With the closing of multiple investment banks’ equity research departments and headcount reductions throughout the industry, there remains little doubt that the world of equity research is changing rapidly. Whether these changes simply represent an industry-wide restructuring or whether we are witnessing a major global disruption remains to be seen. However, what is becoming clear […]

While technical skill and depth of research are highly important for an equity analyst, many good analysts fail to live up to their potential because they don’t present their work in the best light. James Valentine, author of “Best Practices for Equity Analysts” illustrates the importance of communication using the chart below. As an analyst […]

While we encourage our analysts to rely first and foremost on some form of intrinsic valuation, we recognize that multiple analysis plays an important role in supporting and sense-checking conclusions. This guide is intended to help analysts navigate the pros and cons of using such multiples. The use of multiples has a bad reputation in […]

Equity Analysts at Nomura in London were left in shock this week as Nomura announced the restructuring of the equity research department. In a statement Nomura said:  “since the second half of last year, global markets have experienced extreme volatility and a significant decline in liquidity” When you look at the facts however, there is […]

“confronted with a challenge to distill the secret of sound investing into three words, we venture the motto, Margin of Safety” Benjamin Graham, The Intelligent Investor  Of all the concepts that a value investor holds dear, intrinsic value and the “margin of safety” are the most sacred. These ideas form the bedrock of what Benjamin […]

  “If earnings have been unwisely retained, it is likely that managers, too, have been unwisely retained” Warren Buffett When a company pays a dividend, they are paying you, the owner, with cash that you already own. In theory this transaction shouldn’t create any value. But in practice companies that pay a high and stable […]

I recently finished reading “The Second Machine Age”, which was recommended to me by one of our board advisors.   The authors Eric Brynjolfsson and Andrew McAfee make a convincing argument that we are in the midst of a paradigm shift every bit as transformative as the industrial revolution. While the industrial revolution was about harnessing […]