Joel Greenblatt

Joel Greenblatt

Last Update: 05-15-2015

Number of Stocks: 893
Number of New Stocks: 200

Total Value: $13,110 Mil
Q/Q Turnover: 32%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

Joel Greenblatt Watch

  • 5-year lows: Realogy Holdings Corp, International Game Technology, Valley National Bancorp, and Mack-Cali Realty Corp

    According to GuruFocus list of 5-year lows, these Guru stocks have reached their 5-year lows: Realogy Holdings Corp, International Game Technology, Valley National Bancorp, and Mack-Cali Realty Corp


    Realogy Holdings Corp (NYSE:RLGY) Reached the 5-year Low of $36.95

      


  • PetSmart Is a Top Defensive Company with Growth

    As the bull market continues, I am becoming more defensive. In the "Intelligent Investor," Benjamin Graham said, “The defensive investor must confine himself to the shares of important companies with a long record of profitable operations and in strong financial condition.” I used GuruFocus’ All-In-One Guru Screener to find a defensive stock in order to add a more defensive position.


    Defensive Screen:

      


  • Caesars Isn’t Giving Up, but Is It Enough to Turn Profits Around?

    In the last article I wrote about Caesars Entertainment Corp (NASDAQ:CZR), I pointed out that the company’s profits haves declined significantly, due to several factors like the licensing proliferation in the U.S. and the 2009 recession, which resulted in strong revenue declines throughout 2012. Furthermore, I was bearish about the casino’s ability to regain its financial strength, given its lack of free cash flow and immense debt load. With investment gurus like Paul Tudor Jones (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio) selling out or reducing their shares in the company, it seems as though not much has changed in the past months. But let’s take a look at the Apollo Global Management LLC (NYSE:APO) controlled casino operator and see if there might be an upside anytime soon.


    Is a New Acquisition Really a Good Idea?

      


  • Urban’s Expansion Plans Look Attractive

    Urban Outfitters Inc. (NASDAQ:URBN) is a leading lifestyle specialty retail company that operates Urban Outfitters, Anthropologie, Free People, Terrain and BHLDN brands. The company operates in two segments: retail and wholesale apparel. The company’s retail segment consists of its Urban Outfitters, Anthropologie, Free People, Terrain and BHLDN brands, whose merchandise is sold to customers through its stores, websites, mobile applications, catalogs and customer contract centers.


    In this article, let's take a look at this company and try to explain to investors the reasons this is an apparently appealing investment opportunity.

      


  • Weekly Three-Year Low Highlights: CRTO, CVT, QSII, CNSI

    According to GuruFocus list of three-year lows; CRITEO, Cvent Inc., Quality Systems Inc. and Comverse Inc. have all reached their three-year lows.


    CRITEO (NASDAQ:CRTO) Reached the Three-Year Low of $28.94

      


  • Johnson Controls Is a Nice Bet at this Moment

    In this article, let's take a look at one company in the Auto Parts & Equipment sub-industry and try to explain to investors the reasons this is an apparently appealing investment opportunity.


    Johnson Controls Inc. (NYSE:JCI) supplies building controls and energy management systems, automotive seating, and batteries. It operates in three primary businesses: Building Efficiency, Automotive Experience and Power Solutions. The Building Efficiency segment provides facility systems, services and workplace solutions including comfort, energy and security management for the residential and non-residential buildings markets. The Automotive Experience segment designs and manufactures interior systems and products for passenger cars and light trucks, including vans, pick-up trucks and sport/crossover utility vehicles. The Power Solutions segment designs and manufactures automotive batteries for the replacement and original equipment markets.

      


  • 5-Year Lows: American Eagle Outfitters, Intrexon Corp, Mack-Cali Realty Corp, and Weight Watchers International Inc

    According to GuruFocus list of 5-year lows, these Guru stocks have reached their 5-year lows: American Eagle Outfitters, Intrexon Corp, Mack-Cali Realty Corp, and Weight Watchers International Inc


    American Eagle Outfitters (NYSE:AEO) Reached the 5-year Low of $10.99

      


  • Technological Innovation Will Ensure a Profitable Future for This Auto Parts Supplier

    With safety regulations getting stricter for automotive manufacturers, auto-parts suppliers which manufacture safety automotive systems and components are avid to gain profit from this context. This is the case of multibillion dollar auto-parts manufacturer TRW Automotive Holdings Corp (NYSE:TRW). The company focuses on designing, and manufacturing active and passive safety automotive products for OEMs and the aftermarket. Furthermore, TRW has four business segments: the Chassis Systems segment, the Occupant Safety Systems segment, the Automotive Components segment, and the Electronics segment. Each of this operating businesses are respectively responsible for 66%,19%,11% and 4% of sales.


    The Chassis segment focuses on manufacturing products related to brake and steering modules, as well as on linkage and suspension. In addition, the Occupant Safety Systems segment manufactures airbags, seatbelts and restrain systems. As for the Automotive Components segment, it produces body controls and some engine components as valves. Finally, the Electronic segment focuses on the design of electronic components for safety systems, chassis, powertrain and driver assistance. With a 2013 revenue of $17.4 billion, let me show you why this company is a great investment opportunity.

      


  • The Many Reasons Why This Canadian Wireless King Will Remain on Top

    Founded in 1920, Rogers Communications Inc. (RCI) has grown to become the largest communications and media company in Canada. The firm provides wireless voice and data communications services, telephony, cable TV, Internet access and video retailing. It also has a business solutions division, which offers data networking, voice communications services and broadband Internet connectivity to businesses.


    A Leadership Trajectory

      


  • Weekly Guru Bargains Highlights: VOD

    According to GuruFocus updates, these stocks have declined the most since Gurus have bought.



    Vodafone Group PLC (NAS:VOD): Down 48% Since Steven Romick (Trades, Portfolio) Bought In the Quarter Ended on 2013-12-31

      


  • Big Solutions to Improve Dow's Balance Sheet

    The Dow Chemical Company (NYSE:DOW) is the largest U.S. chemical maker by sales. It is engaged in manufacturing and supplying products used primarily as raw materials in the manufacture of customer products and services. The company serves the following industries: appliance; automotive; agricultural; building and construction; chemical processing; electronics; furniture; housewares; oil and gas; packaging; paints, coatings and adhesives; personal care; pharmaceutical; processed foods; pulp and paper; textile and carpet; utilities; and water treatment.


    In this article, let's take a look at this company and try to explain to investors the reasons this is an apparently appealing investment.

      


  • Why I Feel Bullish on Akamai

    Akamai Technologies Inc. (NASDAQ:AKAM) is engaged in providing content delivery and cloud infrastructure services for accelerating and improving the delivery of content and applications over the Internet.


    In this article, let's take a look at this company and try to explain to investors the reasons this is an apparently appealing investment.

      


  • Can GameStop Adapt to New Challenges?

    GameStop Corp. (NYSE:GME) is a video game retailer. The company sells video game hardware and software, accessories, as well as personal computer (PC) entertainment software and other merchandise.


    So let's take a look at this company and try to explain to investors the reasons this is an apparently appealing investment in the videogame industry which is highly competitive and shoppers have many alternatives to buy.

      


  • Is Cooper Companies' Upward Trend Likely to Go On?

    A Delaware corporation organized in 1980, Cooper Companies Inc. (COOP) is a global medical devices company dedicated to being A Quality of Life Company (TM) with a focus on delivering shareholder value. It operates through two business units: CooperVision, Inc (CV) and CooperSurgical, Inc (CS). They compete on the basis of product quality and differentiation, technological benefit, service and reliability. CS focuses on developing and manufacturing diagnostic and surgical products for gynecologists and obstetricians. Its customers are healthcare professionals and institutions providing care to and for women. On the other hand, CV is engaged in the development, manufacturing and marketing of monthly, two-week and single-use contact lenses, including advanced materials and optics. It is one of the world's top four developers and manufacturers of contact lenses. Approximately, 58 percent of CV's sales are international. CS' sales account for 15 percent of total sales.


    In the last month, Cooper Companies has been enjoying rising earnings estimates, riding on strong fiscal 2014 first-quarter results and a promising guidance for fiscal 2014. The global medical device company has delivered positive earnings surprises in 3 of the last 4 quarters. It also reported an improvement of 200 basis points -each in the gross and operating margins for the quarter. Moreover, in the past 30 days it saw five upward estimate revisions for fiscal 2014 with no downward revision over the same time frame. Shares rose up by 7.2 percent in the last month and while this trend may have just begun, is it likely to keep going on? Let's take a closer look at the company and find out.

      


  • The World's Third-Largest Oilfield Services Provider Favoring from Key Actions

    Baker Hughes Incorporated (NYSE:BHI) is a supplier of oilfield services, products, technology and systems to the oil and natural gas industry. The company provides products and services for drilling and evaluation of oil and natural gas wells; completion and production of oil and natural gas wells; and other businesses, including downstream refining, and process and pipeline services.


    Strong Portfolio

      


  • The Rise of an Underdog Cable Network

    In order to survive in the television entertainment industry, a company must be large and diversified. While this supposition is true to some extent, it doesn’t apply to all success stories in the media industry. AMC Networks Inc. (NASDAQ:AMCX), post its spin-off from Cablevision Systems Corporation (NYSE:CVC) in 2006, was shy of major profits at the start, but in a little over five years has managed to become one of the most tantalizing investment options in the TV market. In fact, investment gurus Steven Cohen (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio) have been buying large amounts of the company’s shares this past quarter, hoping to gain decent profits in the long term.


    Slowly, but Steadily Gaining Terrain

      


  • Gurus and Methanol Say No to Methanex

    For quite some time now, global warming has become a common lexicon. The fear of an unsustainable world due to pollution and radical weather has fueled the search for alternative fuels. The incentive drove individual and corporate efforts to develop and propose some interesting solutions. Biodiesel, bioalcohol, fuel cells, hydrogen, vegetable oil, among other fuels are considered substitutes for fossil fuels. Nonetheless, neither alternative has developed sufficient acceptance or the necessary infrastructure to serve the world market. In the USA, the latest alternative to be proposed has been methanol from natural gas. Should the proposal garner enough support at Washington DC, it would be a game changer, especially for Methanex (NASDAQ:MEOH). So far, lawmakers have not been too moved by the idea, and analysts argue that intense lobbying will be a key to reverse their opinion.


    Gurus’ Dumping and Operational Difficulties

      


  • GameStop Corp: A Company Needing to Adapt in a Changing Industry

    GameStop Corp. (NYSE:GME) is a U.S. video game and entertainment software retailer. Based in Grapevine, Texas, the company operates 6,700 stores throughout America and Europe. It is the main retailer and often the only choice for gamers of new and used games. Offering a wide variety of used titles, having good customer service, accepting most titles, and also giving the customers credit on new games for their used ones, the pre-owned games (used games) business has generated as much as half of the company’s gross profit.


    Having a customer loyalty program (PowerUp Rewards), with more than 30 million users, the company ensured both its new and preowned gaming market, giving benefit to customers (usually young ones that use solely cash), and ensuring its market share against competitors such as Target or Wal-Mart. Though now the online retail store Amazon.com seems to be the most dangerous competition for GameStop.

      


  • An Intro to Magic Formula Investing

    Over the coming years I will be covering Joel Greenblatt (Trades, Portfolio)’s “magic formula” and the stocks that come up on the magic formula screen. Since its inception in 2006 I have been fascinated that such a simple formula can truly make value investing a whole lot easier.


    Since it has been a couple of years since "The Little Book That Beats the Market" has been released, chances are that “newer” value investors might not be familiar with it. So let’s start with the basics and what I hope to accomplish.

      


  • Joel Greenblatt - Large Caps Have a Much Better Valuation These Days Than Small Caps

    On the long side Greenblatt likes Hewlett-Packard (NYSE:HPQ) and Apple (AAPL) both of which have huge returns on capital and very low valuations.


    He doesn't like buying a tech company on its own, but he loves buying a basket of these companies with these kinds of metrics.

      


  • This Tech Company Endured the 90s Bubble and Managed to Stay on Top of the Market

    Before, After and Throughout the 90s Bubble

      


  • Weekly CEO Buys Highlight: CLMS, OPK, OVAS, RTRX, MDCA

    According to GuruFocus Insider Data, these are the largest CEO buys during the past week. The overall trend of CEOs is illustrated in the chart below:


    Calamos Asset Management Inc. (NASDAQ:CLMS): Chairman, CEO and Global Co-CIO, 10% Owner John P. Calamos Sr. Bought 225,004 Shares

      


  • This Auto Parts Bull Is Expected to Continue Outperforming

    The auto parts industry is starting to regain momentum and suppliers are making hefty profits from an improving economic situation. Or at least this seems to be the case for industry giant Magna International Inc. (NYSE:MGA).


    Magna is an amply diversified company that is divided in three business segments: the External Production Sales segment, the Complete Vehicle Assembly operating Group, and Tooling, Engineering and Other. The biggest operating group is the External Production Sales segment, and is spread in various geographic regions. The U.S. market makes up approximately 50% of the company's income, while the European market is responsible for 30% of the income.

      


  • Ritchie Bros Auctioneers’ Debt Levels a Few Years After the Crisis

    I like to keep a close eye on the developments of the auctioneer industry. Sometimes, I come across interesting investment options, like Ritchie Bros. Auctioneers Inc. (NYSE:RBA). Although I take many aspects into account when I analyze a company, I will focus, in this article, on debt and liabilities, in addition to examining what analysts and other top investors think about this company.



    This analysis is crucial to understanding the risks of investing, and will allow us to appreciate how leveraged the auctioneer is, and what kind of returns to expect from a long-term investment after the company reported its earnings last Monday. As the years 2008 and 2009 have taught us, leveraged companies with large amounts of debt can have a devastating impact over your investment. However, by taking a close look into the debt scheme of Auctioneers, we will be able to elucidate if the company is likely to maintain its capital, and use it for future growth.
      


  • Gotham Asset Management’s Big Bets on Tech

    Over the past days hedge funds have been filing their form 13-F, which is a quarterly report of equity holdings for institutional investment managers with at least $100 million in equity assets under management, as required by the United States Securities and Exchange Commission (SEC). In this article, let's concentrate in one particular hedge fund and try to see the principal holdings in its portfolio. I will look into Gotham Asset Management LP in which Joel Greenblatt (Trades, Portfolio) and Robert Goldstein serve as Managing Principals and co-CIOs for Gotham, with over 50 years of combined investment experience.


    Recently the fund reported its equity portfolio, as at the end of last year. The total value of the portfolio amounted to $4.2 billion, up from $3 billion disclosed at the end of the previous quarter. Consequently, the fund's total return was 40% in the last quarter. The filing revealed that at the end of last year, the fund added 219 new positions to its equity portfolio, and sold out of 150 other companies. The top ten portfolio holdings as of the end of the quarter represented 6.3%. The largest changes from previous 13-Fs fillings are in the technology sector (1.6%) followed by industrials and telecom (around 1% each).

      


  • Magna International: A Look at This Diverse Auto Part Supplier’s Profitability

    As one of the largest and most diversified auto parts supplier worldwide, Magna International Inc. (NYSE:MGA) provides auto repair shops with an extremely vast array of products, including seating, roof systems, powertrain, electric vehicle systems, vehicle assembly and engineering, amongst others.


    Although this sort of diversification has earned the company some profitable years, many analysts consider it to be unsustainable in the long term, as management is forced to spread its resources throughout multiple product development groups. Also, the prior bankruptcy cases of fellow competitors Delphi Automotive PLC (NYSE:DLPH) and Visteon Corp (NYSE:VC), which had a similarly diverse business model, should be a warning regarding this firm’s balance sheet.

      


  • Wendy's Short-Term Good Trend

    The Wendy's Company (NASDAQ:WEN) is one of the largest fast food restaurants operating with more than 6,000 locations worldwide. The company focuses on quality and therefore higher prices must be charged, but Wendy's has seen a growth decline because customers have less disposal income and are switching to other less expensive products. To improve this situation the company launched initiatives like the “Right Price, Right Size Menu initiative”, which offers items ranging from 99 cents to $1.99 trying to win back low-price-shopping consumers. The firm's competitors include Burger King Worldwide, Inc. (NYSE:BKW), McDonald´s Corp. (NYSE:MCD) and Yum! Brands Inc. (NYSE:YUM).


    Now, turning our attention to the future direction of the stock, let's take a look at the intrinsic value of this company and try to explain to investors the reasons why it is a good buy or not. In this article, we present a model that is by no means the be-all and end-all for valuation. The purpose is to force investors to evaluate different assumptions about growth and future prospects.

      


  • Five-Year Lows: Northwest Natural Gas, Diamond Offshore Drilling Inc., Quality Systems Inc. and National Bank Holdings Corp

    According to GuruFocus list of 5-year lows, these Guru stocks have reached their five-year lows: Northwest Natural Gas, Diamond Offshore Drilling Inc., Quality Systems Inc. and National Bank Holdings Corp.


    Northwest Natural Gas (NYSE:NWN) Reached the Five-Year Low of $42.03

      


  • Calculating United Tech's Fair Value Based on Future Growth Expectations

    United Technologies Corp. (NYSE:UTX) is a diversified business conglomerate serving various end-markets such as aerospace, defense and commercial construction. It has reported strong earnings per share improvement in fourth quarter 2013 compared to the same quarter a year ago. Additionally, the company has demonstrated a pattern of positive earnings per share growth over the past two years, as we can see in the next chart. We include the stock price because EPS often lead the stock price movement.


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  • An Industry Giant Re-Adapting to a New Scenario

    The pharmaceutical industry is a dynamic market, where the need for investment in new developments and generic competition, mark the path for major manufacturers. Pfizer Inc. (NYSE:PFE) is a firm with an outstanding portion of prescription drug’s sales (reaching up to 90%), and a large share of the pharmaceutical market, making it an industry leader. Pfizer enjoys a wide moat, based on its capacity to diversify fields of operation, secure high levels of cash flow and financial strength for the development of new drugs, and finally due to its sales ratio in emerging markets.


    New Opportunities, New Challenges

      


  • New Management and a Profitable Outlook for This Auto Parts Giant

    Stocks that are profitable in the first-quarter fiscal 2014, which also have encouraging projections for the entire fiscal 2014, have been drawing the attention of investors. This is the case of Johnson Controls (NYSE:JCI), a diversified enterprise with a promising outlook.


    Even though JCI has to deal with big competitors such as Lennox International Inc. (NYSE:LII) or Siemens AG (SI), the company successfully conducts three operating groups. These are: the building efficiency segment, the automotive segment, and the power solutions segment. Each segment is a multi-billion operating business, that respectively showed revenue growth throughout fiscal 2013.

      


  • DirecTV: Risks Remain, but Profits Are Growing

    Fighting for customer a solid customer base is one of the largest challenges among any pay TV provider in the industry. However, for satellite TV operators like DirecTV (NASDAQ:DTV) this trial is even more difficult, given consumers' rapidly changing viewing habits. Furthermore, the company’s expansion strategy into the emerging Latin American market is supposed to be a source of growth, but some issues regarding subscriber declines in Brazil and a 70% overall decline in the region's subscriptions could be detrimental for profits this upcoming 2015.


    Nevertheless, the company’s 93,000 new domestic customers added in fourth quarter fiscal 2013 has helped improve overall results, boosting revenue by 7.7%, and allowing for margin expansion despite continued programming cost pressure. On another positive note, the TV provider has been generous with shareholders, returning $4 billion via share repurchases. However, in spite of the advanced technology and strong brand presence of DirecTV, long-term profits remain uncertain, amid headwinds in the Latin American market, currency fluctuations and changing consumer habits.

      


  • Is This Baker Ready to Play?

    It has come to be a fact that the restaurant industry has no self-evident recipe for success. Panera Bread Company (PNRA) is one of the big boys in the fast bakery-coffee category, owning and franchising stores under Panera Bread, Saint Luis Bread Co., and Paradise Bakery brands. Working the suburban strip malls and regional malls all across the US, Panera Bread operated 1,736 bakery-cafes by the last quarter of 2013. Panera’s main products include baked goods, custom roasted coffees, sandwiches, soups and salads, as well as fresh dough and sweet goods which it supplies through a contract manufacturing arrangement to both owned and franchised cafes.


    Competition and Brands

      


  • An Auto Parts Supplier With a Great Outlook

    The auto parts sector is known for its competitiveness and cyclical behavior, which can affect the long-term economic sustainability of a stock. With big competitors in this industry such as TRW Automotives Holdings Corp (NYSE:TRW) and Allison Transmission Holding Inc (NYSE:ALSN), BorgWarner Inc (NYSE:BWA) is leading the way in terms of innovation according to the new ecologic trend of the automotive industry.


    BWA is an auto-parts supplier that operates in two segments: manufacturing engine supplies that reduce emissions, and DCT (dual-clutch technology) transmissions. The engine segment is accountable for 70% of the company’s sales, and is thus largely responsible for the firm’s total revenue rising up to $7 billion. This company is focused on improving fuel efficiency and reducing emissions for its customer’s products. Thus, making long-term economic profitability in an increasingly ecologically concerned industry is what is expected for this company.

      


  • Guru Stocks at 52-Week Lows: CHL, VOD, T, KO, HMC

    According to GuruFocus list of 52-week lows, these Guru stocks have reached their 52-week lows.



    China Mobile Ltd. (NYSE:CHL) Reached the 52-Week Low of $47.87

      


  • Weekly 3-Year Low Highlights: VOD, TFM, SALT, WPRT, PBPB

    According to GuruFocus list of 3-year lows; Vodafone Group PLC, Fresh Market Inc, Scorpio Bulkers Inc, Westport Innovations Inc, and Potbelly Corporation have all reached their 3-year lows.


    Vodafone Group PLC (NASDAQ:VOD) Reached the 3-year Low of $39.00

      


  • The Stocks Investor Joel Greenblatt Wants

    Deviser of stock market investing tactics for the everyman, Joel Greenblatt (Trades, Portfolio) disclosed this week what he bought for his own portfolio in the fourth quarter. The guru owns 950 stocks in total, of which 220 are new as of the quarter. It is valued at $4.2 billion and most heavily weighted among the industrials (24.2%), technology (20.1%) and consumer cyclical (19.7%) sectors.

    He has relatively high turnover in his portfolio at 39% over the previous quarter due in part to his investing style. The “Magic Formula,” the famous strategy he created for consistently market-beating returns, involves: screening for top-ranked stocks, buying them and holding them for one year.  


  • Amgen Inc: As Good as It Gets?

    A biotechnological pioneer since 1980, Amgen Inc. (NASDAQ:AMGN) is now the world's largest independent biotechnology company. It is committed to unlocking the potential of biology for patients suffering from serious illnesses in the areas of supportive cancer care, nephorology and inflammation. Its approach begins with using tools such as advanced human genetics to unravel the complexities of disease and understand the fundamentals of human biology. In its discovering, developing, manufacturing and delivering innovative human therapeutics in different parts of the world, Amgen focuses on areas of high unmet medical need and leverages its biologics manufacturing expertise to find solutions that improve health outcomes and exponentially improve patients' lives. Last quarter Amgen presented a solid earnings report. It reached revenues 13.3% higher than last year's quarter, with products like Neulasta, Epogen, Enbrel, Prolia and Xgeva driving growth. Is this as good as it gets for Amgen, or does it still have some room for growth?


    It's All About the Pipeline

      


  • Why Procter & Gamble Is a Buy: A Look at Fundamental Value

    In a previous article we saw the 13F´s holdings of Absolute Return Investors. Here, let´s analyze if one of them, Procter & Gamble Co (NYSE:PG) is coherent to be in that long portfolio. The company does not need too much introduction. It has five segments: Beauty, Grooming, Health Care, Fabric Care and Home Care, and Baby Care and Family Care. The firm's largest competitors include Johnson & Johnson (JNJ) and Kimberly-Clark Corporation (KMB).


    Turning our attention to the future direction of the stock, let's take a look at the intrinsic value of this company and try to explain to investors the reasons why it is a good buy or not.

      


  • Weekly CEO Buys Highlight: HOLX, EPB, CLMS, IDTI, BYI

    According to GuruFocus Insider Data, these are the largest CEO buys during the past week. The overall trend of CEOs is illustrated in the chart below:


      


  • Thoughts on Return on Capital and Greenblatt’s Magic Formula Part 2

    In part 1 of this post, I mentioned I caught a video interview with Joel Greenblatt at Morningstar. In the video, Greenblatt talks about indexing, and things that are not necessarily interesting to me and my investment strategy, but he also had some brief comments on return on capital. In the last post, I discussed the basic method that Joel Greenblatt (Trades, Portfolio) uses to define return on capital. I also discuss some of the fundamentals and the importance of this key business metric, so check out that post first, if you haven’t yet.


    The interesting thing was when Greenblatt specifically said he looks to fill his portfolio with businesses that have historically produced 50% returns on capital.

      


  • 5-Year Lows: Schnitzer Steel Industries Inc., Walter Energy Inc., Silver Bay Realty Trust Corp and Resolute Energy Corp

    According to GuruFocus list of five-year lows, these Guru stocks have reached their five-year lows: Schnitzer Steel Industries Inc., Walter Energy Inc., Silver Bay Realty Trust Corp. and Resolute Energy Corp.


    Schnitzer Steel Industries Inc. (NASDAQ:SCHN) Reached the Five-Year Low of $25.23

      


  • Apparel Retailer Pushed Down by Teen Fickle Trends and Pricing Pressure

    Aeropostale Inc. (NYSE:ARO) is a mall-based specialty retailer of casual apparel and accessories for customers between the ages of 14 and 17. The company designs, markets and sells good-quality fashion and basic fasion products at relatively low prices under its namesake brand and P.S. from Aeropostale. Its products compete with those of other teen retailers such as Abercrombie&Fitch (NYSE:ANF), American Eagle Outfitters (NYSE:AEO), Hollister Co. (operated by ANF) and Old Navy, a brand owned by Gap Inc. (NYSE:GPS). Aeropostale designs and sources all of its products, thus maintaining control of its proprietary brands. The firm owns 984 Aeropostale stores located in all 50 states, Puerto Rico and Canada, as well as 100 P.S. for Aeropostale locations.


    Lack of Moat and Narrow Margins

      


  • Valuation of Wal-Mart 's Common Stock Using Dividend Discount Model (DDM)

    Wal-Mart Stores Inc. (NYSE:WMT) is the largest retailer in North America. It operates retail stores in various formats worldwide, a chain of over 10,000 discount department stores, wholesale clubs, supermarkets and supercenters. The company operates in three segments: Walmart U.S. (59.0% of the company´s sales in fiscal 2013), Wal-Mart International (29%) and Sam's Club (12%).


    Valuation

      


  • Thoughts on Return on Capital and Greenblatt's Magic Formula Part 1

    I recently watched a video of Joel Greenblatt with Morningstar. Most of the video discusses the index approach to investing using a value weight (as opposed to equal weight or market weight, which most indexes use).


    I’m not that interested in indexing, although for individuals that want completely passive exposure to stocks, value weighting certainly makes much more sense to me than market weighting (because market weighting systematically buys more of a stock as it goes up, thus forcing you to buy more of a stock as it becomes more overvalued, and less of a stock as it becomes undervalued… equal weighting makes these errors random, and value weighting essentially reverses the errors, thus allowing you to own more of a stock as it becomes cheaper, and less of it as it becomes more expensive).

      


  • Will This Time-Share Exchange Business Reap Profits or Losses?

    It’s difficult for any company to last several decades in the leisure industry, especially after an economic crisis or a recession arises. However, a few market giants with a diversified brand portfolio and strong international presence have managed to ride the tidal wave successfully and are now looking towards a brighter future. Interval Leisure Group Inc. (NASDAQ:IILG) is one of these market giants. A pioneer and innovator in the vacation ownership market since 1976, the Miami-based firm operates the second-largest time-share exchange business in the world, Interval International. Today, this company’s exchange network comprises over 2,800 resorts in 75 countries, and its quality products are offered to approximately 2 million members. So, let’s see why investment gurus Joel Greenblatt (Trades, Portfolio), John Keeley (Trades, Portfolio) and Ron Baron (Trades, Portfolio) are all so keen on buying this company’s shares.


    New Acquisitions

      


  • A Tweaked Magic Formula Screen That Looks Very Promising

    I’ve recently decided to go back and re-read a few classics on performing valuations and what value-based systematic strategies have  worked over the years.  One of the most impressive findings in the financial literature of the past 10 years is the now-famous book by Joel Greenblatt (Trades, Portfolio): "The Little Book That Beats the Market."


    This is based on the simple realization that ranking companies based on specific measures of return on capital and earnings yield and choosing the best ranked ones to construct a portfolio would have outperformed the S&P over any three-year period since the mid-1960s.

      


  • The Market Magic of a Toy Company

    In the fast-paced modern-day world, traditional toy manufacturers must face a fierce battle against the electronics and video-game industry. Mattel Inc. (NASDAQ:MAT) is the largest toy company in the leisure industry, and as such must face these challenges. However, this company’s combination of a solid product portfolio, international expansion and cost efficiency programs make it a strong contender for long-term investments. Let’s see what encouraged investment gurus John Hussman (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio) to buy this company’s shares.


    Toys for Boys and Girls

      


  • A Personal Care Giant That Knows Where It’s Going

    ​In the personal care industry, product innovation, international presence and consumer loyalty are key factors for any company willing to sustain its market position. The Colgate-Palmolive Company (NYSE:CL) is a firm that has united all of these aspects for the past 200 years and has grown to be one the world’s largest consumer product companies. Its product portfolio comprises a combination of toothpastes, detergents, shampoos, shower gels, deodorants and shaving products, which are sold in 225 countries. In addition to these traditional products, the firm also owns specialty pet food maker Hill’s, which sells its products via veterinarians and pet retailers. So, let’s see why investment gurus Joel Greenblatt (Trades, Portfolio) and Mario Gabelli (Trades, Portfolio) are so keen on owing shares in this company.


    A Necessary Quality Product

      


  • Another Great Tobacco Buy

    A few days ago I wrote an article recommending British American Tobacco (BTI) because of its outstanding dividend, its presence in emerging markets such as Brazil and its determination to boost its below industry average margins. Now, I will take a look at a company which (1) Its more concentrated in the ailing European Market but (2) Is the most obvious M&A candidate within the big tobacco companies. Let's take a look at Imperial Tobacco (ITYBY) and try to make a compelling investment case for this big tobacco company.


    On Valuation, performance and cash dividends

      


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