As value investors with a long-term horizon, we are happy to patiently wait for undervalued securities to appreciate toward our estimates of intrinsic value. Occasionally, we are pleased to see the value gap close more rapidly, which is what has happened with Forest Labs over the past three quarters. Forest Labs appointed a new CEO, who quickly introduced a substantial cost-cutting program and a more shareholder-friendly capital allocation strategy. These measures helped Forest Labs enjoy a 60% increase in stock price since January 2013.
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From Bill Nygren (Trades, Portfolio)'s fourth quarter 2013 commentary.
