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Over 50% of the discussion during a typical earnings call with management is focused on short-term demand trends that will have little to no impact on the long-term value of the business. This is not helpful to long-term shareholders. “How did the business trend intra-quarter?” “Was the first month of the new quarter better than the last month?” “Are you seeing any green shoots in demand?” And so on. Thus “investors” spend about an hour of the CEO’s and CFO’s time four times a year. Except they aren’t really investors, are they? #investing #valueinvesting #management https://lnkd.in/e98W4GXg

We played around with Greenblatt's 'Magic Formula' in search of the names best positioned to outperform over the next few months. Back in 2005, Joel Greenblatt introduced his Magic Formula for investing with 'The Little Book That Beats the Market'. The book details a methodical approach that helps investors find some of the cheapest, most well-operated companies and buy them each month for a one-year holding period. There is nothing truly “magical” about the formula (or our variations of it), and the use of the formula does not guarantee performance or investment success. But it can help us find new ideas. Here's what we found:

🌟 Unlocking the Secrets of Stock Analysis: Beyond the PE Ratio 🌟 Hello, LinkedIn family! Ever felt like you're only seeing the surface of the stock market's iceberg? Let's dive deeper together. Imagine you're a detective, and each financial ratio is a clue leading you to the true story of a company's value. 🕵️♂️💼 The Tale of Numbers and Narratives Once upon a time, in the land of investment, there was a widely known spell called the PE Ratio. But the wise knew that the magic didn't end there. They looked further, uncovering secrets like: Earnings per Share (EPS): The bread crumbs of profit leading back to the company's performance.Reflects how much profit a company makes per share of stock. Return on Equity (ROE): It indicates how effectively a company uses shareholders' funds to generate profits. A higher ROE often points to a more efficient business. Debt-to-Capital Ratio: A scale balancing risk and reward, telling tales of a company's debt dragon. Interest Coverage Ratio (ICR): A shield's strength, showing how well a company can fend off its interest obligations. Enterprise Value to EBIT (EV/EBIT): A treasure map comparing the company's kingdom (including its debt) to its earnings Operating Margin: The potion of profitability, revealing how much the company earns from its core spells (operations). Quick Ratio: A crystal ball foreseeing if the company can survive short-term curses with its liquid assets. In this story, every ratio whispers different secrets about the company's past, present, and future. The Invitation to a Financial Adventure I invite you to join me on this quest for knowledge. Let's turn each page of the company's financial story with curiosity and learn from each other. 🔍 Your Quest Awaits: Do you want me to unravel the mysteries of each ratio in detail? Are you ready to become a financial detective with me? Let's decode the clues and uncover the wealth of knowledge hidden in the numbers! #FinancialLiteracy #InvestmentInsights #StockMarketAnalysis #FinancialRatios #InvestingBasics #BeyondPERatio

Part 2 - Why Should You Care? Knowing what insiders are doing can give you some pretty useful clues about the company's future. Here’s how: 1. **Management’s Confidence**: If the CEO and other top executives are buying shares, it’s a good sign they think the company is on the right track. It might make you feel more confident about investing too.    2. **Market Sentiment**: Large insider buys can boost investor confidence and potentially drive up the stock price. On the flip side, big sells might make people nervous and drive the price down. 3. **Research Tool**: Insider trading info can be part of your research toolkit. It helps you either back up or question other things you’re hearing or reading about the company. 4. **Timing and Trends**: Watching insider activity can help you spot trends. If you see insiders buying regularly, it might be a signal that good things are coming. If they’re selling a lot, it could be a warning sign. ### Example Time Let’s say you’re thinking about investing in a company, Company XYZ. You look at the recent insider trading reports and see that the CEO and CFO have been buying a lot of shares lately. This could be a sign that they’re really confident about an upcoming product launch or positive financial results. That might make you feel more comfortable putting your money into Company XYZ. On the other hand, if you see that several insiders are selling a lot of shares, you might dig a little deeper. Maybe they’re just cashing out some stock for personal reasons, which isn’t a big deal. But if they’re selling because the company is facing some challenges, you might decide to hold off on buying those shares. ### Wrap Up So, keeping an eye on insider activity can give you valuable insights. It’s like having a window into the thoughts and expectations of the people who know the company best. While it shouldn’t be the only thing you look at when deciding whether to invest, it’s definitely a helpful piece of the puzzle. Stay informed by signing up for future FREE copies of Inve$t: https://lnkd.in/gESG3zxb #Investing #StockMarket #Investwithknowledge #Investsmart

I personally see this as a good thing, not just the shrinking of the public sector, but also the trend away from IPO and public ownership of companies. From a business perspective, going public has many additional costs and regulations that need to be followed, plus the ability to pivot and take risks is disrupted by the need of the executives to worry about the shareholders. In the end, it is less control over the business. However, the rise in private equity ownership is also troubling because there is rarely a vetting process performed on the buyers by the sellers. And the decisions amplified to a select few which wield far greater levels of influence. Scaling a business can be expensive and difficult, so seeking funds and expertise is a natural result. But that decision could be far more disastrous when diligence is not exercised. https://lnkd.in/ghbP3f2U

Interesting article from Yahoo Finance about the "Magnificent Seven" and a potential shift in earnings growth. Time to re-balance, hold, or sell? As a long-term investor, I'm curious to hear other perspectives. #investing

In his latest quarterly commentary, Richard Skeppstrom discusses the equity markets’ bull run and the tech sector’s outsized influence. 🔗 to read more https://lnkd.in/eF6WG6Pu #Brockenbrough #InvestedinYourFuture #MarketCommentary 

In Part 2 of "100 to 1 in the Stock Market", a brief overview is given of what I view as the key analytical takeaways from the book. After more than 50 years, less has changed than one would think. The basic math behind investing is constant and not subject to obsolescence. https://lnkd.in/g-ATA5wf

“Do we think smaller companies have the potential to outperform larger companies going forward?” In this clip from Arnerich Massena, Inc’s fourth quarter MarketCast, Co-CEO and Chief Investment Officer Bryan Shipley, CFA, CAIA, looks at the price ratio between small and large cap stocks over the last 30 years, discussing why small caps may be attractive to investors. For more commentary and analysis of both the quarter and the year, watch the full fourth quarter MarketCast, in which he and Co-CEO Reegan Rae, CPWA® offer insights on the market landscape and potential opportunities, available at https://lnkd.in/gJCyEMAw #marketanalysis #marketcommentary