This is a mobile optimized page that loads fast, if you want to load the real page, click this text.

Students of Roger Montgomery's (Buffett's) intrinsic valuation method

Jump to new
zac said:
Which raises a good question as I get confused.
When calculating debt from the balance sheet. What are we looking for?
Total Liabilities, Long Term debt, or is there something else?
Click to expand...

Only interest bearing debt.

Liabilities like provisions, payables etc can be left out imo.
 

Correct. All things being equal. Leverage increases ROE and makes a company more valuable.

But all things are rarely equal. Companies in different industries have different levels of debt that are deemed appropriate. Companies in the same industries have different operating efficiencies and margins so their ROE / ROC are different on those grounds.
 
RM mentioned CCV positively on his blog today , I guess tomorrow we will see the price go up again on what will possibly be another negative day.
 
Bobcol said:
RM mentioned CCV positively on his blog today , I guess tomorrow we will see the price go up again on what will possibly be another negative day.
Click to expand...

He has been spruiking CCV for a long time. I remember when it was about 58c he was very positive on it but I was already fully loaded up.

It is more tempting now given that there are not so many decent looking opportunities around.
 
On the program your money your call this week. Roger hinted that he was accumulating shares in a gold producer.
He didn't want to say what the company was as this may effect the price he is paying.
I remember that the same type of comment was made before he spoke at length about MCE

Anyone got an idea on what the gold stock maybe?
 

haha, just wondering...did you sign up just to find this out?

I have a strong inclination that the company would be RMS. It ticks alot of the boxes from a Value Investing perspective...has a new mine opening soon...low cost producer...good ROE, virtually no debt...and its small cap...
Expect RMS to hit $2 when he mentions it...

he spruiks these stocks after he buys them...knowing the effect it will have..

He virtually has a license to print money...
 
Thanks for that.

No I haven't just signed up. Mainly just read what others have to say. I just noticed that nothing was said about his appearance on YMYC and the hint he dropped

Will have some reading to do.


Hold AUT HOG FGE
 
VSntchr said:
I have a strong inclination that the company would be RMS.
Click to expand...

No it's not RMS. I thought it would be too but Roger said it isn't. I've been looking at RMS for a bit now. I have an idea but I'm not at liberty to say until I buy some too!
 
Could it be MML? understand MML is a rather large company, but has a rediculous margin on its production (cost less than $200 per ounce while gold price is currently $1,480 per ounce).

Note MML is a favourite of mine which I think is undervalued and I currently hold. But it has zero debt, growth prospects and significant cash flows. Just my 2c.
 
Yeah MML does look good for a gold stock. Another interesting one that appears very undervalued is GDO..

Im not too sure if my valuations are spot on for these companies but GDO definitely shows value...
 
VSntchr said:
Yeah MML does look good for a gold stock. Another interesting one that appears very undervalued is GDO..

Im not too sure if my valuations are spot on for these companies but GDO definitely shows value...
Click to expand...

VS, just ran some quick numbers with a combination of consensus estimates, recent quarterly activities and quarterly costs.

Looks like they could be well on track for EPS of around the 8-9 cents mark and with minimal debt (EDIT: Looks like they do have some debt actually, explains why they didn't show in my personal screener, this could alter the valuation a bit, still looks promising though). This would value them at least in the $1.00+ mark by my simple calculations at the moment (still at work).

Could potentially be a good find . Interested in the views of others and note I haven't looked at their history or potential in depth, just ran some quick numbers. Certainly on the very brief face of it though has some potential to have an intrinsic value well above today's prices.
 

Im at work at the moment but ill get back to you this evening with a more detailed view of my thoughts...i too still have a lot more research to do so it will be good to work as a team
 
Hmm, yes, GDO does look undervalued.

At the current forecast EPS, the ROE will be around 60%(ish) for the next year. I have a forecast IV of $2.20 for the next FY.

That's a massive discount to IV at the current price.

For the current year, the IV is about $0.14 (ROE was 17% and I have a RR of 15%).

Of course, all of this is based on the FORECAST EPS of 8.9c from commsec with its consensus of one analyst (hardly a "consensus"). Therefore, I take the above future IV with a huge grain of salt. Thoughts on the future NPAT anyone?
 
Just a suggestion.

It would probably be better if you take discussions & valuations of particular stocks to the relevant stock thread as you may get more feedback from followers of that stock who don't follow this thread and also this thread won't get cluttered and important info missed on both new value stocks posted here and info on the stocks you are all researching.

Thanks
 

I get what you get. For some reason I just dont feel secure with the resource sector.
 
nomore4's, we are a little off track however the stocks were looking at are in relation to Roger Montgomery's style and valuation method.

drlog, agree with you a little as a lot of what i've been reading lately is pointing towards a China slowdown either way. It could be a gradual slowdown starting now with mild pain, or it could be a real shock to the system in possibly 2-4 years time.

This would really hurt our resource sector, even if India does pick up some of the slack. However that may mean that gold retains its time in the spotlight and remains at record levels, so value companies like GDO or MML could still be making these exceptional margins.

Any idea when we will find out what Roger's gold pick is?
 
Hi all

In regards to companies and value, E trade have a stock valuation tool GDO indicates last price 0.50 stock value is $1.12.

Anyone have an opinion of how accurate this is with this tool. Does it seem accurate based on your own way of evaluation of a company

last price...0.50
book value per share $0.11
discount rate 10.75%
dividend $0
first year forecast EPS 0.089
second year forecast EPS 0.086
long term EPS growth 30%
long term industry average return on equity 10.1%
Stock Valuation 1.124

Cheers
SG
 
I've got a suspicion the gold stock is CAH. Have heard several sources say it's undervalued but yet to value it myself. It's a cheap producer, about to start producing significantly more and lots of room to increase reserves. The Speculator and Fat Prophets like it and are buying. Any thoughts?
 
A quick question in relation to Value.Able graduates. I notice RM comments about V.A graduates from 2010 and 2011 etc.
Is there an actual course, if so how does one get on it, or are the graduates simply people that have read the book?
 
Hey Zac,

There isn't a course, I'm pretty sure it relates to generally when people have read the book/contributed to the blog.
 
You must log in or register to reply here.

Similar threads

L
Intrinsic Value
Replies
4
Views
1K
qldfrog
Buffett's 5 second intrinsic value calculation
5 6 7
Replies
139
Views
58K
TPI
B
Long duration Investing
2
Replies
20
Views
10K
Value Collector
Menu
Log in
Register
Cookies are required to use this site. You must accept them to continue using the site. Learn more...