How do you find undervalued companies? What criteria or formulas do you use in your search when buying?


Graham used the NCAV formula to find undervalued companies, ones that have significantly more current assets vs total liabilities so if it was liquidated now the value would be greater then the share price. I think he shot for 60% NCAV for wiggle room.

Do you strictly use NCAV when searching for companies? What other formulas, ratios or other data do you look for when buying? What screams buy me and what stinks of bankruptcy? Is there certain key ratios you wont buy a company without? How do you value a company personally?

*Sidenote: I believe we are in a much different time then Graham where everything is fake, money is fake, the market is fake and everything is heavily financialized and we have central banks directly manipulating markets which adds uncertainty.


Comments

Leave a Reply

Your email address will not be published. Required fields are marked *