Joel Greenblatt

Joel Greenblatt

Last Update: 2014-02-14

Number of Stocks: 950
Number of New Stocks: 220

Total Value: $4,201 Mil
Q/Q Turnover: 39%

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

Joel Greenblatt Watch

  • Four Notable Top Buys of Joel Greenblatt in Second Quarter: AAPL, BBY, JOYG, VIA.B

    When he is not teaching as an adjunct professor at Columbia Business School, Joel Greenblatt runs Gotham Capital and writes best-selling books. Greenblatt is best known for crafting the Magic Formula Investing strategy used to help the average investor achieve success in the stock market. In his own hedge fund, Greenblatt uses the basic principals in the Magic Formula: Look for high ROC and high earnings yield. He tries to figure out what "normalized earnings" will be 3-4 years into the future. Greenblatt makes sure the stock is very cheap based on normalized earnings. Four of Greenblatt’s Top New Buys for the second quarter are: Apple (AAPL), Best Buy (BBY), Joy Global (JOYG) and Viacom (VIA.B).

    Apple (AAPL)  

  • New Magic Formula Stocks from Joel Greenblatt (I)

    Renowned value investor Joel Greenblatt reported his portfolio as of the first quarter. He now runs three magic formula mutual funds, and these are the picks based on his magic formula. As of 06/30/2011, Gotham Capital owns 574 stocks with a total value of $715 million.

    These are the details of the new positions that Joel Greenblatt added to his portfolio.  

  • Interview Stephen Penman — Columbia Business School Accounting Prof, Author of "Accounting for Value"

    Stephen Penman is the George O. May Professor of Accounting at the Columbia Business School. He is the author of “Financial Statement Analysis and Security Valuation“, for which he received a Wildman Medal Award. He also recently authored a book titled "Accounting for Value." The book’s novel approach shows that valuation and accounting are much the same: Valuation is actually a matter of accounting for value. Stephen is also an editor of the Review of Accounting Studies.

    Can you tell us a little bit about your background?  

  • Joel Greenblatt on "The Big Secret for the Small Investor" and Investing

    Steve Forbes interviewed Joel Greenblatt about his latest book “The Big Secret For The Small Investor” in which Greenblatt refines the ideas presented in a previous book called “The Little Book That Beats The Market.” These are the notes from that interview.

    About the book.  

  • Joel Greenblatt on "The Big Secret for the Small Investor" and Investing

  • Lengthy Joel Greenblatt Interview Transcript

    Steve Forbes sat down with Joel Greenblatt for an extended interview as follows:

    Forbes: We had you on a little over a year ago, but since then you’ve come out with a new book called "The Big Secret." This follows another book that you had. Why two books for investor advice? Couldn’t you get it all in the first book, which was called "The Little Book That Beats the Market?"  

  • What Is in the GuruFocus Premium Membership?

    Over the years since we started in 2004, we have created many screens for our users to locate the best value investing ideas. With this article we would like to summarize these ideas.

    We have added three monthly newsletters to the GuruFocus Premium Membership over the past three years. The newsletters are:  

  • Joel Greenblatt Article: Anyone—Even The Little Guy—Can Beat the Market

    From Registered Rep:

    As most financial advisors know, the secret to successful investing is relatively simple: Figure out the value of something and then — pay a lot less. Unfortunately, as it turns out, it's really hard to figure out the value of a business. And finding good fund managers that can do the job for you — that can be just as difficult. There are several inherent reasons why this is so. Mutual fund managers have to do the things that private investors, such as me, can afford to do. We can own just a few stocks — say as few as 10 to 25 of our favorites — and we can choose stocks that are too small for big funds to buy and for Wall Street firms to follow. Also funds often get too big and charge too much to beat the market. Complicating things further, retail investors — even their financial advisors — are unwilling to hold a good manager when his style is, well, out of style. Of course, a big impediment to beating the market that all managers must overcome is fees. Most actively managed mutual funds charge fees and expenses based on the size of the fund, usually 1 percent to 2 percent of the total assets under management. This means that the more assets a fund has, the more money the management company makes. As you might suspect, this incentive to gather more assets isn't necessarily good for investors.  

  • How “Magic” is the Magic Formula?

    The underlying concept of the magic formula is a genius marketing platform, but it is unclear how “magic” the formula actually is–examine ‘cheapness,’ examine ‘quality,’ combine the analysis and buy the best value (get the most bang for your buck). The magic formula identifies quality via EBIT / (NPPE +net working capital) and cheapness via EBIT / TEV. These two measures are certainly not ‘bad’; however, they are also not necessarily optimal.

    We are always exploring alternatives to the magic formula found in the academic literature. In fact, we highlighted the ‘academic version’ of the magic formula in the following post:  

  • Options as a Tool for the Value Investor: An Elementary Perspective (Part 1)

    Derivatives have been called “financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal” (Buffett).

    Option trading is no exception. The buyer of an option could find his investment rendered worthless in a relatively short time. By the same token, an option writer (if uncovered) finds herself in an extremely risky position and might incur very large loses, many times the premium received for shorting the underlying interest.  

  • Joel Greenblatt on Value Weighted Indexing at Ira Sohn Conference Today

    Joel Greenblatt is a managing principal and co-chief investment officer of Gotham Asset Management, LLC and the managing partner of Gotham Capital, which he founded in April 1985. Since 1996, he has been a professor on the adjunct faculty of Columbia Business School. Mr. Greenblatt serves on the Investment Boards for the University of Pennsylvania and UJA Federation, and is a director of Pzena Investment Management Inc. He is the former chairman of the board of Alliant Techsystems. Mr. Greenblatt is the author of "You Can Be a Stock Market Genius," "The Little Book That Still Beats the Market" and "The Big Secret for the Small Investor." He holds a BS and MBA from the Wharton School of the University of Pennsylvania.

    From his talk:  

  • Special – May Microcap “Magic Formula” Newsletter

    Joel Greenblatt's magic formula has proven to be one of most popular and successful quantitative screens. By finding stocks with better than average return characteristics selling for below average prices, the screen has proven its ability to outperform the market.

    However, the screen has one blind spot- stocks with a market cap under 50 million.  

  • New Magic Formula Stocks from Joel Greenblatt: DLB, LLTC, LEA, XLNX, ASNA

    Renowned value investor Joel Greenblatt reported his portfolio as of the first quarter. He now runs three magic formula mutual funds, and these are the picks based on his magic formula. As of 03/31/2011, Joe Greenblatt’s firm Gotham Capital owns 507 stocks with a total value of $333 million. These are the details of the buys and sells that have the impact to portfolio of more than 0.2%.

    This is the portfolio chart of Joel Greenblatt. You can click on the legend of the chart to show/hide buys, sells, or holdings. Each ball on the chart represents a position in the portfolio. You can move your mouse on the balls to see the details of each position and click to see the details of all guru trades with this position.  

  • Not Forgetting to Yield: CSCO , TGT , WMT , INTC

    Investors sometimes become too mechanical in their selection of stocks and do not really consider what they are actually looking at. We attempt to mechanize our process and may decide, as an example, that we want to screen our stocks to omit those with a return on equity of less than 15. While that is a great number, it also excludes stocks that have ROE’s of 14 that may actually be a better selection.

    Benjamin Graham advocated finding stocks that have an earnings yield that are at least twice the AAA bond rate. The earnings yield is an easy find and all investors should look at it; however, they should also realize exactly what they are looking at. If stock ABC has earnings for the last 12 months of .75 and is currently selling for $10.00, the earnings yield would be 7.5%. (0.75/10.00). This number is then measured against the current AAA bond rate (say 5%) to determine whether the extra 2 ½% return compensates the investor for the risk taken. In this example, we can see that the earnings yield is not twice the bond rate; therefore, we may choose to exclude it for now.  

  • The Big Secret for the Small Investor by Joel Greenblatt

    Joel Greenblatt is, without a doubt, one of the best investors of our time. Greenblatt produced annual returns of 40% for 20 years at Gotham Capital. Additionally, Greenblatt is famous for the invention of the Magic Formula Investing. Greenblatt has released a total of three books which include "You Can Be a Stock Market Genius" — which has been recommended by Seth Klarman (here), Dan Loeb (here), and David Einhorn (here) — "The Little Book That Still Beats the Market," and his latest book, "The Big Secret for the Small Investor." Proved by the fanatical popularity of the first two books, Joel Greenblatt can undeniably deliver when it comes to talking about investment.

    The investing philosophy of Greenblatt, which is encapsulated by the Magical Formula, is highlighted in "The Little Book That Still Beats the Market." The basic principle of the Magical Formula is to concentrate on stocks with high returns on capital and a high earnings yield.  

  • AVX Corporation Reports Earnings Increase of 71%

    AVX Corporation, the South Carolina-based electronic components manufacturer, reported preliminary full year results to March 31 with a 71% increase in net income to $244.0 million and 82.5% increase in diluted EPS to $1.46.

    Chief Executive Officer and President John Gilbertson said, “We are encouraged by the overall outlook for the electronic component industry as end user demand for electronic products continued to increase as evidenced by the strong bookings we received throughout the fiscal year.  

  • How does Magic Formula Investing Work?

    In Brief

    Magic Formula Investing is a value investing strategy based on buying 20-30 "good, cheap companies" defined as having the best available combined ranking in terms of earnings yield and a return on capital.


    A widely respected hedge-fund manager, Joel Greenblatt, started as a value purist but was influenced by Warren Buffett's view about growth being part of the value equation. He founded Gotham Capital, a fund which apparently returned over 40% annualized from 1985 to 2005. By 1995, it had returned all money to its outside investors. He has authored two books, "You Can Be a Stock Market Genius" and New York Times bestsellier, “The Little Book That Beats the Market,” and is also adjunct professor at Columbia University Business School. Greenblatt espouses MFI as a do-it-yourself version of the approach he has used while amassing his investment track record. With the “Little Book,” Greenblatt wanted to write a book his children could read and learn from. The main point Greenblatt makes is that investors should buy good companies at bargain prices.  

  • Special - Microcap “Magic Formula” Newsletter

    Joel Greenblatt’s “Magic Formula” has proven to be one of the most popular (and successful) mechanical value investment screens. By finding stocks with above average earnings yields and returns on invested capital, the magic formula consistently outperforms the market. However, the magic formula has one blind spot: “micro-cap” stocks, specifically those under $50 million in market cap. The Micro-Cap Magic Formula Newsletter will capitalize on that blind spot by digging through stocks too small to make the official magic formula screen.

    This is the link to download the special report:  

  • Book Review: The Big Secret for the Small Investor

    Joel Greenblatt is out with a new book: "The Big Secret for the Small Investor."

    I downloaded it onto my Kindle the second it became available – because Joel Greenblatt is our modern day Ben Graham.  

  • GuruFocus Interview with Renowned Investor Joel Greenblatt

    Joel Greenblatt is a renowned investor who invented Magic Formula Investing and founded the New York Securities Auction Corporation (NYSAC). He is the founder and Co-CIO of Gotham Capital, an investment partnership that achieved 40 percent annualized returns for the 20 years after its founding in 1985, and adjunct professor at Columbia Business School. Mr. Greenblatt has written three books on investing, including his most recent, "The Big Secret for the Small Investor."

    His investment philosophy is to find cheap and good companies, usually those in special situations. In his own hedge fund, he employs the principals of the Magic Formula: Look for high ROC and earnings yield, try to figure out what "normalized earnings" will be 3-4 years into the future, and choose only stock that is very cheap based on normalized earnings. He typically has a concentrated portfolio of only 5-8 securities at a time.  

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