Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (12) | Ignore Thread Prev | Next
Author: hamishrose One star, 50 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 5655  
Subject: Re: What 's In The Furture? Date: 6/18/2002 6:17 AM
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Recommendations: 3
Great conversation guys.

I think that to class as Boring, a company needs either to not have the speculative element or to have that risk suitably discounted in the price. There is quite a distinction between those points and the board might want to discuss how we feel about risk. We should be prepared to pay a price premium for Walmart over Target because it does have less risk. Thinking about it now, I don't think that a Boring port should accept much risk at all. None of this stops us from looking at companies and assigning a price to them. The more risk we beleive they hold, or the less confident we are about our understanding, the more margin of safety we should require.

It's not unreasonable to expect a company to have declining earnings in a bad economy and that doesn't affect its intrinsic value - it should be factored into the price regardless. What matters though is managements approach. Are they candid? Are they cutting costs? Are they cutting costs to inflate short term earnings at the cost of long term earnings? How have they performed in the past? A Boring company should have been around long enough that we can look at how they cope with downturns. Since downturns don't affect the intrinsic price of a good company they can provide buying oppurtunities.

Hamish Rose
Post New | Post Reply | Reply Later | Create Poll Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (12) | Ignore Thread Prev | Next

Announcements

Foolanthropy 2014!
By working with young, first-time moms, Nurse-Family Partnership is able to truly change lives – for generations to come.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Macro Economics

Looking at Currency Ratios
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement