though from a macro standpoint things look grim, the good news is that since we have some excess cash we are able to buy securities at somewhat peculiar prices -- thus the spectacle of Shimano's shares trading at 8x cash-adjusted earnings after having fallen by half in three months, 3M's at 9x earnings, Pargesa's at close to our first purchase price 6 years ago, and Nitto Kohki's shares at 2x cash-adjusted earnings. As investors with a long-term perspective, equities are beginning to look attractive, even as corporate profits come under pressure.
We are focusing on the types of companies we always have--a combination of “cigar butts” (as Warren Buffett called Benjamin Graham-type stocks) and some truly exceptional businesses trading at fire sale prices. Sometimes when investing seems most scary it's the best time to invest. This may be one of those times.
- Jean-Marie Eveillard, Matt McLennan and Abhay Deshpande
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