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  • ModernGraham Quarterly Valuation Of JPMorgan Chase [View article]
    The ModernGraham website cites the following formula as one of the Graham methods applied:

    Intrinsic Value = EPS x (8.5 + 2xGrowth)

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

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

    In fact, most of what Graham actually taught has been forgotten today, or is applied inaccurately.

    Another example from the above article is:
    "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 of Sales will - all else being equal - rate overvalued stocks higher than undervalued ones. Other rules mentioned here too - such as dividend record, and PE & PB ratios - are very different from what Graham actually recommended.

    Given below are the actual Graham ratings for JPMorgan Chase & Co (JPM), with no adjustments other than those for inflation.

    Defensive Graham investment requires that all ratings be 100% or more.
    Enterprising Graham investment requires minimum ratings of - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    JPMorgan Chase & Co - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 18,213.20%
    Current Assets ÷ [2 x Current Liabilities]: 1.20%
    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): 103.60%
    Graham Number ÷ Previous Close: 21.72%

    Please note that not all stocks failing Graham's rules are necessarily bad investments. Graham's rules are just extremely selective. Graham designed and backtested his framework for over 50 years, to deliver the best possible long-term results.

    Even when stocks don't clear them completely, Graham's rules give a clear and quantifiable frame of reference for measuring a stock's margin of safety.

    Article 2: http://seekingalpha.co... shows how one can assess 5000+ NYSE and NASDAQ stocks by a similarly precise 17-point Benjamin Graham assessment, with no adjustments other than those for inflation.
    Feb 28, 2015. 04:10 PM | 3 Likes Like |Link to Comment
  • High-Quality Value Investing With Benjamin Graham [View article]
    Thank you, maybenot!

    Irving Kahn, one of Graham's earliest students, passed away on Tuesday.
    Unfortunately, this article was published before a note about Kahn's passing could be included.

    To quote a line from yesterday's Bloomberg article on Kahn's passing:
    "In 2012, at 106, Kahn told Bloomberg Businessweek that Graham’s principles, though relevant as ever, were increasingly being drowned out by noise."

    But for those of us who can tune out the noise, that's not necessarily a bad thing.

    After all, as Buffett wrote in the Preface to The Intelligent Investor:
    "The sillier the market’s behavior, the greater the opportunity for the business-like investor. Follow Graham and you will profit from folly rather than participate in it."
    Feb 27, 2015. 02:53 PM | 3 Likes Like |Link to Comment
  • Here's Why Wabtec Belongs In Your Portfolio [View article]
    Benjamin Graham actually 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.

    Earnings power was one of the rules included in his investment framework.

    For example, given below are the actual Graham ratings for Wabtec Inc (WAB), with no adjustments other than those for inflation.

    Defensive Graham investment requires that all ratings be 100% or more.
    Enterprising Graham investment requires minimum ratings of - N/A, 75%, 90%, 50%, 5%, N/A and 137%.

    Wabtec Inc - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 514.00%
    Current Assets ÷ [2 x Current Liabilities]: 115.03%
    Net Current Assets ÷ Long Term Debt: 167.36%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 95.00%
    Earnings Growth (100% ⇒ 30% Growth): 312.71%
    Graham Number ÷ Previous Close: 36.92%

    The Final Graham Assessment for Wabtec Inc is also given below.
    The Quantitative Result (Intrinsic Value ÷ Previous Close) for a stock has to be 100% for true Graham investment.

    Wabtec Inc - Final Graham Assessment
    Defensive Price (Graham Number): $31.25
    Enterprising Price (Serenity Number): $12.70
    NCAV Price: $1.00
    Qualitative Result: Good / Enterprising
    Intrinsic Value: $12.70
    Previous Close: $84.65
    Quantitative Result: 15.00%

    Since this is an Enterprising quality stock, the Intrinsic Value of this stock equals its Enterprising Price.
    Similarly, the Intrinsic Value for a Defensive quality stock equals its Defensive Price (Graham Number), and the Intrinsic Value for an NCAV quality stock equals its NCAV Price.

    Please note that not all stocks failing Graham's rules are necessarily bad investments. Graham's rules are just extremely selective. Graham designed and backtested his framework for over 50 years, to deliver the best possible long-term results.

    http://seekingalpha.co... shows how one can assess 5000+ NYSE and NASDAQ stocks by a similar exact Benjamin Graham assessment, with no adjustments other than those for inflation.
    Feb 3, 2015. 04:50 PM | 3 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
  • Intel Shares Overvalued By 15% Due To Disappointing Dividend And Earnings Growth Outlook [View article]
    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, their results irrefutable, and his students consistently exceptional. It's 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, given below are the actual 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%

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

    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 20, 2014. 01:17 PM | 3 Likes Like |Link to Comment
  • Recent Buy: National Oilwell Varco, Inc. [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.

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

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

    For example, given below are all Graham ratings for National Oilwell Varco Inc (NOV).

    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%.

    National Oilwell Varco Inc - Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 4,574.00%
    Current Assets ÷ [2 x Current Liabilities]: 122.96%
    Net Current Assets ÷ Long Term Debt: 309.46%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 25.00%
    Earnings Growth (100% ⇒ 30% Growth): 357.43%
    Graham Number ÷ Previous Close: 112.07%

    Not many people today know that 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".

    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 20, 2014. 01:12 PM | 3 Likes Like |Link to Comment
  • Altria Group Inc: Prepare For The Fall [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.

    Warren Buffett once wrote an article explaining how Graham's principles are everlasting, their results irrefutable, and his students consistently exceptional. It's called "The Superinvestors of Graham-and-Doddsville".

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

    Given below are the actual Graham ratings for Altria Group Inc (MO).

    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%.

    Altria Group Inc - Defensive Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 3,532.00%
    Current Assets ÷ [2 x Current Liabilities]: 46.68%
    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): 29.36%
    Graham Number ÷ Previous Close: 19.38%

    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".

    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 19, 2014. 09:49 AM | 3 Likes Like |Link to Comment
  • Coach Inc. Is A Great Opportunity For Value Investors [View article]
    Warren Buffett once wrote an article explaining how Benjamin Graham's principles are everlasting, their results irrefutable, and his students consistently exceptional. It's 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. 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 criteria ($500 million today if adjusted for inflation). 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 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 - Benjamin 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: 73.14%

    The Final Graham Assessment for Coach Inc is also given below.
    The Quantitative Result (Intrinsic Value ÷ Previous Close) for a stock has to be 100% for true Graham investment.

    Coach Inc - Final Graham Assessment
    Defensive Price (Graham Number): $25.23
    Enterprising Price (Serenity Number): $16.94
    NCAV Price: $3.36
    Qualitative Result: Good / Enterprising
    Intrinsic Value: $16.94
    Previous Close: $34.49
    Quantitative Result: 49.12%

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

    http://seekingalpha.co... shows how to do a true 17-point Benjamin Graham assessment for 5000+ NYSE and NASDAQ stocks; with no modifications other than adjustments for inflation.
    Oct 21, 2014. 05:50 PM | 3 Likes Like |Link to Comment
  • Benjamin Graham Would Like Qualcomm Inc. Today [View article]
    Warren Buffett once wrote an article explaining how Benjamin Graham's principles are everlasting, their results irrefutable, and his followers consistently exceptional. It's 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.
    Even when Graham's recommended methods are used, they are heavily modified - often beyond recognition - to fit 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 ensuring adequate size of a company for Defensive investment ($500 million today, when adjusted for inflation). Checking for market capitalization instead of sales will - all other things being equal - rate overvalued stocks higher than undervalued ones.

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

    Given below are the actual Graham ratings for Qualcomm Inc (QCOM).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - CA/2CL : 75%, NCA/LTD : 90%, EPS Stability: 50%, Div Record: 5% and GN/PC: 137%.

    Qualcomm Inc - Defensive Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 4,974.00%
    Current Assets ÷ [2 x Current Liabilities]: 187.56%
    Net Current Assets ÷ Long Term Debt: 100.00%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 55.00%
    Earnings Growth (100% ⇒ 30% Growth): 201.07%
    Graham Number ÷ Previous Close: 57.61%

    The Final Graham Assessment for Qualcomm Inc is also given below.
    The Quantitative Result (Graham Price ÷ Previous Close) for a stock has to be 100% for true Graham investment.

    Qualcomm Inc - Final Graham Assessment
    Defensive Price (Graham Number): $40.73
    Enterprising Price (Serenity Number): $30.21
    NCAV Price: $6.01
    Qualitative Result: Good / Enterprising
    Graham Price: $30.21
    Previous Close: $70.71
    Quantitative Result: 42.72%

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

    He also spent nearly 50 years developing and backtesting the 17 rules in his investment framework; a framework that has been repeatedly endorsed by some of the world's most successful investors.

    http://seekingalpha.co... shows how to do an exact 17-point Benjamin Graham assessment for 5000+ NYSE and NASDAQ stocks; with no modifications other than adjustments for inflation.
    Oct 14, 2014. 04:35 PM | 3 Likes Like |Link to Comment
  • 5 Companies For Defensive Investors With Low PE Ratios [View article]
    Intrinsic Value = EPS x (8.5 + 2xGrowth)

    Benjamin Graham actually warned against this formula and only used it to show why such oversimplified growth estimates are unreliable. This formula is popular only due to a printing omission in recent editions of The Intelligent Investor.

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

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

    For example, given below are the actual Graham ratings for Bed Bath & Beyond Inc (NASDAQ:BBBY).

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - CA/2CL : 75%, NCA/LTD : 90%, EPS Stability: 50%, Div Record: 5% and GN/PC: 137%.

    Bed Bath & Beyond Inc - Defensive Graham Ratings
    Sales | Size (100% ⇒ $500 Million): 2,300.00%
    Current Assets ÷ [2 x Current Liabilities]: 103.66%
    Net Current Assets ÷ Long Term Debt: 100.00%
    Earnings Stability (100% ⇒ 10 Years): 100.00%
    Dividend Record (100% ⇒ 20 Years): 0.00%
    Earnings Growth (100% ⇒ 30% Growth): 182.25%
    Graham Number ÷ Previous Close: 69.02%

    The Final Graham Assessment for Bed Bath & Beyond Inc is also given below.
    The Quantitative Result (Graham Price ÷ Previous Close) for a stock has to be 100% for true Graham investment.

    Bed Bath & Beyond Inc - Final Graham Assessment
    Defensive Price (Graham Number): $44.35
    Enterprising Price (Serenity Number): $31.09
    NCAV Price: $6.82
    Qualitative Result: OK / NCAV
    Graham Price: $6.82
    Previous Close: $64.26
    Quantitative Result: 10.61%

    Warren Buffett once wrote an article explaining how Benjamin Graham's principles are everlasting, their results unquestionable, and his followers exceptionally successful. It's called the 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 actual methods are used, they are often modified to fit the stocks rather than having stocks meet them.

    Article 2: http://seekingalpha.co... shows how to apply Graham's actual 17 stock selection criteria to 5000 NYSE & NASDAQ stocks today.
    Aug 30, 2014. 10:01 AM | 3 Likes Like |Link to Comment
  • Ben Graham's Explanation For The Dividend Champions' Premium Valuation [View article]
    Good article! But as some of the other readers pointed out, Benjamin Graham also specified requirements for Earnings growth and gave Margin of Safety calculations for the multiples an investor should stay within.

    In all, Graham recommended three different categories of stocks - Defensive, Enterprising and NCAV - with 17 different qualitative and quantitative criteria for finding them.

    For example, given below are the actual Graham ratings for Hershey and Sherwin-Williams.

    Defensive Graham investment requires all the ratings to be at least 100%.
    Enterprising Graham investment requires the ratings to be at least - CA/CL : 75%, CA/LTD : 90%, EPS Stability: 50%, Div Record: 5% and GN/Price: 137%.

    The Hershey Company (NYSE:HSY) - Defensive Graham Ratings
    Sales | Size: 1,430.00%
    Current Assets ÷ Current Liabilities: 88.33%
    Current Assets ÷ Long Term Debt: 60.12%
    Earnings Stability: 100.00%
    Dividend Record: 100.00%
    Earnings Growth: 111.05%
    Graham Number ÷ Current Price: 19.44%

    The Sherwin-Williams Company (NYSE:SHW) - Defensive Graham Ratings
    Sales | Size: 2,038.00%
    Current Assets ÷ Current Liabilities: 62.46%
    Current Assets ÷ Long Term Debt: 56.14%
    Earnings Stability: 100.00%
    Dividend Record: 100.00%
    Earnings Growth: 133.04%
    Graham Number ÷ Current Price: 10.46%

    http://seekingalpha.co... discusses Graham's actual 17 stock selection criteria and shows how to apply them to 5000 NYSE & NASDAQ stocks today.
    Aug 9, 2014. 10:34 PM | 3 Likes Like |Link to Comment
  • How To Invest In A Deep Value Investment Opportunity In 3 Easy Steps: Load Caza Oil & Gas, Sit, And Wait [View article]
    It seems to be quite common to refer to Value Investing and Benjamin Graham in an analysis these days, without actually using any of the principles or criteria that Graham actually recommended.

    Benjamin Graham recommended three different grades of stocks for investment - Defensive, Enterprising and NCAV - and sixteen criteria for finding them.

    http://seekingalpha.co... lists all sixteen of the criteria Graham recommended in The Intelligent Investor, and gives step-by-step instructions on how to find stocks that meet them.

    http://seekingalpha.co... describes the kind of oversimplified analysis commonly attributed to Graham, and how Graham specifically warned against such shortcuts.
    May 15, 2014. 04:21 PM | 3 Likes Like |Link to Comment
  • Invest In Stocks With A Margin Of Safety To Reduce Risk And Enhance Returns [View article]
    Hello Chuck,

    That's a great point you make about understanding the reasoning behind the Graham's principles before implementing them.
    But is it really a good idea to ignore Graham's methods while trying to follow his principles?

    Graham wrote his books in the period between 1934 to 1973.
    By then:

    1. IBM and Xerox had been already speculators' favorites for decades (by 1973).
    2. NYSE had been around for 150 years (from 1817 or earlier).
    3. Stock Markets had been around for 350 years (starting with the Amsterdam Stock Exchange in 1602).

    So Graham already had centuries of Stock Market history to teach with.
    Technology and International Trade were ubiquitous, intangibles were common in balance sheets, and Graham referred to them all in his books quite often.

    Graham even taught that companies could have more earnings with fewer assets. That's why Graham's most common intrinsic value calculation - the Graham Number - is a function of (Book Value x Earnings); so that a higher value in one compensates for a lower value in the other.

    Warren Buffett describes himself as 85% Graham and 15% Phil Fisher, and refers to Graham's book - The Intelligent Investor - as "by far the best book about investing ever written".

    Wouldn't it be a good idea to get Buffett's 85% right first - and use Graham's methods when they are so clearly written down - before worrying about how to do the remaining 15%?
    Sep 18, 2013. 08:08 AM | 3 Likes Like |Link to Comment
  • Would Benjamin Graham Like HollyFrontier? [View article]
    HollyFrontier Corp (HFC) has been paying uninterrupted dividends for dividends for the last 20 years (from 1994 to 2013).

    Serenity's automated screeners also currently list Weis Markets Inc (WMK) and Helmerich & Payne Inc (HP) as stocks that clear all the above Defensive criteria specified by Graham.
    May 31, 2013. 07:20 AM | 3 Likes Like |Link to Comment
  • Why Benjamin Graham Investors Can Ignore What 'Research' Says [View article]
    Benjamin Graham actually taught that the returns an investor could expect were not proportional to the risk he was willing to assume, but rather, to the effort he was willing to put into his investments.

    Quoted from "General Portfolio Policy: The Defensive Investor" of The Intelligent Investor:

    "It has been an old and sound principle that those who cannot afford to take risks should be content with a relatively low return on their invested funds. From this there has developed the general notion that the rate of return which the investor should aim for is more or less proportionate to the degree of risk he is ready to run. Our view is different. The rate of return sought should be dependent, rather, on the amount of intelligent effort the investor is willing and able to bring to bear on his task. The minimum return goes to our passive investor, who wants both safety and freedom from concern. The maximum return would be realized by the alert and enterprising investor who exercises maximum intelligence and skill."

    And from Warren Buffett's Preface to The Intelligent Investor:

    "Whether you achieve outstanding results will depend on the effort and intellect you apply to your investments, as well as on the amplitudes of stock-market folly that prevail during your investing career"

    More details on Graham strategies on http://seekingalpha.co...
    Apr 12, 2013. 09:16 AM | 3 Likes Like |Link to Comment
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