Joel Greenblatt (Trades, Portfolio), founder of Gotham Asset Management, is a true value investor. He truly stands behind Warren Buffett (Trades, Portfolio)’s philosophy for buying stocks, which is to buy cheap stocks belonging to a good company. In order to figure out just how good a company is, Greenblatt looks at returns on tangible capital to fulfill his ultimate goal of finding something both cheap and good.
The value investor came up with something called Magic Formula Investing, which as a total of four rules:
- Screen for top ranked stocks
- Buy them
- Hold for one year, then sell
- Repeat Step One
Greenblatt has purchased 186 new stocks, increasing his portfolio to 970 total with a value total of $10.053 billion. Out of the most current stocks purchased within the last couple of months, some of the cheapest have been Rite Aid Corp (RAD, Financial) at $5.52 and Fairchild Semiconductor International Inc (FCS, Financial) at $15.63.
The retail drugstore chain, Rite Aid Corp (RAD, Financial), is currently up by 0.54%. Rite Aid was part of the group of failed chain pharmacy inspections in New York City. A total of 19 stores failed the inspection due to finding 540 rat droppings accompanied with a rat carcass. Some of the droppings were found on the shelves where chocolate candy bars are kept, along with bite marks, leaving 24 bags destroyed. The company issued a statement to reassure the public that additional actions will be taken to improve food safety and sanitation by requiring managers in New York City to undergo food safety and sanitation courses.
This chart shows revenue in relation to net income with analyst estimates.
Fairchild Semiconductor International Inc creates power products for different electronic applications, such as wireless phones and networking and storage equipment. The company's stock is currently up by 1.57%.
Fairchild recently announced " title="FCS"/>, Financial)+Announces+Executive+Streamlining/10022019.html" target="_blank" rel="nofollow">management changesin the leadership team. The team will now answer to Mark Thompson, the chairman and CEO. We will see how this shift in management affects the company's cash flow in the future, if at all.
This chart shows revenue in relation to net income.
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