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Editor's notes: CHRM is a net-net with a buyout offer on the table. With the looming twist of next year's dividend, there are multiple routes to double-digit returns.

Net-nets

One of the most obvious deep value investments are stocks of companies selling below net current asset value. This is widely known: Benjamin Graham first wrote on these stocks in his famous book Security Analysis in 1934. Other market participants noticed his success resulting in a lack of net-nets to invest in during the 1950s. This was only temporary. During the 1970s net-nets appeared again. Graham noticed and just before he died he recommended investing in net-nets again.

Less well known is that others have been verifying the statistical foundation of his investment advice. The results are astonishing: several publications find average returns of around 30% when solely investing in net-nets for 20-25 years, see for example the ...

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