In recent days, I have been immersing myself in the annual reports and other filings of a company called Brown-Forman. The company, which manufactures Jack Daniel’s whiskey, Chambord vodka, Korbel Champagnes, and other brands of spirits, is still controlled by the family that has owned it for more than a century, with two classes of stock trading on the New York Stock Exchange.
After writing about the 20 year performance of Colgate-Palmolive stock, my Aunt Donna asked me about Dawn dish soap, which is owned by Procter & Gamble. I broke out the historical dividend charts and went to work to create a comparison of how an investor would have fared had they parked money in P&G twenty…
I’m still running several weeks behind but one of the things I’ve been working on is a response to a few of the questions submitted by FratMan, whom you’ve seen in some of the mail bag sections I believe. He’s mentioned a few times, such as in the comments sections here and here, that he likes…
A Look At How the Father of Value Investing Calculated the Intrinsic Value of an Ordinary Share of Common Stock Benjamin Graham, the rich investor, professor, and mentor to Warren Buffett, once proposed a quick back-of-the-envelope intrinsic value formula for investors to determine if their stocks were at least somewhat rationally priced. He encouraged investors…
Using Wal-Mart Stores as an Example of Earnings Yields vs. Treasury Bond Yields I was up until 5 a.m. this morning reading through the past few years’ of Wal-Mart Stores, Inc. annual reports, filings with the SEC, analyst reports, transcripts, and other documents. It is about time to have the businesses make another contribution to…
In 1960, Miller Gorrie was around 25 years old. Throughout his life, he had taken his earnings from paper routes and poured them into IBM stock, which had compounded at 20%+ for many years. This led to the young man possessing a portfolio worth more than $100,000, which adjusted for inflation, is more than $728,000…
The current valuation of Tiffany & Co. seems absurd to me. I do not understand why people are paying it. Let me walk you through the numbers.
I’m re-reading “Damn Right! Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger” by Janet Lowe and came across a passage that illustrates exactly the sort of thing I’m talking about when I harp on acquiring assets that constantly churn out piles of cash for you spend, redeploy into new investments, give to charity, or…
The experience of Johnson & Johnson owners over the past decade is informative in understanding the role valuation and growth plays in determining total return outcome. Let’s take a closer look.
I started thinking about people who lose everything, or what Charlie Munger calls returning “to Go”, as in the Monopoly board. Once you are rich, your primary motivation shouldn’t be to get richer, it should be to avoid wipeout risk, or returning to go. But as a training exercise, I decided to contemplate what I would do if I woke up tomorrow and the last ten years had been a dream. What would my first course of action be to rebuild until I got my financial affairs in order?
