GuruFocus publishes three monthly newsletters. These newsletters are the included features for Premium Members.
1. Ben Graham: Net-Net Newsletter focuses on net-net stocks that Ben Graham would buy. It is released on the first Friday of each month.
2. Micro-Cap Magic Formula Newsletter picks companies that have high return on capital and high earnings yield. It is released on the second Friday of each month.
3. Buffett-Munger Best Bargains Newsletter recommends companies that have high business quality, but traded at undervalued prices. A younger Buffett would buy this kind of companies. It is published on the third Friday of each month.
The authors for Ben Graham: Net-Net Newsletter and Micro-Cap Magic Formula Newsletter put their own money into the newsletter picks in real portfolios on the Mondays after the newsletters are released. Subscribers have the full weekends to digest the pick and they will have the same opportunities to buy these stocks on Mondays.
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.
This month's pick has been growing at rates normally reserved for tech startups like Facebook and Twitter: revenues have almost tripled over the past five years.
Despite that, the company is trading for a decidedly un-Facebook like multiple of under 6.5x EV / EBIT and less than 10x earnings.
We're not the only ones to take notice of this discrepancy between growth and multiple: two noted activist value investors have taken large stakes in the company, noting the company trades for a substantial discount to intrinsic value and that shareholders would best be served by a sale to help the market realize just how valuable the company is.
If the activists are successful, then the newsletter could realize well over 100% gains in a very short time horizon.
If they're not, we should still do pretty well- a company can only grow at 25%+ per year for so long before the market takes notice and assigns an appropriate multiple to it!
We will buy this week’s Magic Formula Newsletter pick on Monday, May 14.
Download this month’s Microcap Magic Formula Newsletter.
Also don’t miss:
May Ben Graham Net-Net Newsletter: A Ben Graham Net-Net with 19 Straight Years of Profits.
All the monthly newsletters are included in GuruFocus Premium Membership. If you are not a Premium Member, we invite you for a 7-day Free Trial.
1. Ben Graham: Net-Net Newsletter focuses on net-net stocks that Ben Graham would buy. It is released on the first Friday of each month.
2. Micro-Cap Magic Formula Newsletter picks companies that have high return on capital and high earnings yield. It is released on the second Friday of each month.
3. Buffett-Munger Best Bargains Newsletter recommends companies that have high business quality, but traded at undervalued prices. A younger Buffett would buy this kind of companies. It is published on the third Friday of each month.
The authors for Ben Graham: Net-Net Newsletter and Micro-Cap Magic Formula Newsletter put their own money into the newsletter picks in real portfolios on the Mondays after the newsletters are released. Subscribers have the full weekends to digest the pick and they will have the same opportunities to buy these stocks on Mondays.
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.
This month's pick has been growing at rates normally reserved for tech startups like Facebook and Twitter: revenues have almost tripled over the past five years.
Despite that, the company is trading for a decidedly un-Facebook like multiple of under 6.5x EV / EBIT and less than 10x earnings.
We're not the only ones to take notice of this discrepancy between growth and multiple: two noted activist value investors have taken large stakes in the company, noting the company trades for a substantial discount to intrinsic value and that shareholders would best be served by a sale to help the market realize just how valuable the company is.
If the activists are successful, then the newsletter could realize well over 100% gains in a very short time horizon.
If they're not, we should still do pretty well- a company can only grow at 25%+ per year for so long before the market takes notice and assigns an appropriate multiple to it!
We will buy this week’s Magic Formula Newsletter pick on Monday, May 14.
Download this month’s Microcap Magic Formula Newsletter.
Also don’t miss:
May Ben Graham Net-Net Newsletter: A Ben Graham Net-Net with 19 Straight Years of Profits.
All the monthly newsletters are included in GuruFocus Premium Membership. If you are not a Premium Member, we invite you for a 7-day Free Trial.
