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|Subject: Re: Selecting stocks the Ben Graham way||Date: 12/9/2004 9:53 AM|
|Author: RaplhCramden||Number: 34785 of 46911|
I agree that there are significant accounting rule problems associated with book value. That's why an adjusted book value should be used, but that's not so dissimilar to the problems with reported earnings, is it.
You and SNS might enjoy, if you haven't already, the book "Value Investing from Graham to Buffett and Beyond" http://www.amazon.com/exec/obidos/tg/detail/-/0471381985/102-9609822-5688922?v=glance
They go through numerous scenarios in which you start with book and make adjustments to come up with about 3 different estimates of the value of a company.
Book explicitly DOES NOT include Intellectual Property, which is almost certainly the most important asset of most of the modern high growth companies. But this is my bugaboo, not the books, they talk about lots of different adjustments.
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