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  • Mattel's Yield Is More Than Just Fun And Games [View article]
    Benjamin Graham was a scholar and financial analyst who mentored legendary investors such as Warren Buffett, William J. Ruane, Irving Kahn and Walter J. Schloss.

    Graham emphasized that the secret of sound investment was the "Margin of Safety". He recommended various categories of stocks - Defensive, Enterprising and NCAV - and specified precise qualitative and quantitative rules for each category.

    For example, given below are the actual Graham ratings for Mattel Inc (MAT).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    Mattel Inc - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 1,296.00%
    Current Assets ÷ [2 x Current Liabilities]: 161.26%
    Net Current Assets ÷ Long Term Debt: 145.66%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 100.00%
    Earnings Growth (100% ⇒ 30% Growth): 136.44%
    Graham Number ÷ Previous Close: 69.88%

    Mattel Inc ranks very highly by Graham's qualitative rules, but exceeds Graham's quantitative limits.

    Warren Buffett once wrote an article describing how Benjamin Graham's long record of tutoring exceptional investors (such as Buffett himself) is irrefutable. The article is called "The Superinvestors of Graham-and-Doddsville".

    http://seekingalpha.co... shows how one can screen 5000+ NYSE and NASDAQ stocks today by an exact 17-point Benjamin Graham assessment.
    Nov 24, 2014. 03:06 PM | Likes Like |Link to Comment
  • ModernGraham Quarterly Valuation Of Facebook Inc. [View article]
    The ModernGraham website lists the following formula as one of the evaluation methods it uses:
    Intrinsic Value = EPS x (8.5 + 2xGrowth)

    Benjamin Graham actually gave several warnings about this formula and only used it to demonstrate why oversimplified growth estimates are unreliable. But due to a printing omission in recent editions of The Intelligent Investor, this formula is used often today instead of Graham's actual (and more thorough) methods.

    Article 1: http://seekingalpha.co... discusses the issue in detail.

    Warren Buffett once wrote an article describing how Benjamin Graham's long record of mentoring exceptional investors (such as Buffett himself) is irrefutable. The article is called "The Superinvestors of Graham-and-Doddsville".

    Buffett even named his son after Graham, and describes Graham's book - The Intelligent Investor - as "by far the best book about investing ever written".

    But most of what Graham actually taught has been forgotten today, or is applied incorrectly.

    For example, note another criterion used in the above article:
    "Adequate Size of Enterprise - market capitalization of at least $2 billion."

    Graham actually recommended "Not less than $100 million of annual sales" for this criterion.

    Checking for market capitalization instead will - all other things being equal - rate overvalued stocks better than undervalued ones. Other rules mentioned here too - such as dividend record, and PE & PB ratios - are all very different from what Graham actually recommended.

    Graham emphasized that the secret of sound investment was the "Margin of Safety". He spent nearly 50 years developing, backtesting and refining the investment framework that has withstood the test of time, and has been endorsed by some of the world's most successful investors. Modifying Graham's rules so heavily thus seems very ill-advised.

    Given below are the actual Graham ratings for Facebook Inc (FB), with no modifications other than adjustments for inflation.

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    Facebook Inc - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 1,574.00%
    Current Assets ÷ [2 x Current Liabilities]: 594.09%
    Net Current Assets ÷ Long Term Debt: 100.00%
    Earnings Stability (100% ⇒ 10 Years): 30.00%
    Dividend Record (100% ⇒ 20 Years): 0.00%
    Earnings Growth (100% ⇒ 30% Growth): 0.00%
    Graham Number ÷ Previous Close: 9.84%

    Article 2: http://seekingalpha.co... shows how one can screen 5000+ NYSE and NASDAQ stocks, by a similar unaltered Benjamin Graham assessment.
    Nov 23, 2014. 11:52 AM | 3 Likes Like |Link to Comment
  • Is Exxon Mobil Stock A Buy Right Now? [View article]
    Thank you again for an interesting comment, charliezap!

    In the "An hour with Mr. Graham" interview in 1976, Graham says:

    "The thing that I have been emphasizing in my own work for the last few years has been the group approach. To try to buy groups of stocks that meet some simple criterion for being undervalued-regardless of the industry and with very little attention to the individual company.................. I found the results were very good for 50 years. They certainly did twice as well as the Dow Jones. And so my enthusiasm has been transferred from the selective to the group approach."

    Graham evolved the approach of applying the same criteria - regardless of the industry or business model - over a period of decades as an improvement to more complicated methods of stock analysis.
    Nov 22, 2014. 04:47 PM | Likes Like |Link to Comment
  • Intel Investor Meeting Generates Big News [View article]
    Hello Rich,

    Thank you for your comment!

    Munger's influence on Buffett has been discussed often. In fact, Munger has even made some unflattering comments about Graham.

    But Buffett himself has always credited Graham for his investment framework. Serenity's analyses are based on what Buffett has said about Graham, and on what Graham taught.

    Incidentally, Warren Buffett's timeline mentions:
    "1983: Berkshire begins the year at $775 per share, and ends at $1,310. Warren's personal net worth is $620 million."

    He wasn't a billionaire in 1984 but he was close.
    In fact, when adjusted for inflation, $620 million in 1983 evaluates to about $2.5 billion.
    Nov 21, 2014. 04:28 PM | Likes Like |Link to Comment
  • ModernGraham Annual Valuation Of American Electric Power Company Inc. [View article]
    The ModernGraham website lists the following formula as one of the evaluation methods it uses:
    Intrinsic Value = EPS x (8.5 + 2xGrowth)

    Benjamin Graham actually gave the following warnings about this formula:
    1. "Warning: This material is supplied for illustrative purposes only".
    2. "Let the reader not be misled into thinking that such projections have any high degree of reliability".
    3. "Note that we do not suggest that this formula gives the “true value” of a growth stock".

    Graham only used this formula to demonstrate why oversimplified growth estimates are unreliable. But due to a printing omission in recent editions of The Intelligent Investor, this formula is often used today instead of Graham's actual (and more thorough) methods.

    Article 1: http://seekingalpha.co... discusses the issue in detail.

    Warren Buffett once wrote an article describing how Benjamin Graham's principles are everlasting, and his students consistently exceptional. The article is called "The Superinvestors of Graham-and-Doddsville".

    But most of what Graham actually taught has been forgotten today, and things he warned against are often attributed to him instead. The above formula is just one example. Even when Graham's recommended methods are used, they are heavily modified - often beyond recognition - to clear the stocks, rather than having stocks clear them.

    For example:
    "Adequate Size of Enterprise - market capitalization of at least $2 billion."

    Graham actually recommended "Not less than $100 million of annual sales" for this criterion. Checking for market capitalization instead will - all other things being equal - rate overvalued stocks higher than undervalued ones.

    Even the other rules mentioned here - such as dividend record, and PE & PB ratios - are all very different from what Graham actually recommended.

    Given below are the actual Graham ratings for American Electric Power (AEP).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    American Electric Power - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 3,072.00%
    Current Assets ÷ [2 x Current Liabilities]: 35.26%
    Net Current Assets ÷ Long Term Debt: 0.00%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 100.00%
    Earnings Growth (100% ⇒ 30% Growth): 96.97%
    Graham Number ÷ Previous Close: 88.02%

    Graham emphasized that the secret of sound investment was the "Margin of Safety". He recommended various categories of stocks - Defensive, Enterprising and NCAV - and specified precise qualitative and quantitative rules for each category.

    Article 2: http://seekingalpha.co... shows how anyone can do a true 17-point Benjamin Graham assessment for 5000+ NYSE and NASDAQ stocks; with no adjustments other than those for inflation.
    Nov 21, 2014. 03:30 PM | 1 Like Like |Link to Comment
  • Mattel Has Huge Margin Of Safety For Dividend Investors [View article]
    Benjamin Graham was a scholar and financial analyst who mentored legendary investors such as Warren Buffett, William J. Ruane, Irving Kahn and Walter J. Schloss.

    Graham emphasized that the secret of sound investment was the "Margin of Safety". He recommended various categories of stocks - Defensive, Enterprising and NCAV - and specified precise qualitative and quantitative rules for each category.

    For example, given below are all Graham ratings for Mattel Inc (MAT).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    Mattel Inc - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 1,296.00%
    Current Assets ÷ [2 x Current Liabilities]: 161.26%
    Net Current Assets ÷ Long Term Debt: 145.66%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 100.00%
    Earnings Growth (100% ⇒ 30% Growth): 136.44%
    Graham Number ÷ Previous Close: 69.88%

    Mattel Inc ranks very highly by Graham's qualitative rules, but exceeds Graham's quantitative limits.

    Warren Buffett once wrote an article describing how Graham's principles are everlasting, and his students consistently exceptional. The article is called "The Superinvestors of Graham-and-Doddsville".

    http://seekingalpha.co... shows how anyone can do a true 17-point Benjamin Graham assessment for 5000+ NYSE and NASDAQ stocks; with no adjustments other than those for inflation.
    Nov 21, 2014. 03:09 PM | 2 Likes Like |Link to Comment
  • Intel Investor Meeting Generates Big News [View article]
    Benjamin Graham was a scholar and financial analyst who mentored legendary investors such as Warren Buffett, William J. Ruane, Irving Kahn and Walter J. Schloss.

    Graham emphasized that the secret of sound investment was the "Margin of Safety". He recommended various categories of stocks - Defensive, Enterprising and NCAV - and specified precise qualitative and quantitative rules for each category.

    For example, given below are all Graham ratings for Intel Corp (INTC).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    Intel Corp - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 10,542.00%
    Current Assets ÷ [2 x Current Liabilities]: 118.23%
    Net Current Assets ÷ Long Term Debt: 140.65%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 95.00%
    Earnings Growth (100% ⇒ 30% Growth): 143.72%
    Graham Number ÷ Previous Close: 68.85%

    Intel Corp ranks very highly by Graham's qualitative rules, but exceeds Graham's quantitative limits.

    Warren Buffett once wrote an article describing how Graham's principles are everlasting, and his students consistently exceptional. The article is called "The Superinvestors of Graham-and-Doddsville".

    http://seekingalpha.co... shows how anyone can do a true 17-point Benjamin Graham assessment for 5000+ NYSE and NASDAQ stocks; with no adjustments other than those for inflation.
    Nov 21, 2014. 03:02 PM | Likes Like |Link to Comment
  • Coach - Plenty Of Positives, But The Shares Will Likely Fall Further [View article]
    Benjamin Graham was a scholar and financial analyst who mentored legendary investors such as Warren Buffett, William J. Ruane, Irving Kahn and Walter J. Schloss.

    Graham emphasized that the secret of sound investment was the "Margin of Safety". He recommended various categories of stocks - Defensive, Enterprising and NCAV - and specified precise qualitative and quantitative rules for each category.

    For example, given below are all Graham ratings for Coach Inc (COH).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    Coach Inc - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 1,016.00%
    Current Assets ÷ [2 x Current Liabilities]: 143.31%
    Net Current Assets ÷ Long Term Debt: 269,680.00%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 25.00%
    Earnings Growth (100% ⇒ 30% Growth): 253.72%
    Graham Number ÷ Previous Close: 71.18%

    Coach Inc ranks well by Graham's qualitative rules, but does exceed Graham's quantitative rules.

    Warren Buffett once wrote an article describing how Graham's principles are everlasting, and his students consistently exceptional. The article is called "The Superinvestors of Graham-and-Doddsville".

    http://seekingalpha.co... shows how anyone can do a true 17-point Benjamin Graham assessment for 5000+ NYSE and NASDAQ stocks; with no adjustments other than those for inflation.
    Nov 21, 2014. 02:58 PM | Likes Like |Link to Comment
  • Why Halliburton Stock Is A Good Investment Opportunity [View article]
    Hello gymbo,

    If you see Serenity's full Graham assessment for Halliburton Company, you'll see that HAL ranks very highly by Graham's qualitative rules but does not clear Graham's quantitative rules at the present time.

    Also, Graham prescribed very different strategies for highly experienced, well-connected and institutional investors. For details, please see the section on "Special Situations" in http://seekingalpha.co...

    Thank you.
    Nov 21, 2014. 02:47 PM | Likes Like |Link to Comment
  • Why Halliburton Stock Is A Good Investment Opportunity [View article]
    Benjamin Graham was a scholar and financial analyst who mentored legendary investors such as Warren Buffett, William J. Ruane, Irving Kahn and Walter J. Schloss.

    Graham emphasized that the secret of sound investment was the "Margin of Safety". He recommended various categories of stocks - Defensive, Enterprising and NCAV - and specified precise qualitative and quantitative rules for each category.

    For example, given below are all Graham ratings for Halliburton Company (HAL).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    Halliburton Company - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 5,880.00%
    Current Assets ÷ [2 x Current Liabilities]: 136.33%
    Net Current Assets ÷ Long Term Debt: 111.03%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 100.00%
    Earnings Growth (100% ⇒ 30% Growth): 144.68%
    Graham Number ÷ Previous Close: 69.05%

    Halliburton Company ranks very highly by Graham's qualitative rules.

    Warren Buffett once wrote an article describing how Graham's principles are everlasting, and his students consistently exceptional. The article is called "The Superinvestors of Graham-and-Doddsville".

    http://seekingalpha.co... shows how anyone can do a true 17-point Benjamin Graham assessment for 5000+ NYSE and NASDAQ stocks; with no adjustments other than those for inflation.
    Nov 21, 2014. 01:21 PM | 2 Likes Like |Link to Comment
  • Universal Corporation Is Set To Outperform [View article]
    Benjamin Graham was a scholar and financial analyst who mentored legendary investors such as Warren Buffett, William J. Ruane, Irving Kahn and Walter J. Schloss.

    Graham emphasized that the secret of sound investment was the "Margin of Safety". He recommended various categories of stocks - Index, Defensive, Enterprising and NCAV - and specified precise qualitative and quantitative rules for each category.

    For example, given below are all Graham ratings for Universal Corporation (UVV).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    Universal Corporation - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 508.00%
    Current Assets ÷ [2 x Current Liabilities]: 183.87%
    Net Current Assets ÷ Long Term Debt: 507.58%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 100.00%
    Earnings Growth (100% ⇒ 30% Growth): 142.00%
    Graham Number ÷ Previous Close: 175.23%

    Warren Buffett once wrote an article describing how Graham's principles are everlasting, and his students consistently exceptional. The article is called "The Superinvestors of Graham-and-Doddsville".

    http://seekingalpha.co... shows how anyone can do a true 17-point Benjamin Graham assessment for 5000+ NYSE and NASDAQ stocks; with no adjustments other than those for inflation.

    In short, of 5000+ stocks analyzed using Graham's 17 rules today, Universal Corporation is one of the highest rated. Possibly, "the" highest.

    Thank you.
    Nov 21, 2014. 01:09 PM | 1 Like Like |Link to Comment
  • Recent Buy: National Oilwell Varco, Inc. [View article]
    A closer reference would be "The Battle of Serenity Valley", CapeCapMgmt.

    See if you can find the Firefly reference on the site. Drop a line using the contact form if you do, and get a free 1-year membership to Serenity's Advanced Graham Screener.

    Thank you.
    Nov 21, 2014. 11:22 AM | Likes Like |Link to Comment
  • Is Exxon Mobil Stock A Buy Right Now? [View article]
    Thank you for the disclosure, charliezap.
    That's quite a story!

    Warren Buffett wrote "The Superinvestors of Graham-and-Doddsville" describing how Graham's principles are everlasting, in 1984 (30 years ago).

    Also, given below is part of the conclusion from the study "The Evolution of the Idea of Value Investing: From Benjamin Graham to Warren Buffett" by Robert F. Bierig, Duke University:

    "A [casual] observer of Buffett today would find it difficult to see the Ben Graham influence in many of his activities. However, that influence remains at the core of Buffett's investment model. Buffett continues to think about stocks as fractional ownership interests in underlying businesses, he continues to operate under the assumption that there is a distinction between price and value, and he continues to search for the largest discrepancy between those two items. In other words, he continues to be a value investor."

    NCAV stocks are the most well-known of Graham's strategies, and the source of the general misconception that Graham only recommended cheap stocks.

    But Graham actually recommended Index, Defensive and Enterprising stocks before NCAV stocks; and all of them were allowed higher Quantitative valuations and required greater Qualitative checks than NCAV stocks.

    Graham did advocate paying more for Quality. His only prerequisite was that there be the Margin of Safety between price and value, whether the value be Qualitative or Quantitative.

    Also, the earlier comment that was not meant to imply that all stocks not clearing Graham's rules are bad! There are many schools of thought one can follow to invest successfully.

    Graham's rules are just extremely selective, that's all. Even for a stock that doesn't clear them, the Graham ratings gives a point of reference as to how the stock compares against others.

    Thank you.
    Nov 21, 2014. 11:01 AM | 1 Like Like |Link to Comment
  • Dividend Aristocrats In Focus Part 39: AT&T [View article]
    That critique has already been responded to in the comment before the previous one, BuffaloWingswithRanchD...

    Please follow whatever methodology suits you best.
    Serenity is specifically designed for those interested in Graham's principles.

    Thank you.
    Nov 21, 2014. 08:08 AM | Likes Like |Link to Comment
  • Dividend Aristocrats In Focus Part 39: AT&T [View article]
    "Not at the moment, because Graham says so."
    Just eight words.

    All analyses on Serenity follow Graham faithfully, BuffaloWingswithRanchD...

    Nothing more, nothing less.

    Thank you.
    Nov 21, 2014. 07:50 AM | 1 Like Like |Link to Comment
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