Nov
24
“Bargains like this should NEVER exist in an efficient market—especially for such a high return on capital business. The only reason this was possible was because the markets are occasionally very inefficient. Look for situations where today’s earnings are masked by growth expenditures. Look for situations with heavy marketing spending. Think about ‘core profitability’ and what a business is really worth. In the end, small companies get acquired by big businesses hungry for growth. Think like one of those big businesses. CNS, Inc. went up six times from where I bought it. Those are outstanding opportunities if you can find them.”
AdventuresinCapitalism | Hidden Value (Advertising Expense)
