it takes a toll on my portfolio in the short-term, it provides opportunities that increase the chances of portfolio success in the future.

One such opportunity I have begun to nibble on is King Digital Entertainment (KING), maker of Candy Crush and other games for mobile phones and social networks.

Tuesday, October 14, 2014

Are Value Investors Religious?

I'm curious as to whether value investors are religious. If you're a value investor and are comfortable providing an anonymous answer in the totally unscientific poll on the right, please feel free to do so. I realize the question is ambiguous, as I'm basically just counting on you to define it as you wish. EDIT: The poll was closed after two weeks with "No" at 71% and "Yes" at 28%

Thursday, October 9, 2014

Unexpected Returns

A lot of effort has been spent trying to determine whether the stock market is over- or under-valued. But over decades and generations, what is it that leads to these extreme changes in market valuation? In Unexpected Returns, Ed Easterling identifies the factors that cause valuations to change.

Wednesday, October 8, 2014

Tesco Regrets

Just a few months ago, I discussed English grocer Tesco (OTCPK:TSCDY) as a potential value idea. The company's share price performance since then, however, has been poor. Often, when a stock I own drops in price, I welcome the opportunity to purchase more. In this case, however, a number of events within the business persuaded me to cut my losses and bail out of my position. Read more...

Friday, October 3, 2014

Karsan Value Funds: 2014 Q3 Results

Karsan Value Funds (KVF) is a value-oriented fund, as described here. Due to securities regulations, the fund is not open to the public at this time. Should that change in the future, there will be an announcement on this site.

Thursday, October 2, 2014

Experiments With Truth

There seems to be this prevailing belief that Mahatma Gandhi was this perfect person. The truth is far from it, as Gandhi tells himself in his autobiography, Experiments with Truth.

Tuesday, September 30, 2014

Aberdeen Is Asking For It

Aberdeen International (AAB) trades at half of book value. You can't blame investors, as the company's capital allocation history has been approximately horrendous. But the company recently agreed to sell what looks like the vast majority of its assets. Could this be an investment opportunity?

Wednesday, September 24, 2014

Interview with Manhattan Bridge Capital's CEO

Long-time readers of this site will recognize Manhattan Bridge Capital (LOAN) as a name that has been brought up here many times. This first-lien (up to 65% of collateral value) real-estate lender traded at a fraction of book value just a few years ago. Since then, the company's shares have catapulted upwards, and now trade at a premium to book. The company recently became a REIT, and as such it nows pays out most of its income to shareholders, and currently yields over 10%! I recently spoke with the company's CEO, Assaf Ran, and got his thoughts on where the company goes from here.

Monday, September 22, 2014

Built To Sell

For whatever reason, I do tend to enjoy business books that are structured as novels, and Built To Sell is no exception. Having started and sold four businesses, John Warrillow shares his thoughts on how to build a business that can be sold when the entrepreneur is ready to move on.

Friday, September 19, 2014

The Wide Lens

Over time, companies have become more specialized. As a result, fewer products are made completely by one company. Instead, each company is just one cog in a product ecosystem. In The Wide Lens, Ron Adner argues that this increases the risk that an execution failure that occurs *outside* the company will affect the company. This book is about how companies can manage these risks.

Tuesday, September 16, 2014

Deep Value

I really enjoyed Toby Carlisle's latest, Deep Value. There are a lot of books that offer compelling stories, but to my mind the plural of anecdote is not statistic. On the other hand, books heavy on the stats tend to bore their readers to sleep. For me, Deep Value was the perfect blend of real-life investing stories combined with the stats necessary to make for a convincing argument.

Friday, September 12, 2014

Fatal Risk

AIG had been a a responsible risk taker for much of its history. Over several decades, Hank Greenberg oversaw its growth by taking appropriately-priced risk, ensuring no single event could take the firm down. After Greenberg's ousting, some things changed at AIG. One unit in particular grew to a large size and lost its way. In Fatal Risk, Roddy Boyd tells the tale of AIG's rise and dramatic fall during the recent recession.

Wednesday, September 10, 2014

Value Fail: Premier Exhibitions

I'm able to make purchase decisions relatively easily. The decision to sell, however, is never an easy one for me, whether a stock has risen or fallen. In the case of Premier Exhibitions, I don't think it was the actual purchase that cost me; after all, this was a profitable company when I discussed the stock as a potential value investment! Instead, it was my unwillingness to sell when business conditions changed that ended up hurting the most. I wasn't actually able to sell it until I finally recognized the mental block that was stopping me from giving up.

Monday, September 8, 2014

Your Brain At Work

If you follow this blog, you know I have spent some time thinking about how to minimize external distractions (e.g. the e-mail inbox) while working. But what about the distractions that come from inside your own head? These may be even more detrimental to a focused work day than any e-mail. In Your Brain At Work, David Rock provides some techniques for improving internal focus.

Friday, September 5, 2014

Best Buy Continues To Show Progress

Just over 7 months ago, I discussed Best Buy (NYSE:BBY) as a potentially great opportunity for value investors at its then $24 share price. Today, the shares trade at $31, which represents a 30% increase. I continue to hold it, as I believe the company remains undervalued.Read more...

Thursday, September 4, 2014

The Invisible Hands

Steven Drobny interviews a number of hedge fund managers who profited through the recent financial crisis in his book, The Invisible Hands.

Wednesday, August 27, 2014

The Undercover Economist Strikes Back

Add this to the long list of books with corny titles that belie the quality of the rest of the product. I enjoyed Tim Harford's original The Undercover Economist, so I thought I'd give his new, Nate-Silver-recommended book, The Undercover Economist Strikes Back, a read and I was not disappointed.

Wednesday, August 20, 2014

First Things First

As management field pioneer Peter Drucker liked to say, labour used to be about "doing things right", but today's knowledge workers are better served by "doing the right things". How do we know what those things are? I have spent considerable time over the last few months re-arranging how I work in order to utilize my main input constraint (time!) better. First Things First is a book meant for those who think along those lines.

Friday, August 15, 2014

Getting To Yes

You may not realize it, but you likely negotiate several times day. But what do you really know about negotiating? It's not something school boards have deemed worthy of being taught, so most of us go through life learning by observing. In Getting To Yes, Roger Fisher tells us how to be better negotiators.

Tuesday, August 12, 2014

magicJack's Bag of Tricks

magicJack is a business in decline; and it's priced like it too! The shares fell to an ex-cash price-to-free-cash-flow ratio in the mid-single digits after-hours yesterday, as the company released quarterly results showing continued declines in sales of the company's hardware devices. However, I believe there is a protected downside along with some upside possibilities that are very compelling at the current price.

Friday, August 8, 2014

Business Adventures

Since Bill Gates recently called Business Adventures his favourite business book of all time, I had to give it a read. And I'm not the only one: it has become the #1 best seller in the commerce category at Amazon.

Monday, August 4, 2014

Global Value and Shareholder Yield

This is a 2-in-1 book review, not only because Global Value and Shareholder Yield were written by the same author, but also because you could read them both in an evening if you wanted to. It's not that either of these books is short on content; but they are short on fluff! I wish more books were as easy to read and as light on the rambling as these two.

Wednesday, July 30, 2014

Writing That Works

David Ogilvy, also known as the father of advertising, strongly recommended the book Writing That Works. In it, Kenneth Roman provides advice that seeks to cut out a lot of the fluff inherent in most writing today.

Monday, July 28, 2014


I was kicking myself last year for not buying Outerwall (OUTR) after Mr. Market began a panic-sale. My order missed by a few cents, and the stock subsequently soared to new heights. But now that the price has come back down to earth, I'm getting a second chance. I have begun to nibble on the company's shares, hoping for a repeat of last year's rise.

Wednesday, July 23, 2014

Creativity Inc

So you've proven yourself to be technically competent such that you've been promoted to manage other technical people. You know nothing about management; what do you do? Thus begins the management education of Ed Catmull, who would go on to become President of Pixar Animation Studios. He shares what he learned along this journey in his book, Creativity Inc.

Wednesday, July 16, 2014

The Warren Buffett Portfolio

There are a ton of books about Warren Buffett, so how does one go about determining which ones are worth reading? The way I've decided to do it is through self-selection. Not my own self, but Buffett's! When Buffett and Munger recommend a book about Buffett, which they did for The Warren Buffett Portfolio, it's probably worth reading.

Friday, July 11, 2014

Think Like A Freak

I've always been a huge fan of the Freakonomics franchise. But what attracted me to the concept was the original research the authors conducted which had resulted in some remarkable findings. In this third installment of the series, Think Like A Freak, there is much less original research, and much more regurgitation of the work of other smart authors.

Tuesday, July 8, 2014

The Comedy Bible

When something is funny, we laugh. But what is it exactly that makes something funny? I attempted to find out by reading The Comedy Bible. Judy Carter, a comedian herself, takes the reader through the steps required to write jokes.

Friday, July 4, 2014

Karsan Value Funds: 2014 Q2 Results

Karsan Value Funds (KVF) is a value-oriented fund, as described here. Due to securities regulations, the fund is not open to the public at this time. Should that change in the future, there will be an announcement on this site.

Tuesday, July 1, 2014

It Was The Comments That LICT

Less than 5 months ago, LICT Corp (LICT) was discussed on this site as a potential value investment. It was extraordinarily cheap on a multiples basis, and was (and still is) run by a renowned capital allocator, Mario Gabelli.

Friday, June 27, 2014

Made To Stick

So you have this great idea, that you know is going to make more money for you and your firm. But how will you convince your boss, his boss and your peers that it's the right approach? Your contrarian ideas tend to hold no water among regular people, who are happy with the status quo and don't want to take risks. Meanwhile, Fred in the office next door is able to push all his initiatives through. Why is that?

Tuesday, June 24, 2014

A Short History Of Nearly Everything

Do you have any idea how we know what we know about the universe? We all "know" the earth is round, and that we are closely related to apes, but where did all this knowledge come from? In A Short History of Nearly Everything, Bill Bryson describes how all of our knowledge came to be.

Tuesday, June 17, 2014

Alloy Steel: Plenty of Reason for Being Cheap, but not This Cheap

A stock I bought recently is Alloy Steel (AYSI). I can understand why it would turn off a lot of investors, but that may be why it's so ridiculously cheap.

Monday, June 16, 2014

Dacha Strategic Metals: An Exit For Some, An Arbitrage Opportunity For Others

Dacha Strategic Metals (DSM) was discussed here as a potential value opportunity just 3.5 months ago. While the company had been a destroyer of capital for several years, it came under new management with a history of good capital allocation. I'm pleased to report that shareholders have seen a share price increase of 30% since that article. Annualized, that return comes out to a cartoon-y 150%.Read more...

Wednesday, June 11, 2014

Understanding Michael Porter

Michael Porter is one of the legends of corporate strategy. Most of you are likely familiar with the Five Forces model which has his name associated with it, but he didn't stop there even though that's as far as most people go with respect to Porter. In her book Understanding Michael Porter, Joan Magretta has full access to him, including his papers, transcripts of his speeches, and interviews with Porter himself. She summarizes Porter's thoughts on strategy and competition.

Friday, June 6, 2014

List of Cannibals

Charlie Munger strongly recommends that investors "look at the cannibals", defined as companies that gobble up their own shares. I have found it difficult to find an up-to-date list of cannibals, so I decided to create one. I've picked it over (though of course, it is always changing) and so I've now decided to share it publicly going forward, here.

Thursday, June 5, 2014

Guns, Germs and Steel

Bill Gates said he was blown away by Guns, Germs and Steel. Charlie Munger also recommends it. I couldn't agree more.

Wednesday, June 4, 2014

Orange Been Squeezed

About a year ago, Orange (ORAN) was brought up on this site as a potential value investment. (Back then, we knew it as France Telecom (FTE).) Sentiment was in the toilet. A weak European economy combined with new regulations and an upstart competitor scared investors away, resulting in price to free cash flow ratios in the single digits.

Sunday, June 1, 2014

IBI Group: Now That's More Like It

Two weeks ago, I was rather dismayed. I had received what I considered to be a very poor offer from IBI Group (OTCPK:IBIBF) to revise the terms of its debentures that I hold. Because these debentures are widely held by a number of retail investors, it seemed to me that management was trying to take advantage of a group without a lot of sophistication and market power. I'm pleased to report that their gambit failed!Read more...

Wednesday, May 28, 2014

Beating The Business Cycle

Wouldn't it be nice to be able to tell six months before a recession takes place? In Beating The Business Cycle, the authors claim they can.

Friday, May 23, 2014


Successful companies use the profits from businesses that made them successful to subsidize areas in which they should not be. So says Al Ries in his book, Focus, which uses countless examples to illustrate why companies need to focus on what they do best and drop the rest.

Thursday, May 15, 2014

The Power Of Many

I don't really know what to make of Meg Whitman. On the one hand, there is this perception of her as a highly competent manager thanks to the incredible growth at eBay where she was CEO for ten years starting in 1998. On the other hand, she is also a politician (she ran for governor of California in 2010 and lost), and people who play that game are good salesmen. So is she this extraordinary manager who flawlessly executed at eBay, taking it from millions to billions, or was she lucky enough to fall into a company with tremendous network advantages while being politically astute such that she sold herself as a competent manager? Her book, The Power of Many, may offer some clues.

IBI Group Management Tries To Put One Over On Debt Holders

IBI Group's (OTCPK:OTCPK:IBIBF) 2014 debentures are due on December 31st of this year. But rather than pay them off, the company is asking debt holders for a five-year extension. To ratify the extension, the company needs 2/3's of debt holders to agree to the company's offer.

One might think that in order to secure such an extension, the company might offer superior terms (e.g. a higher interest rate); but no, the other terms offered by the company remain exactly the same.

So what is the company offering these debt holders? A proposal right out of the prisoner's dilemma handbook: a "consent fee" payment of 7 cents per dollar of par only for those who vote "yes". This egregious manner of garnering votes is unfortunately somehow legal, and the company is using this method to try to extract a deal from debenture holders that is wholly unfair. Read more...

Monday, May 12, 2014

Lean In

Warren Buffett has always been optimistic on America, as it has been able to turn human potential into wealth like no other large country. He continues to be optimistic going forward, as he believes there is still a great deal of potential yet to be unleashed. One large potential source of future wealth that is currently not being properly tapped? Women.

Thursday, May 8, 2014

Torstar Even Cheaper After Sale of Harlequin

Eight months ago, I wrote about Torstar (TS.B) as a potential value investment. While the stock is up 30% since then, I believe the company is even cheaper now than it was then. The reason: the recently announced sale of the company's Harlequin business for $455 million.Read more...

Wednesday, May 7, 2014

The Master Switch

The internet age that's upon us actually has many parallels with the introduction of other information media of previous eras. For example, at the advent of the radio, there were thousands of home-based radio stations, as hobbyists would broadcast to whoever would listen, much like bloggers today. At the advent of the telephone, hobbyists would link up entire communities in order to communicate with their neighbours.

Radio, telephones and other information media like television and cinema have all gone through "open" periods, much like where the internet is today, where it was relatively easy for anyone to participate and contribute to the growth and innovation of the medium. But these media have gone in cycles that have tended to become closed over time. Monopolists, in concert with government agencies they captured, have managed to "close" these media, raising barriers to entry that have resulted in monopolies or oligopolies. (For example, it's now a felony to broadcast a radio station without a license; nobody could have guessed this would occur at the advent of radio.) Tim Wu describes these forces, and their implications for the future of the internet, in The Master Switch.

Friday, May 2, 2014

Tesco's Price Drop Offers Excellent Value

As market multiples have expanded over the past few years, it has become increasingly difficult to find companies with moats that trade at single-digit P/E multiples. But following bad short-term news, the occasional gem does fall to the floor. Tesco (TSCDF, TSCDY), which trades over-the-counter in the US and as TSCO in London, is a terrific example.Read more...

Friday, April 25, 2014

Once Upon A Car

The storied history of the American auto industry would fill volumes. One of its bleakest periods was between 2005 and 2009, when Detroit's big three were hammered by a slew of factors that pushed two of them into bankruptcy. Once Upon A Car tells this story.

Tuesday, April 22, 2014

One Up On Wall Street

Peter Lynch posted a 29% annual return as head of the Magellan Fund through much of the 1970s and 80s. In his book, One Up On Wall Street, he tells the investor how to generate returns superior to those of Wall Street.

Tuesday, April 15, 2014

Who Says Elephants Can't Dance

I finally got around to reading the Warren Buffett recommended Who Says Elephants Can't Dance. I should have read it a long time ago; it is easily the best book by a former CEO that I've ever read.

Thursday, April 10, 2014

Fooling Houdini

One genre of book I tend to enjoy is where the author starts out as somewhat of a layman in a particular subject area, but is very passionate about this subject and ends up becoming an expert. (Is there a name for this category of book?) Previous books of this ilk that I have previously enjoyed (and highly recommend) include The Game and Moonwalking with Einstein. Alex Stone's Fooling Houdini is just as good.

Monday, April 7, 2014

Grinding It Out

Ray Kroc didn't start McDonald's (MCD), but he recognized a winner when he saw one. Kroc was a paper cup and milkshake machine salesman who was so impressed by the McDonald brothers' restaurant he called upon one day, that he dropped everything (much to the dismay of his risk-averse wife, who thus got dropped in turn) to build the company more or less into what it is today. He shares his story in his book Grinding It Out.

Friday, April 4, 2014

Karsan Value Funds: 2014 Q1 Results

Karsan Value Funds (KVF) is a value-oriented fund, as described here. Due to securities regulations, the fund is not open to the public at this time. Should that change in the future, there will be an announcement on this site.

Tuesday, April 1, 2014

Thinking Strategically

If every decision we made were in a static environment, life would be relatively easy. But in real life, others (competitors, bystanders, teammates etc) react to our decisions, which changes the environment. Enter Game Theory, which is the study of strategic decision-making. In Thinking Strategically, retired Princeton professor and economist Avinash Dixit takes the reader on a whirlwind tour of the field across a range of subjects, from business to sports to politics.

Tuesday, March 25, 2014


I recently read Creation, by Steve Grand, which came highly recommended by Amazon CEO Jeff Bezos. Grand is an expert in artificial life, but he tries to remove the "artificial" as much as possible by modeling his creations on real life, including evolution, learning and other features of real life that aren't natural to the way computers are as we know them.

Friday, March 21, 2014

Only the Paranoid Survive

One of the largest moats in the tech sector over the decades has belonged to Intel. Despite operating in a field characterized by changing and improving technologies, the company has posted double-digit returns on assets for the better part of a few of decades. In Only the Paranoid Survive, Intel's 3rd employee, and its CEO from 1987 to 1998, Andy Grove, shares some ideas on how he did it.

Tuesday, March 18, 2014

Curse of the Mogul

I was blown away by Curse of the Mogul by Knee, Greenwald and Seave. If, like me, you have enjoyed Bruce Greenwald's other books, particularly Competition Demystified, you'll probably love this one too.

Saturday, March 15, 2014

Global Sources: Special Situation + Value

Yesterday, business-to-business media company Global Sources (GSOL) announced that it would buy back $50 million worth of shares of the company at $10 per share. Nevertheless, shares of GSOL trade for just $8 despite the fact that the company trades for a P/E under 10 and operates with what appears to be a competitive advantage.Read more...

Thursday, March 13, 2014

The Emperors of Chocolate

A great deal of press is devoted to business rivalries. Coke vs Pepsi, the auto manufacturers, Amazon vs The World etc. But on one subject, the press is remarkably silent. The battle for chocolate supremacy is undoubtedly a topic dear to the hearts of many consumers, but it is one so shrouded in secrecy that there just isn't enough available on which to report. Joel Brenner put his investigative boots on and appears to have uncovered more about these secret companies (especially the privately-held Mars) than they are comfortable with. He reports his findings in The Emperors of Chocolate.

Monday, March 10, 2014

The 4-Hour Workweek

Author Timothy Ferris is one of the most resourceful people I've come across. Having been impressed by his book The 4-Hour Body a few weeks ago, I decided to check out his other book The 4-Hour Workweek, and I was not disappointed.

Thursday, March 6, 2014

Waving the White Flag on RadioShack

I think new management at RadioShack has the strategy right. They are testing out various configurations of different categories and labour models at a few concept stores, and rolling out the successful learnings to the rest of the store network. They are shutting down the least profitable stores, and cutting overall expenses. They are introducing new products (e.g. 3D printers) in an attempt to break reliance on declining categories. The problem is, it is taking too long.

Wednesday, March 5, 2014

The Art of War

I've seen Sun Tzu's The Art of War recommendations in enough business books that I figured I should finally go ahead and read it. Written some 2,000 years ago, the book is literally about how to command an army in order to win battles. But it is often argued that the concepts apply also to businesses in competition.

Tuesday, March 4, 2014

Support.Com's Price Is Far Too Low

In today's frothy market, it's not easy to find US companies trading at P/E ratios below 6. But after the giant plunge in Support.com's (SPRT) share price over the last few weeks, that's precisely where shares of SPRT sit on an ex-cash basis. The dramatic decline in Support.com's share price offers investors an opportunity to pay little for a company with a lot of potential.Read more...

Friday, February 28, 2014


When a corporate scandal is ongoing in real-time, we outsiders haven't a clue as to what's going on behind the scenes. The involved parties clam-up to protect themselves while simultaneously launching public relations campaigns to come across as innocent. But the details do come out later.

Two years ago, the Olympus scandal rocked the corporate world. Olympus' CEO at the time has now written a tell-all book called Exposure detailing how the whole thing went down.

Wednesday, February 26, 2014

Boyd: The Fighter Pilot Who Changed The Art Of War

Great men get a lot of air time, and often deservedly so. But sometimes a great man doesn't get the recognition he deserves. In John Boyd's case, he worked for an organization (the US Air Force) that deemed his work as classified. He didn't suffer fools, no matter how powerful they were, and thus made a lot of enemies who didn't want to give him credit. As a result, few people know who he is. I was blown away by his accomplishments, as told in Robert Coram's book Boyd.

Monday, February 24, 2014

Dacha New And Improved Management

For a few years now, Dacha Strategic Metals (DSM) has languished at a massive discount to its book value, and with good reason. Its previous management was a one-trick pony, having invested the bulk of the firm's assets in rare-earth metals. While this made them look like geniuses in the 2011 rare-earths bubble, the subsequent bursting of that bubble revealed these speculators for what they are: poor capital allocators.

If this same management team were still in charge of Dacha, I would probably not be invested in this company, despite the greater-than-50% discount to book value at which it trades. (Note that the bulk of this book value is made up of cash and a bunch of rare-earth metals valued at current market prices, with no leverage involved.)

Fortunately, however, shareholder activism led to the ousting of the destroyers of capital.Read more...

Friday, February 21, 2014

Different: Escaping The Competitive Herd

Harvard Business School Professor Moon provides us with an interesting take on the direction of corporate competition in her book, Different.

Tuesday, February 18, 2014

Manage Your Day To Day

For some workers, measuring their productivity is easy. If you went from 12 widgets a day last year to 11 widgets a day this year, you know you're going backwards. For knowledge workers, however, it's not that easy to tell if our productivity is improving or getting worse. With the proliferation of e-mail/sms communication and the growth of social media, I'm pretty sure my productivity was going backwards for a while there. I thought this problem of getting constantly interrupted was a problem unique to me, but it's not. With the help from others who have written on this subject, I believe I was able to take some steps to not only reverse this problem, but also create more productive time for myself. Glei's Manage Your Day To Day is useful for anyone looking to get a head start on conquering this issue.

Friday, February 14, 2014

LICT Corp Is Far Too Cheap

The fixed-line telephony business is one that should experience negative growth in the coming years, as competition from wireless carriers renders many land lines useless. As such, the market accords companies in this space low multiples, and perhaps deservingly so. But some great opportunities arise when the market paints all companies within an industry with the same brush, without regard to what may be occurring within each business.

LICT Corp (LICT) is a cash-cow that Mr. Market appears to have left for dead. But within LICT Corp is a growing telecom business that is now driving total company revenue higher, which should result in excellent risk-adjusted gains for long-term investors.Read more...

Wednesday, February 12, 2014

Income Opportunity Satisfied

Income Opportunity Realty Trust (IOT) is run pretty poorly by an apathetic management team that is poorly incentivized. So it was with much hesitation that I brought it up on this site as a potential value investment a couple of years ago, and you guys roasted me in the comments section accordingly. But somehow, this investment actually worked out to the point where I'm happy to sell and move on.

Monday, February 10, 2014

A Technique For Producing Ideas

Since most of you come here for the stock ideas, I should preface this post by saying this is not about producing stock ideas (enough of those are available here). Rather, it's about the book by James Young about producing ideas in general. He aims it at marketing people, but it is so general that I think it is useful for anyone that innovates, including people in product development, engineering, software etc.

Friday, February 7, 2014

hhgregg's Sell-Off Is Overdone

Contrarian investors know that it is the least popular stocks that make for the best long-term investments. It is difficult to find a sector that is less well-liked than consumer electronics retail, where competition has taken a bite out of the profitability of many of the industry's players.

One retailer in particular has been particularly unpopular recently. Shares of retailer hhgregg (HGG) are down over 50% in just the last two months, as the company has been severely punished by the market for reporting sales and profits that have been below the market's expectations. However, the company remains profitable despite temporary problems the company has faced. Furthermore, hhgregg continues to shift its business towards products in which the company has a competitive advantage, which should allow it to return to comparable store sales and profit growth over the next several quarters. Read more...

Tuesday, February 4, 2014

And The Money Kept Rolling In (And Out)

It is hard to believe that a few decades ago, Argentina was one of the richest countries in the world. At present, it would appear as though the country has little hope of getting back there. Crisis after crisis, caused not by Mother Nature but rather by Man himself, now seems to ravage this country every few years. A particularly noteworthy depression occurred from 1998 to 2002. In And The Money Kept Rolling In, Paul Blustein describes the environment and the events that led to the major crisis.

Wednesday, January 29, 2014

The 4-Hour Body

Timothy Ferriss basically turned his body into a laboratory. Having read all sorts of (sometimes conflicting) advice about a range of topics, including losing fat, adding muscle, healing from injuries, and improving sleep, he decided to test them out on himself and a bunch of others. Using the latest technology in advanced gadgetry, he figured out how to dramatically improve his life in many efficient and feasible ways. He gives us his results in The 4-Hour Body.

Thursday, January 23, 2014

The Outsiders

Jack Welch is a highly successful CEO, considered by many to be the greatest CEO of our time. But I would argue that he is considered so because of his charisma, charm and media-savvy. There are actually a number of CEOs who have outperformed him in a big way, but are mostly unassuming and shy from the spotlight. Eight of these are profiled in The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success.

Wednesday, January 22, 2014

Best Buy's Dip Is A Great Opportunity

It was with a heavy heart that I sold my shares of Best Buy in October. Though I had great confidence in new management's ability to continue to improve operations, the company's share price was near fair value in my estimation, and I don't like to own companies without a margin of safety. Since that article in October, however, Best Buy's (BBY) shares are down 43%, offering up another opportunity to own this company at a discount to its intrinsic value.Read more...

Monday, January 20, 2014

Refreshing Dip In The LAKE

Just 8 months ago, Lakeland Industries was brought up on this site as a potential value idea, with its shares trading at a massive discount to the company's net current assets. Today, that discount is no more, as the shares have increased in price by over 80%. As a result, Lakeland is the latest company to join the Value In Action page.

Wednesday, January 15, 2014

Wednesday, January 8, 2014

The Rise and Fall of Modern Medicine

As an investor I generally stay away from companies in the medical field. Not only are they often not in my circle of competence, but they are also usually subject to the whims of governments (patent law, regulations etc), which increases my risk as an investor. Also increasing the investor's risk is that in many cases the nature of the research results in a binary outcome: the company either hits the jackpot or is worthless. I don't have any interest in those types of issues.

Nevertheless, it doesn't mean that I would totally avoid the sector. In every sector, companies will at times trade for prices that are clearly bargains to those even with minimal industry knowledge. With that in mind, I decided to create some of that "minimal knowledge" by reading Le Fanu's The Rise and Fall of Modern Medicine.

Friday, January 3, 2014

Karsan Value Funds: 2013 Q4 Results

Karsan Value Funds (KVF) is a value-oriented fund, as described here. Due to securities regulations, the fund is not open to the public at this time. Should that change in the future, there will be an announcement on this site.