Thanks for the comment. Serenity and I both use the same formula for graham number: sqrt(22.5*EPS*BVS) so the coming from the inputs for earnings per share and book value per share. I'm not sure where you saw Serenity's calculations, I'm assuming here:

http://bit.ly/Y9nmin

http://bit.ly/13COyhy

It looks like Serenity gets their data from Yahoo! Finance while I source mine from Guru Focus. The differences don't appear to be drastic though - Serenity had Graham numbers of 39.24 and 52.57 for ALG and BHI respectively, while I had values of 39.53 and 51.00.

Does that help answer your question?

Best Regards,

-Clinton ]]>

Thanks for the comment. Serenity and I both use the same formula for graham number: sqrt(22.5*EPS*BVS) so the coming from the inputs for earnings per share and book value per share. I'm not sure where you saw Serenity's calculations, I'm assuming here:

http://bit.ly/Y9nmin

http://bit.ly/13COyhy

It looks like Serenity gets their data from Yahoo! Finance while I source mine from Guru Focus. The differences don't appear to be drastic though - Serenity had Graham numbers of 39.24 and 52.57 for ALG and BHI respectively, while I had values of 39.53 and 51.00.

Does that help answer your question?

Best Regards,

-Clinton ]]>

My apologies if this question has already been asked, but isn't at least part of the reason energy prices skyrocketed in the 70's/80's due to limited supply and the issues with OPEC. I'm wondering if energy is really the right play since in 2013 it looks like more natural gas and energy alternatives will be brought to market to meet demand due to technology advances. Any thoughts?

Thanks for a good read!

-Clinton]]>

My apologies if this question has already been asked, but isn't at least part of the reason energy prices skyrocketed in the 70's/80's due to limited supply and the issues with OPEC. I'm wondering if energy is really the right play since in 2013 it looks like more natural gas and energy alternatives will be brought to market to meet demand due to technology advances. Any thoughts?

Thanks for a good read!

-Clinton]]>

Best Regards,

-Clinton]]>

Best Regards,

-Clinton]]>

I agree with the point I think your trying to make, which is that the rate of compounding is more important than entry price over a long period of time. The point I'm trying to make is different. I'm trying to show the the opportunity cost of paying too much for a company. Let me take your example to emphasize.

Company A's shares sell for 2 dollar today. The next year two years, the company spends heavy to set up the future and report lower than expected net income - by the end of the two years, share price has dropped to 1. From year 2 on it grows 30% for thirty years.

Investor 1 bought 1 share at $2 today. Investor 2 put 2 dollars into a 5% bond, then buys 2.205 shares in two years. Which is the higher return at the end of 30 years?

Investor 1 = 1*1.30^30 *1 = 2619

Investor 2 = 1*1.30^30 * 2.205 = 5777

Best Regards,

-Clinton]]>

I agree with the point I think your trying to make, which is that the rate of compounding is more important than entry price over a long period of time. The point I'm trying to make is different. I'm trying to show the the opportunity cost of paying too much for a company. Let me take your example to emphasize.

Company A's shares sell for 2 dollar today. The next year two years, the company spends heavy to set up the future and report lower than expected net income - by the end of the two years, share price has dropped to 1. From year 2 on it grows 30% for thirty years.

Investor 1 bought 1 share at $2 today. Investor 2 put 2 dollars into a 5% bond, then buys 2.205 shares in two years. Which is the higher return at the end of 30 years?

Investor 1 = 1*1.30^30 *1 = 2619

Investor 2 = 1*1.30^30 * 2.205 = 5777

Best Regards,

-Clinton]]>

http://seekingalpha.co...

Keep up the excellent work,

-Clinton]]>

http://seekingalpha.co...

Keep up the excellent work,

-Clinton]]>

My quick math, assuming 9 periods, 10% growth, and PV of $475 has the future value of the share at $1120.03. If the investor could have bought ~1.47 shares, the initial investment would equal $700, and the FV would have been $1,650. Not too shabby

Best Regards,

-Clinton]]>

My quick math, assuming 9 periods, 10% growth, and PV of $475 has the future value of the share at $1120.03. If the investor could have bought ~1.47 shares, the initial investment would equal $700, and the FV would have been $1,650. Not too shabby

Best Regards,

-Clinton]]>

I like the idea of when to sell article. Look for one in the coming weeks :)

Until then, happy investing!

-Clinton]]>

I like the idea of when to sell article. Look for one in the coming weeks :)

Until then, happy investing!

-Clinton]]>

Agree with you on the CDOs. Could you say more about California taxes? I hadn't heard about this.

Thanks!

Clinton]]>

Agree with you on the CDOs. Could you say more about California taxes? I hadn't heard about this.

Thanks!

Clinton]]>

Thanks for the comments!

Clinton]]>

Thanks for the comments!

Clinton]]>

Best Regards,

Clinton]]>

Best Regards,

Clinton]]>

First, I agree completely with jclyak and Zeeshan.Maqsood. If you look my article analyzing $WFC fundamentals:

http://seekingalpha.co...

You will see that in addition to revenue increasing, both earnings per share and the dividend have been increasing at greater than 6%.

Second, a correlation of 0.44 is weak correlation at best. It is not even remotely relevant.

Lastly, this is most ridiculous statement I've ever heard, "In this regard, it means that if the EPS of the company is increasing, it is very likely that company may decrease its dividend payout or/and share prices may reduced"

Look forward to hearing your response...

-Clinton]]>

First, I agree completely with jclyak and Zeeshan.Maqsood. If you look my article analyzing $WFC fundamentals:

http://seekingalpha.co...

You will see that in addition to revenue increasing, both earnings per share and the dividend have been increasing at greater than 6%.

Second, a correlation of 0.44 is weak correlation at best. It is not even remotely relevant.

Lastly, this is most ridiculous statement I've ever heard, "In this regard, it means that if the EPS of the company is increasing, it is very likely that company may decrease its dividend payout or/and share prices may reduced"

Look forward to hearing your response...

-Clinton]]>

-Clinton]]>

-Clinton]]>

Technically you are right. They only have 19 years on consecutive dividends.

You might be interested to see how RS did today though, up 8%:

http://bit.ly/Qm2Spj]]>

Technically you are right. They only have 19 years on consecutive dividends.

You might be interested to see how RS did today though, up 8%:

http://bit.ly/Qm2Spj]]>

You might be interested in my review of Wells Fargo's fundamentals and my conservative estimate of investor return over the next decade if they were to purchase at today's price range:

http://seekingalpha.co...

Keep up the good work,

-Clinton]]>

You might be interested in my review of Wells Fargo's fundamentals and my conservative estimate of investor return over the next decade if they were to purchase at today's price range:

http://seekingalpha.co...

Keep up the good work,

-Clinton]]>

The only one that made it on my February List of Defensive Investor Stocks was $SSL:

http://bit.ly/XmG9GC

Best Regards,

-Clinton]]>

The only one that made it on my February List of Defensive Investor Stocks was $SSL:

http://bit.ly/XmG9GC

Best Regards,

-Clinton]]>

China is another country I get weary of. The Graham analysis becomes meaningless because of the liberties companies are allowed to take when drafting their financial statements.

Thanks again for the thought provoking insights!

-Clinton]]>

China is another country I get weary of. The Graham analysis becomes meaningless because of the liberties companies are allowed to take when drafting their financial statements.

Thanks again for the thought provoking insights!

-Clinton]]>

Best,

-Clinton]]>

Best,

-Clinton]]>

That is a good point. My estimate only looked at an annualized return based on the capital gain. In the future I will include dividends in my analysis. By my quick back of the napkin calculation, you would get close to $14/share of dividends over the next 10 years or roughly another 3%.

Thanks for the comment!

-Clinton ]]>

That is a good point. My estimate only looked at an annualized return based on the capital gain. In the future I will include dividends in my analysis. By my quick back of the napkin calculation, you would get close to $14/share of dividends over the next 10 years or roughly another 3%.

Thanks for the comment!

-Clinton ]]>

Glad you enjoyed the analysis and your spot on. I like to keep my articles more on the conservative side because I don't want my readers to buy on speculation. That said, I do think their is a case for WFC seeing it's P/E and NIM climb back 2006 levels of 12-15 and 4.83%.

Thanks for the input, always helps to hear another investor's perspective,

-Clinton]]>

Glad you enjoyed the analysis and your spot on. I like to keep my articles more on the conservative side because I don't want my readers to buy on speculation. That said, I do think their is a case for WFC seeing it's P/E and NIM climb back 2006 levels of 12-15 and 4.83%.

Thanks for the input, always helps to hear another investor's perspective,

-Clinton]]>

Best Regards,

-Clinton]]>

Best Regards,

-Clinton]]>