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What are investors saying about Value.able?

What are investors saying about Value.able?

It has been four days now since the very first copies of Value.able were received.

I am very grateful for your feedback and I am impressed. I have received some requests to check valuation workings and many of the valuations I have seen so far are close enough to ‘spot on’. Congratulations everyone. It looks like the penny is dropping all over Australia as well as in Asia, Canada, the UK and the US.

Rather than continuing to check your workings individually, I thought I would post some calculations in the next few days for you to check your own workings against. A ready reckoner if you will.

There will be ten Value.able valuations for widely-held and well-known companies that you may use to cross-check against your own calculations. I will include the inputs used, so that we are comparing like with like. These valuation examples will be available by the end of the week. They are ASX Ltd, Computershare, Caltex, David Jones, Foster’s Group, Leighton, McMillan Shakespeare, Westpac, Woolworths and Wridgways.

Until then, I wanted to take this opportunity to express my sincere thanks for the overwhelmingly kind emails you have sent me and the positively entertaining comments you have written on my Facebook page.

Here are a few I would like to share and say a particular thank you for.

…Not that I’m complaining, I had planned to wash the car, and watch the rugby tomorrow night, but it looks like I will have more Value.able things to do!
Ben

I’m somewhat of a minimalist and love it when I get a book where it makes me feel like I can throw away all the other books I have on a subject – this is such a book.
Graham

Thanks for the book. It is sooooooo good to finally have a tool to find good companies.
Keith

… I am up to about Chapter 4 in your book. This is my first read and I will start over when I finish it. There is much to absorb in your book. I think its true that I have made every mistake so far detailed in the book. I have repeated some mistakes many times!!!!!
Russell

I am very impressed by your book.  I only wish I had had it in my hands ten years ago!
John

Although I have not yet finished reading your book I have been telling myself to stop speculating and to start investing. I just wish it had been in print when i first began “investing” more than twenty years ago.
Kev

I am just writing to congratulate you on this great book, especially for a newbie investor (or should I say “speculator” having read the first two chapters of the book now!). Yesterday morning when I stepped out of the house (to take my family to the Moscow Circus at Rosehill!) I noticed a package sitting on my car’s windscreen. Little did I know that it was the much-awaited book! I have read the first two chapters so far and couldn’t resist my temptation to jump directly to Chapter 11 – Intrinsic Value! I must say this is one of the foremost reasons why I was so keen on getting this book and I am not disappointed. I am talking all these fundamental/technical terms now and able to make an attempt at calculating the real value of a company…all thanks to you!
Visha

You may already have saved me many times the investment I made in your book.
Geoff

Initial impression is that your book has a particularly pleasant ‘feel’ – font, layout, texture, etc – quite incidental to the subject matter I know, but important in something you spend hours with in close association. I am also enjoying your writing style. So congratulations on both.
Jim

Your book is making my neck really, really, really sore. I’ve just come back from the doctor. He says it is from too much nodding.
Tom

Book arrived today. Where is the address for that deserted island? I need to go somewhere to read it.
young Les

Received your book and just want to say I am enjoying it very much. In fact I am thinking of purchasing another couple of copies one for my son and one for my Dad. My Dad listens in every Thursday night to your Money Your Call and always hope you are going to be on the panel. As we live in different states we then chat to each other about the show via the phone his comment is always wasn’t it great to hear Roger! Again thanks so much for a wonderful informative book which is so well written. (PS My Dad is 83, which proves we can always learn something!)
Lynne

I received your book and read it every spare moment I had. Thank you for sharing your knowledge with me.
Andrew

I just finished the book and I’m very impressed. From 7pm until now (1.58am), I couldn’t put it down. I’m amazed by how simple your calculation of IV is. I like how logical it is and therefore free from fancy arithmetic. Munger once said this: By keeping it simple & logical you have achieved [this] in spades. The margin of error therefore of a person applying it should be minimised because at least hopefully they will understand what they are doing. Very well done & a testament to you.
Matthew

I received the book yesterday and i finished it yesterday! I thoroughly enjoyed it and will recommend it to my enlightened friends! Any plans on an advanced Value.able haha?
Alex

Valueable arrived yesterday. I read until midnight and checked some valuations in my portfolio this AM. Using IV metod most of portfolio is “overpriced”. Will need to think about this for awhile. The book is well written and the example valuations you take us through are excellent. I have been a Buffet fan for a while and read Snowball etc. but you have made his valuatiuon techniques very simple to understand. Congratulations on a terrific book.
Ed

I’m almost finished reading my copy of your book which will forever change my outlook and approach to investing in the stock market. I’m so impressed with your work, I’ve just ordered another copy for my son.
Peter

I am a chartist and I can see how your book will greatly assist me and complement my charting decisions; especially during these troubled times when seeking good value stocks that are also resilient!
Brendan

I bought a book for myself. Now I have bought one for my son. I am up to chapter 6 at the moment, and it is the most value-able book in my investing collection.
Geoff

Received your book. It’s excellent – clarified so many issues that I have struggled with. Many thanks
Keith

The book arrived and we very much appreciate the gesture of your personal message. As a retired plumber my economic skills extend only to requesting pocket money from Mrs Management.  I am two chapters in and I think my frontal lobe has dropped off but as I plough on and try to absorb the message it becomes clearer that it is a book that is sorely needed by us amateurs outside the economics / equities industries, the plodders if you will.
Glenn & Mrs Management

Yesterday, I received your new book and even though I have not yet completed reading it in full, I wish to congratulate you (IMMENSELY) for your fabulous publication.
Kevin

Just finished Value.able and about to have a crack at a few valuations. The book was truly fantastic, I think in many ways it was the way I have always tried to approach buying shares but you have really managed to synthesize and lay down an excellent framework.
Ben

Great book. I have recommended it to friends and family. The examples, tables, figures etc were easy to understand. I enjoyed reading the examples using data from real businesses. I will never look at PE’s and dividends in the same way again. Thank you.
Patrick

Love the book. I have always thought that value investing made sense, but wasn’t business minded enough to know where to start.  Your book fills a large gap in teaching investors how to become investors and speculators. I’ve also realised a few home truths about my own business….. I have bought another copy for my dad David Graham so he can teach his share club a thing or two about what they are doing that he’s finding frustrating!
Paul

I recieved your book last week and haven’t been able to put it down. I’ve been a big fan of yours on the business channel since starting out in the sharemarket a couple of years ago, and I very much connect to your investment methods AWESOME :)  I have to admit i’ve been driving my wife crazy excitedly repeating everything i’m learning in your book, Haha. Thanks for all your insight and wisdom, it’s great to have a method by which i can value companies myself for our wealth creation.
Adam

I just ordered 2 more copies for my daughters… It is the best! Good luck to you and thank you for disseminating such good information in a really nice style. Well done.
Mike

I have received Value.able and have been reading it non-stop and have to say its one of the best books on investing I have read!
Ben

I’m into my second read of your book. It is sooooo gooooodddd.
Russell

Just finished Valuable – aptly named since its intrinsic value is much greaer than the price. Well done!
Kevin

Just started reading your book –clear ,precise, common sense  knowledge. Wish I had read it years ago. Have just ordered a copy for my daughter.
John

Your book is great, even I can understand most of it. I will now be an investor and not a speculator.
Rod

That little book… its supreme. Thanks, you’ve changed my world.
Tom

Your book is so simple in its explanation and your analogies are fantastic. They really drive home how easy it is to judge a company based on the value of their business not what the share price is doing.
Andrew

I wish I had read your book ten years ago – I realise with some shame that I have been just a gambler all this time – but that is in the past and I genuinely look forward to practising as a value investor.
Bradley

Reading through your book I keep finding myself nodding my head in agreement with what you have written, I think it is called positive reinforcement! It is a good read and I think will be a good reference.
Garry

I have read about 70 pages of your book so far and already have difficulty in putting the book down….very interesting and it caters for simple minded investors very well! …by combining my technical analysis system with yours, I achieve the synergy for greater confidence.
Brendan

Congratulations on publishing your book, I very much enjoyed reading it from cover to cover. I was very impressed that you delivered everything that you have promised, it is very easy to read and more importantly you have explained step by step how to actually apply all your methods in the real world. Now I will have a go at actually calculating some company valuations. Thankyou very much for sharing your knowledge,  I have been searching for a practical valuation model for a long time.
John

I’ve been reading your book, and have really enjoyed it. I think it does a great job of breaking down Buffet’s methods and making them accessible and understandable for Australian investors. I’ve actually already suggested a number of people get a copy, and I’m going to make sure that all of our brokers read it as well.
Peter

My son was excited to see a package with so many stamps he can put into his collection! I was extremely pleased to see that it was signed twice and the message. My sincere gratitude for taking the time to respond to my emails and taking the time to sign my book. It will be chrished for many years to come, particularly for the boys when they are suitably old enough to understand. I am up to chapter 11, was up to 3am this morning and have been reading it in between screaming kids etc. I am hoping for quiet 3hrs from about 10pm when everyone is in bed and the red wine absorbed in the system to take in the rest of the book.
Seb

Value.able received in good time and I have now finished my first “read through” to get a feel for it. Very much impressed by the ease of reading and now look forward to reading it on a serious basis, starting later this week.
Bill

Congratulations on the book. I am finding it very valuable in my daily work and can get the valuations down in a few minutes. When you are dealing with other people’s money you want to now what you are paying for and while our analysts do a very good job, having a “valuable” overlay just gives me that peace of mind or otherwise.
Frank

I would just like to thank you for your book. I received it in the mail late last week and have been reading it eagerly. I appreciate the depth with which you have gone into your investing approach and hope it will serve me well in my investing career (as I am sure it will many others)… Thank you gain for your amazing book.
Julian

Your blog was most helpful and I am madly using your method to value companies that I am interested in. Unless I am wrong I am finding less companies worth buying? In the past I would have bought them and therefore speculated. So thanks again for your great book and look forward to hearing more from you.
Gina

Thank you very much for your book. It is one of the most helpful books I have ever read. You have also managed to simplify it enough for us laymen to understand (a pity I did not have it prior to investing all of the family’s super into ABC).
Steven

Only have one word to say to you and that is brilliant. Thanx for the effort. Thanx for the knowledge. Thanx for the honesty.
Hayden

Your book was a very good read and well presented. Whilst I have looked at ROE to help myself “value” a company in the past, I have been painfully guilty of using dividend yield, p/e ratios, PEG ratios etc to determine if I should buy shares in a company. I’ll never look at prices again when trying to determine value (only when obtaining my valuations first and then checking the market to see if I should buy or not buy). The insights I have gained from chapter 11 in your book are extremely valuable to me and can only thank you so very much.
Edward

I have just finished reading `Value.able`. It is an understatement to say I am thrilled. You have taken Buffet’s concepts and written in an easy to understand, up-dated and Australian version. Having previously read `the intelligent investor` by Ben Braham I just found your book so much clearer and precise. I do need to go back and `re-visit` some parts for a better understanding but I wish to say thank you for all your efforts in writing this book. I know that my portfolio only stands to benefit and we all need reminding that those `zig zags` on the ticker are actually businesses not stocks, thanks again.
Peter

Thank You Roger. Finished the book. It is one of the best common sense books on investing that I have read.
Peter

Received your book last week and couldn’t put it down. I now look at share investing from a very different perspective
Nancy

Finally I finished your book, this is the only book I read from begin to end in my life.
Henry

I’ve finished reading your book and just about to begin a second read. Fantastic and thoroughly enjoyable. Congratulations, an absolute credit to you. I’m certainly looking forward to Value.Able 2 if it ever eventuates.
Michael

Great book, wish I had it 5 years ago, would have saved a lot of money.
David

I just want to say thank you for the book. I’m really enjoying it – you should be proud of the contribution you have made to the investment process.
Wayne

I ordered your book prior to the launch and, after reading it through once and now going into it in much more detail, I am very certain of one fact. That is – That I have been on the wrong track for a long, long time when choosing my share investments. I always knew that something was ” MISSING” AND YOU HAVE SHOWN ME WHAT IT WAS. Thanks for showing me the light at the end of the tunnel. Great book, it has really got me fired up again!!
Kev

Thankyou ever so much for writing an easy to understand investing book.
Monica

I really enjoyed your book. Must be the best investment book I have read.
Andrew

A comprehensive well written piece on investing, written in plain English with valid and humorous analogies. A book valuable (excuse the pun) for both the neophyte & expert or professional on (what is termed) Value Investing, both in general & how it relates in Australia. I have never seen DRP (Dividend Re-investment Plans) covered anywhere else & the relevant references to tax implications/advantages for Australian’s can only be found in an Australian book. The fact that it only took 8 months to write, and is in such detail, truly demonstrates Roger’s thorough understanding of investing. Well done, only wish I had it sooner.
Quenton

And a few from my Facebook page

I got my book this morning, totally made my day!!!! Can’t wait to get stuck in to it this weekend, read a bit just very quickly at work and had trouble putting it down. There goes my sleep plans for the weekend.

The book arrived, whoopee some solid reading for the weekend. I hope it rains.

Woo Hoo! I got it. I was woken up by my wife singing happy birthday (it’s not my birthday) and giving me a parcel.

Yeah! I got it today. So happy right now, I’m like a kid in a candy store!

My Book arrived, and you can’t wipe the smile off my face! A new road map to my investing success.

Just chiming in great content from what I have read so far… Great book. Recommended to all my friends and family. =)

I got the book, thanks Roger…. I will have to send the wife and kids away for the weekend so I can read it!

Got mine just then! On my way to uni, but I think this will take preference over financial statistics….

Thank you Roger for my edition of Value.able. It arrived in perfect time today to greet me at the door for my birthday. It looks a lot easier and much more fun to read than other books. I’m confident I’ll fully be able to understand and apply the principles.

Hi Roger, your book has safely arrived and the cover looks very stylish. I am sure the guts are even better. Looking forward to start reading it

Got the book today. Great cover and even looks good without the cover. Am busy reading it now. Looks great so far. Can’t wait to finish it to be honest.

I received my book today – my assignments can wait. I’m doing some Value.able bedtime reading.

Just got your book yesterday and have been reading it when ever I get a spare few minutes. So far the only thing that comes to mind is this. If Ben Graham’s Security Analysis is dubbed the “investment Bible” then Roger Montgomery’s Value.able is the “New Testiment” of that Bible. A great job!

And some already on the blog

Got it yesterday. Couldn’t put it down last night even with the footy on the tv. Clarity through knowledge and understanding – that’s what this book is offering me.Thanks so much.
Mani

Value.able was delivered last Friday. Took it (and my wife) away for a weekend up the coast. Roger, your book is a brilliant effort and importantly, for the value of the concept you deliver, it is entertaining and easy to read. If Value.Able – Chapter 6 – ROE, had been available before I bought shares in two companies on a tip sheet recommendation, I’d also be a few $$ better off.
Ivan

Congratulations on the book, have given it a quick skim and will be giving it a more thorough going over in the weeks ahead, but have already recommended it to a few friends based on the quick read. Looks like a pretty thorough and commonsense treatment for investors and an excellent addition to the bookshelf! PS: Saw you running like a maniac down George St at lunch time today – I immediately decided to start carrying your book with me to get that elusive autographed copy!
Jake

I got your book today.  The bad thing is I now have to work for eight hours before I get to read it!!!!!  Thank you so much.
Terry

I have had the book for a couple of days now, and my impression is that it is the best book I have so far read on investing. It’s a fantastic distillation and a voice of perfect reason. Your valuation method is very easy to follow.
Robert

Click here to read more comments and see the first photographic evidence of Value.able in action.

Thank you for your kind feedback and encouraging words.  If you would like to keep adding your thoughts, inights and stories, please Leave a comment here at the blog, or join me on Facebook.

Posted by Roger Montgomery, 3 August 2010

INVEST WITH MONTGOMERY

Roger is the Founder and Chairman of Montgomery Investment Management. Roger has over three decades of experience in funds management and related activities, including equities analysis, equity and derivatives strategy, trading and stockbroking. Prior to establishing Montgomery, Roger held positions at Ord Minnett Jardine Fleming, BT (Australia) Limited and Merrill Lynch.

This post was contributed by a representative of Montgomery Investment Management Pty Limited (AFSL No. 354564). The principal purpose of this post is to provide factual information and not provide financial product advice. Additionally, the information provided is not intended to provide any recommendation or opinion about any financial product. Any commentary and statements of opinion however may contain general advice only that is prepared without taking into account your personal objectives, financial circumstances or needs. Because of this, before acting on any of the information provided, you should always consider its appropriateness in light of your personal objectives, financial circumstances and needs and should consider seeking independent advice from a financial advisor if necessary before making any decisions. This post specifically excludes personal advice.

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110 Comments

  1. Hi Roger.
    Do you have examples of how you would determine the Intrinsic Value of say TCL (Transurban an infrastructure stocks, ie the example in my previous post) ???

    The other example I would like to pursue is for the likes of a fund manager like ARG ???

    How you get these to a common base so that we can compare apples with apples.

    Regards JC……

    • For TCL you could start with a cash flow estimate and then a return on equity before valuing the equity if using an excess return model. ‘Common bases’ for wildly different businesses may in fact not be the goal. Better perhaps to think first about the economics of the business and get to a cash flow number that more accurate reflects the economic profit. Then you have a starting point upon which valuation models can be applied. Without a second book it will be a challenge to get it all down.

  2. Hi Roger.
    I have the book and using Chapter 11 to determine Intrinsic Value. Please note I am non commercial (and an engineer). At first I was perplexed why I need to nominate a “Required Return” to gauge a value from that sea of data. Currently I simply only used 10% and treat the process a simply a means of comparison and monitoring over time.

    Are there any conditions that arise that you think that I would have a legitimate need to vary this from 10% ???

    Also, I read some where in this “Blog” the reason why this process (“Intrinsic Value”) is deficient where it comes to the likes of ARG (AFI and possibly MFG). This was mainly to do with their reporting structure where the dividends of the holdings are reflected as the earnings of the fund (without consideration of the retained earnings within the holding).

    Is there any discussion available about the fallibility of this Intrinsic Value process ??

    Also (and possibility related to the previous question), I was crunching the numbers for TCL (Transurban). The dividends are >> earnings.

    This issue seems to effect the validity of the Intrinsic Value process ??
    and how is it possible for this case to occur in the first place for so many years running ??

    Regards JC……

    • There are limits to any estimate of intrinsic value. It’s essential you remember that intrinsic value is just an estimate. The limitation of the model in Value.able is the fact that it is a straight line model. That limitation is discussed in Value.able itself. With respect to discount rates the number you use can be related to risk free rates and equity risk premiums that may be derived from the weighted average cost of capital. Sometimes however it is simply and perhaps just as effective to adopt a number that approximates the return you want rather than the one you think the market is using. When it comes to TCL and other infrastructure stocks, there are a couple of issues. The first is that depreciation overstates the cost of maintaining the roads. Therefore the cash flow is much higher than the earnings. When calculating intrinsic value, one would adopt a return on equity based on the cash flow. The second point to note is that the discount rate used in the market to value these securities has been very low because the natural owners of these assets are large global pension funds who are seeking returns of inflation plus a percent or two. So the buyers required return is very low currently. Further, the market generally values these assets highly because the WACC formula applies a low rate of interest to the debt and the debt is a large proportion of the capital. The end result is a very high price when interest rates are low. Investors however only have to wait to see that while these securities will hold up the longest in a bear market – and may be the last to fall – they are not immune to declines. During the GFC, the price of Sydney Airports fell from $4.48 to $1.45. Today’s price of $6.50 is not permanent either.

  3. amit.raisinghani.96
    :

    hi. roger

    i m from india. i would like to grab a copy of your book.. can u please explain the procedure..

    and is it available in india and US.

  4. Hi Roger,

    I am fairly new to investing and just wondering if this book would be for me as I am worried about not understanding some of the terminology?

    Thanks

    • Hi Kumar,

      I will let a few of the “locals” here at the blog who have read Value.able, describe how it has helped. Personally I think it will be beneficial, but don’t ask the barber whether you need a haircut.

      • William Gill
        :

        HI Roger /Kumar
        Since retiring from small business several years ago I have been a very sucessful investor, I have read a number of investing books, and I believe Valuable is the simplest and easiest understood investing book of all.
        After reading Poor Charlies Almanac I also believe Rogers ethics are the equal of Charlie

      • Hi Kumar,

        Roger has the ability to explain complicated things in a simple way .This is a rare gift.

        I have recommended the book to countless people and have loaned the book to countless others. For every one of those that have read it they have all got something out of it.

        It is a very easy read and unlike the name it is not value.able it is invaluable

  5. Hello Roger,

    Just started reading your book and absolutely love it! I reckon it’s gonna change my whole perspective on sharemarket investing.

    I’ve got a quick question regarding pg 69 where you mention the company’s profits will rise by $1.40 from $20 to $21.40.

    How did you calculate this increase in profit of $1.40 exactly?

  6. Hey Roger,

    I’ve already read other books on value investing and followed couple of your investor hour seminars. Is there anything new in the book?

  7. Hi Roger

    Just received the book. Cannot put it down and will read it more than once. Wish i had this resource rather than rely on brokers past comments to buy/sell a stock. I will rely on ROE/profitabilty for my future investing. All makes sense!!!!!!!!

  8. Hi Roger,

    I really enjoyed your book. I am delighted it has been written as I always wondered how to determine the value of a listed company. I will try to put it to good use. I also enjoyed your recent slot on Switzer and the portfolio you are monitoring. I suppose the proof of the pudding will be in the eating ! Keep up the good work.

    best wishes

    Bill McGeachie

    • Hi Bill,

      Thanks for the encouraging words. SInce there are a few portfolios running with very good eating, I am not too concerned. Of course no-one can forecast what share prices will do in the short term.

  9. Just finished! I wish I could have read this 10 years ago.

    For clarification; you use cashflow as opposed to published earnings to judge company profitability but when it comes to working out the dividend payout ratio do you use published earnings or your cashflow claculation agains divs per share?

    Cheers

  10. Hi Roger

    Although it’s taken me a while to get around to it I’d like to share my thoughts after reading Value.able. I read the book as quickly as I could and found it so interesting that I couldn’t put down. I would rate it as the best and most practical book about investing that I’ve ever read. A definite A1 and a bible of how to be a successful value investor rather than market gambler.

    The greatest message I got from the book is to look past the short term madness of the market and simply focus on buying only the best business at cheap prices. In the past I’ve hoped to do this but I didn’t really know how. I relied on broker’s research and ratings, plus a few times looking at price graphs and mistakenly believing a business is “cheap” just because the price has fallen. While this often worked I put it down to luck as I didn’t really know what I was doing. Before reading Value.able I really understood only the basics of separating a good business from a bad one and had no idea about determining a good buy price. I’ve also found that many brokers and advisers shouldn’t be listened to and you really need to do your own research. I think your comment in the book that brokers and advisers often recommend investments just to generate fees is spot on. All investors should learn how to do their own research and not rely blindly on advice. For me, Value.able is the perfect research tool and a way to avoid bad advice and high fee costs.

    Value.able was exactly what I’ve been looking for to fill in the missing gaps by teaching me how to buy quality businesses and great prices. It has given me an easy to use methodology to estimate intrinsic values before making a purchase to avoid the guesswork. After review my current portfolio, I find the information and methodology in Value.able checks out. All my best performing stocks all have high ROEs and were purchased near intrinsic values. The worst performers all have the many negative characteristics outlined in Value.able, such as low ROEs, capital raisings, goodwill write downs, poor management etc. I will hopefully avoid such dogs in future and the advisers enthusiastically recommending them.

    Apart from the intrinsic value methodology, I also enjoyed your tremendous insights into how good businesses operate to help spot the highest performing and healthiest businesses. Chapters such as the one on cashflow were great, plus the arguments against relying on only traditional P/E ratios. This stuff can be hard going but the book explains it very well with many interesting examples of well known Australian companies. The post mortem on ABC Learning was fascinating and is a valuable lesson on avoiding bad businesses. This information will help investors to avoid the future corporate collapses and poor long term performers like Qantas and Telstra.

    After reading Value.able I’m confident I will make smarter and less riskier investment decisions in future with a greater chance of success whilst avoiding the market dogs. Value.able has given me a huge boost in my ongoing quest to become a more successful investor. A must read for all investors!

    Steve

  11. Roger & Friends – a lttle Value.able help if possible please?

    Confused here! I can’t get the reasoning behind some numbers in Value.able Page 108, paragraph 2, discusses some Wesfarmers per share stats:

    Equity: 21.28 Intangibles: 17.82 NTA: 3.46 Borrowings: 4.61

    Para 3 then says “On a per share basis, shareholders own 21.28 of the business, but they owe 13.19”. Where does the 13.19 come from? I can’t get my thinking around why they ‘owe’ that amount when ‘borrowings’ are mentioned as 4.61?

    If shareholders ‘own’ 21.28 and ‘owe’ 13.19, then it seems like on a nett basis a shareholder would own 8.09 (21.28 – 13.19) Is this because they ‘own’ the NTA and the debt/ Borrowings ie 3.46 plus 4.61 = 8.07? (rounding)

    So Equity – NTA – Debt = ‘Net Ownership’??

    Or should I be thinking Intangibles less Debt ie 17.82 – 4.61 = 13.21? (The maths adds up but I can’t figure out the reasoning; kind of the same thing really)

    As Intangibles are generally ‘purchase premiums’, is it an accounting thing whereby Intangibles are sort of classed as ‘soft liabilities’ on the balance sheet, and reduced by taking on ‘hard debt’?

    Methinks I may be bamboozling myself – and/or I may just need a maths lesson! Thanks for any help in advance :)

      • Thanks Roger

        I might just need to get my terminology straight – I was working under the impression that borrowings and liabilities were the same thing?

        I have seen ‘short term’ and ‘long term borrowings’ bandied about and thought they were interchangeable!

        Are ‘borrowings’ just another name for short term (current) liabilities?

      • Cheers Roger

        Just so I’m clear, Total Liabilities less Borrowings = non-interest bearing loan liabilities; that would be items on BS such as A/C Payable and Deferred Tax?

        May I also ask what your thoughts are on what constitutes debt? Is total debt = total liabilities?

        I have read that some analysts classify bonds as ‘debt’ while loans are ‘liablilities’, so where does that leave borrowings in your mind – are bonds included in borrowings due to coupons paid? (Discounted notes too?)

        And what of preference shares – they are often considered more like bonds than shares, so do you include them in borrowings as well?

        Many, many thanks yet again!

      • Hi Mick,

        Phew! DIfferent definitions seem to exist for these things. You may also find slightly different labelling in alternate company annual reports. Just use those. There will be notes that will also help explain. I have not seen bonds called debt and loans called liabilities exclusively. The terms of the prefs will determine how they are treated but so will the auditors ultimately.

  12. Hi Roger,

    Just looking at my company half year report and was wodering if a more acturate ROE was to just calculate the difference between total equity from year to year rather than profits..?

    • Hi Peter,

      regarding just using changes in equity: Keep in mind, dividends may have come out and there may have been capital raised or shares bought back which will increase or decrease equity respectively and there may have also been changes/revaluations put through the ‘reserves’.

  13. Roger

    Just received the book………absolutely loved it and will be buying more for friends and family and have already sent emails out to my investment group to purchase the book.

    Not long ago you posted answers to a series of questions and one answer struck me when you talked about the tables found in chapter 11. Such a wonderful collection of work I’d imagine there are a lot of people trying to dissect your work…..i don’t care about the formula one bit. What I was wondering was if you could post the entire table. Currently it goes up to 14% required return….would it be possible to see up to 20%? or possibly down to 5%?

    With the shenanigans our central banks are playing all over the world, we are either heading into great deflation or hyper inflation in the up coming years. In either case 8% and 14% will not suffice.

    I want to thank you and congratulate you on a wonderful book. Your fans are a tribute to your hard work and after years of having to explain investing to friends, I finally have a book to throw at them that covers it all.

    Great work!

    TOM

    • Hi Tom,

      I have had a few requests to expand the tables. Let me think about how to do that so that only investors who have bought the book can receive it. You should read my comments in Chapter 11. WHile I expect some people to dissect the formula, they are seeing the wood for the trees. I mention that the formula has flaws and for this reason I adopt a different model. Its an excellent model but like so many its just not perfect.

      • Thank you for taking time to respond to my note. I’m on my second run through the book and it truly is fantastic.

        May I suggest that you simply email the table out to the emails that we provided to you upon purchase of the book.

        I greatly appreciate your level of commitment to your followers and although the book will lead me to some great investments down the road, i can’t help but think that ultimately this purchase will rank up there as one of my best investments.

        Cheers

        Tom

  14. Roger,

    I am up to about Chapter 4 in your book this is my first read and I will start over when I finish it.
    There is much to absorb in your book.
    I think it true that I have made every mistake so far detailed in the book.
    I have repeated some mistakes many times !!!!!

    I was born 1928 and bought my first shares at about 22 years of age and later lost that money.
    Retired 1984 with money invested in 35 fund managers. Lost 5 years of gains in 1987 crash.
    Only one company recovered in 6 months (BT who had hedged their fund)
    Decided to manage my own money and have been very successful and lucky.

    I had and still have a discipline and a criterion for buying shares.

    First to get rich slow rather than aim to get rich quick.
    Second to aim to reinvest 50% of income to give compounding a chance to do its magic.
    Third never to be swayed by “hot tips” or analysts but rather decide for myself what to buy and sell.
    Fourth generally buy to keep and hold most stocks held for a decade. I probably tend to keep losers too long.
    Fifthly always try to have 90% in “Top 100” and mostly buy shares with full imputation credits.
    Sixth have regard for taxation consequences (CGT) and sell winners when able to offset capital gains with capital losses.
    Seventh look at graphs covering share price also dividends for a decade or so. Look at liquidity in volume of shares traded.
    Eighth never buy shares that I must sell on a set date to repay a loan. That set date will turn out to be the lowest the share has been in a decade!.
    Ninth hold about 20 shares
    Tenth never to panic no matter what is happening in the market. History shows the market always recovers from a down-turn. To me share trading is a challenging hobby. A lot more fun than playing on poker machines!

    My rules seem likely to change after reading part of your book and seeing much of you on TV and UTube.
    I am sure you have a better way to buy/sell shares.

    Thanks for what you are doing to promote Intrinsic Value
    Regards

    Russ

  15. Hi Roger i have read your book , and it is by far the best investment book i have read . i read it a bit to fast so i have to read it again .
    only wish it would of been available 14 years ago .

    i really like the way you explained company debt competitive advantage return on equity organic growth
    and using analogies to explain ,even the effect of inflation on savings
    and increase in earnings does not always men increase in roe
    the way you use the bank account returning 20% to explain what you would maximum pay for the account is just one of the good ones

    i will write a proper review and post it on your blog

    Roger this could be the best 49 $ i have spent, if it does not make me any money .
    I am sure it will protect me from making stupid investments in future , and i have made my faire share ,
    you have a gift in explaining the complicated simple and explaining so people understand . i am not an educated person and my english is not the best
    your book gets an A1

    Best reg Nevada Cody

  16. You can find eps and dps on comsec if you go to company info then
    company wrap on the right of the table in black.

  17. Hi Roger

    Just received and read your book and will read it again so it sinks in! A bit concerned about some stocks in my current portfolio so will have to run your valuation rule over them and make some tough decisions possibly. Followed you for quite a while so although my stock picking methods have differed greatly from your valuation model I have some of the A1’s and great businesses that you espouse and not too many duds (Good luck or Good design?) Love how you de-mystify what others spend a lot of time trying to shroud in mystery. A lot of very intelligent people lack basic common sense and it seems to me that is what you try to apply in conjunction with intelligence and knowledge; so congratulations. As an accountant I resemble some of your comments re: accounting goodwill and book values! LOL. They can be tenuous and rubbery at best sometimes. Thanks for sharing your knowledge.

  18. Hi Roger

    Just managed to finish your book Value.able.

    Well I have read a lot of different books and materials that twaddle on about a lot of different approaches and formulas. That some how miraculously predict what markets are going to do and how I will best profit from them. But your book it takes the cake! Why? Because it is nothing like any of those books I have read before! (other than material about Warren Buffett or Charlie Munger).

    This book I thought was extremely well written and put together a most rational and almost too simple approach to investing. And everything that was opinionated made plain old sense. I am still a little confused why companies and investors have not taken to Value Investing as being the only superior way to maximise returns over a lifetime of investing. I suppose a conflict of interest exists, due to Value Investing’s need to buy and hold a business for a longer duration has market makers, not so happy for 2 reasons.

    Firstly, they make incremental revenues from activity, not passive investment. So holding onto to a stock forever is not good for their business as brokers. And secondly with Value Investing, even buying has a real need to sometimes wait long periods before any acquisitions make sense exercising. This is also off putting to most brokers whom would rather tell you about a great stock and get you to trade sooner.

    I think their is some greater body that influences our university’s to teach that active trading and this way of thinking about a stocks value is a practical and rational manner in which one should adhere too. I studied accounting several years ago and was taught how to prepare and understand financial statements. Then next they also taught you how to value stocks, using statistical and discounted cash flow models like you discussed in your book. I now question why did I not question these later subjects on investment, when I already should have known it did not make any sense from the point of view as an accountant?

    I am also suffering from major cognitive dissonance! Because I spent years studying and believing all of these concepts as having relevance in a investment framework. The costs of which for subjects, books and time was huge. I think it could of been a lot better spent on buying some extraordinary business’s below what they are economically worth ( with a decent holiday away attached).

    I noticed what I believe to be a mistake in the figures for Table 9.1 on ABC’s cash flows. Was this a deliberate mistake to see if anyone was actually reading the tables or not? Or have I just interpreted your table wrong. For example Net operating cash flows Jun-99

    Receipts 8

    Payments -6

    interest paid -1

    (8 – 6 – 1)= 1 you had 0

    I also did not find the gold you were talking about in your blog? However I then discovered that the real gold was saturated across the pages throughout the whole book!

    Once again it was a great read. I think it has opened up a new way of thinking for me in my endeavors to become a successful investor. However I still require a book that explains how to finance a portfolio of extraordinary business’s, trading below their intrinsic value! Ha Ha!!

    With regards,
    Carl

    • Hi Carl,

      Thanks you ever so much for taking the time to write such an engaging post. The difference is just rounding but thanks for pointing it out. You have indeed found the gold!

  19. Roger – so sorry for the tardy reply, had a bit of reading to do as it happens!

    Yes Value.Able arrived safely thanks, and it is all I thought it would be and so much more…

    Now you have to cop some appreciative thoughts and thanks – as you’re humble, perhaps take it as feedback if you’d prefer; thanks nonetheless!

    Cover
    Yep, the coin looks great – and so does the $100 as the title background; another great touch. I have taken the cover off for posterity, but have to say the green/silver is potentially better than the flash cover for mine – sorry! That clean, simple look reeks of knowledge; gives it a kind of classic, scholarly feel; fit for a king’s library sort of thing. All class mate.

    ‘Side-notes’
    I’ve never read a book that had that much blank width at each side of the outside of the page – superb! No moving fingers to read a sentence; no smudging while turning pages; and I hate when half the page is taken up with footnotes below – it’s like trying to read 2 books at once.

    I did find the italics for the sub-headings within the chapters a little harder to read (my eyesight is good); too thin and too light for me to really stand out; it doesn’t matter though, as I was going to read every single word over and over anyway! No offence intended at all, just my thoughts.

    Content
    I’ve followed you for what seems a long time now, and researched all the hints you’ve dropped (Richard S, James Walter etc); as a result, I pretty much had the basic formulas but no idea of how to combine them – some the pieces of the puzzle, but no vision of the picture to be completed.

    The tables throughout were very helpful for my understanding, and although I would have loved the formulas in the book, I’ve got them nutted out and spreadsheeted so all good there. In a funny way, the numbers weren’t so much the drama, the conceptualisation of the big picture was – this is the real strength of Value.able in my opinion.

    Tiny phrases seemed to create a plentitude of ‘a-ha’ moments for me, especially implied growth and economic goodwill – I think your explanation re goodwill is better than Warren’s appendix on the same topic! In short, it filled the gaps in my understanding that I needed, and answered the questions I wasn’t going to bombard you with via blog and email.

    You have implanted a ‘financio-mental frame’ in my head; whenever I see a $1 coin now, I think of A) Value.able; B) the lessons that $1 coin taught me while waiting for the book (time/patience/frustration management); C) investing $1 with a view to obtaining at least that in return.

    Congratulations on Value.able; thank you for your attitude and humility; and looking forward to your future thoughts and efforts – I will be watching with great interest.

    Cheers,

    Mick

    PS Did you send Warren a copy?

  20. roger i am a kiwi. was going to watch the all blacks beat up aussie but your book made me miss the game and who cares i am on my second read just luv it knowledge is wonderful

  21. Elizabeth Pryce
    :

    Dear Roger,
    Thank you so much for the special edition of your book which I received last Friday. As you know , I have been a “Roger” groupie (even tho’ an ancient one !) for a good number of years and am so delighted to have your book. As a fellow member of the ASA said the other night- if you every decide to run a seminar we would stand in line. Please don’t make it until after the 14th.October. All good wishes to you and your family
    Kind regards
    Elizabeth

  22. Hi Roger,

    Congrats on the book, brilliant effort! I am reading up and trying some of your calcs now.

    You used foreacsted ROE for your JBH example. Forecast ROE info is quite hard to come by, at least for me. Could I just use forecasted EPS / equity for current year to get forecasted ROE? That sounds ok in theory, but I have that odd feeling I am double counting somewhere.

    Is it possible for you to set up a side forum on this blog where we can ask questions on our calcs? Like a Q&A forum specifically for calculation queries. Just a suggestion..

    • Then maybe what will happen is ppl will visit hotcopper for rumours and visit your blog/forum for some good “meaty” information.

    • Hi FC (could you leave your name too?)

      Yes you can estimate ROE that way. I am currently writing a bunch of practice examples for you to compare your calcs against. Stay tuned.

  23. Thank you for writing value.able. It’s enlightening. But it seems that whether a stock is a value buy hinges entirely on the selection of the payout ratio. Take your JB Hi Fi example; if a 100% payout ratio is selected instead of 50%, the intrinsic value will become 10.73. And that rules out JBH as a worthwhile investment to pursue. The same conclusion can be drawn on all of the 20 blue chips I have tested using Table 11.2. amongst which are BHP and the four pillars. Please can you throw some light on this observation

    Secondly please advise where I can access the latest ROE figures online. Currently I am relying info from ComSec and they can only provide 2009 data

    • Hi Steven,

      Broker research has forecast ROE figures and there is plenty of that available online. ALternatively you could open an account with an online broker. I will chat to some of my friends and see what I can arrange regarding access to research for you all. Regarding the valuation being dependent on the payout ratio, this is both right and wrong. The valuation is dependent on all inputs. if you change teh discount rate, change the ROE or any other input, the valuation will change. CHarlie Munger was asked what made him such a great investor and he replied; my guesses are better than yours.

  24. G’day Roger,

    I have learnt a great deal from your book. The most important part for me is that you have set out the actual steps involved in the process and that you make yourself available in continuing to educate people.

    I would like to congratulate on the release of your book.

    Thank you very much for sharing your knowledge. I will now start doing some homework with this knowledge and attempt to value some of the A1’s.

    Kind regards,
    John

  25. Hi Roger

    I’ll like to inform you that I received Value Able in the mail yesterday and immediately started reading the book.
    Some late nights ahead immersed in the book together with writing notes during the next few weekends to fully develop an appreciation & understanding of value investing.

    I would like to congratulate you for sharing your wisdom and clearly framing the book in a very clear manner to assist people in identifying value stocks.

    Investment managers no matter where they are should be very afraid considering there is a new dawn of individuals who have purchased your book and together with the time required and the assistance given by your book to investing in stocks which are of value & will gain a far better return than the poor performance investment managers have dished out in managed superannuation funds over recent times.

    Once again thank you.

    Regards

    Mark

  26. Roger; you have spoiled the party. No more overpriced takeover offers? Those that need to read Value.able probably won’t but of course if you already know it all why bother.
    Seriously though its been well worth the wait.Congratulations.

  27. Roger,Read the book.Gave me back enough ,zing,if that is a word ,to go back into business at which I started in London in 1968.After that I was in N.Y.C, H.K,and ABU Dhabi.A great constructive piece of work,Many Thanks to you,John

  28. Just finished the book, for the first time that is, superb, helped me decide to shoot a few of the dogs I have had hanging round my portfolio so I can invest the money (after the capital loss!) in a few a1’s (as I can begin to calculate them). Chapter 11 of this book will live long in Australian investors memories
    thanks again for sharing Roger
    si

  29. Roger

    Thanks for writing the book. By far the best investment book I have read.

    Have you sent a copy to Warren & Charlie.

    Thanks for all the references. Is it worth tracking down the original material you have referenced? is it easy to access?

    I would like to buy a copy for my brother. What is the best way to do this. If available what is the estimated delivery time?

    Thanks again.

    • Hi David C.

      For those with an inquisitive mind, I think the original material is very rewarding. If you have the time go right on ahead and dig up the material online. Its all there. The Journal of Finance is wonderful place to start and the names of the authors to search are mentioned in the book.

      If you would like to order a copy for your brother, just visit http://www.rogermontgomery.com and order again online.

  30. I have received your book Roger with many thanks. I would like to take the opportunity to congratulate you on your willingness in sharing part of your knowledge for those willing to take an interest in Value Investing. My first two trades were speculating on tips I had received on companies that did not fair very well. Since then a friend of mine introduced me to Benjamin Graham & Warren Buffett and I took an interest in Value Investing. This lured me to your blog and talks on the business channel. I have learnt a great deal since then and it shows, as my portfolio is now making returns. So thank you for helping people like myself on the road to Value Investing.

  31. Heather Hillman
    :

    Hello Roger
    You have made the KISS method your own! Never before have I kept reading, reading and reading a non-fiction book! Took lots of notes and resisited charging to the back chapter first. Now my biggest concern is how to get rid of all my duds . Again it’s sentiment which kept these shares in my portfolio – just kept waiting patiently for them to return to their former glory – a bit like hoping that an expensive dress which was a bad impulse buy will sudddenly look fabulous! No more sentiment.
    Book layout is great and it was worth the wait to ensure that there were no widows and orphons.
    There is an assumption that all your readers are paying 50% tax – I am a retiree with a SMSF so just keep adjusting the franking credits.
    Best Wishes

    Heather

    Thank you.

    • Thanks for the wonderful feedback Heather. As much as possible I have tried to keep tax out of the equation because everyone is indeed on different rates. In valuing companies we discount the after-tax streams of cash.

  32. Hi roger,

    Loving the book, fantastic read!

    I’m loving all the Buffett quotes and I love that Netbanx example of people who get carried away… Top stuff.

    I’m looking forward to seeing your valuations for Woolworths, because I’ve been trying to calculate my valuation and I think either 1) I’m doing something wrong or b) my forcast data is incorrect..

    Cheers.

  33. Hi Roger,

    Just received my copy of value.able and read most of the introduction, can definitely see the graham dodd influences especially in the book structure. Will probably give it a thorough read over the weekend and tell you what I think.

    Hopefully this book is a great success and maybe we just might see some Roger Montgomery action figurines in the near future, you never know!

      • Hi Roger,

        In the ROE chapter I think you gave an example that went somewhat like this: A business with an equity of 100 is able to get a ROE of 40% as in make a profit of $40. During next year the business decides to purchase another company costing $40 that reaps a return of roughly 5% therefore the new ROE would be 30% [(40+2)/140].

        A 5% return is hardly impressive when factors such as risk, opportunity cost and inflation is considered. But lets now assume that the acquisition somehow reaped a return of 30% thus generating a new ROE of roughly 37.14%. It could either do this or give out all profits in dividends and still maintain its 40% ROE next year.

        Lets just assume that the company is unable to replicate its original ROE of 40% after its initial 100 in equity and a 30% return from the acquisition of company x is its best business option. What I don’t really understand is why giving out all of the company dividends to shareholders and maintaining a ROE of 40% is more valuable because a 30% return is much more impressive than what I would be able to do with it.

        Sorry for the elementary question but I am genuinely confused, thanks Roger.

  34. Roger

    Congratulations on a well presented and brilliantly written book… still working my way through. When I read I can hear you saying the words. The message comes through very clearly, and brings together all we have heard you saying on Switzer and the blog.

    As for a workshop in Perth – brilliant idea. Perhaps think about it outside the ASX to allow for more flexible times and perhaps content.

  35. Hi Roger,

    Started reading tonight and have just finished part 1. Really enjoying it. Page 044 – I take it you never got invited to many broker lunches in your fund management days ;-)

    Regards,
    Craig.

  36. Truly a great read, thanks for sharing your Value.able insights Roger. Can you please recommend any sites/sources in which to obtain analyst research?

    Cheers
    Daniel

    • Hi Daniel,

      To remain independent I don’t recommend any third party information…with one exception. Morningstar’s Shareholder compendium contains up to ten years of data for the 500 largest companies. I believe it is published twice a year.

  37. David Maynard
    :

    In the course of my working life the best managers , i found , have been those willing to teach and better those they manager , offering them help and encouragement.You are to be commended for your genuine attempt to show people, like me , a better way to invest that is clear and concise.Thanks for the book.Regards.

  38. I have recently received your book, read it and finished it. I quite enjoyed it, thank you very much.

    Just a suggestion: we should all learn from mistakes, hopefully other people’s mistakes(!!). For example, I love Giverny Capital’s mistake de jour entries. Perhaps revisiting some mistakes from the past would make the book more complete.

    • Hi Peter,

      A good idea Peter. I am happy to say the list isn’t too long. There are other general and well publicised examples – those that have triggered class actions, but for that reason they may be something for the next book perhaps? Once they’ve settled.

  39. Its so hard to be patient and l feel a lot like ashley although I didn’t think Adelaide was considered a rural area as I haven’t received my copy yet either!! I guess all good things come to those that wait……i really need your book to help me stop making bad (or is that stupid?) decisions and having my wife laugh at me – although her laughter usually turns to tears when i mention that its ‘our’ money i’m losing!

  40. Roger,

    Received my copy of Value.able yesterday. I experienced a number of ‘light-bulb’ moments whilst reading part one.

    Thank you.

    Regards
    Sean

  41. Roger

    What is the formula behind table 11.2?

    Calculating the value of an infinite life asset that has a 100% retention rate and a ROE different to the required return is a mathematical impossibility.

    That you have produced a table with values for a mathematical impossibility implies that there are assumptions made via the formula to overcome the problem.

    In my opinion, these very assumptions are the most important element in valuing growth. Without the formula I can’t assess the validity of the assumptions.

    • Thanks Gavin. I don’t believe that problem is solved but I do believe neat solutions exist. Most investors don’t want formulae that can be misused and which can also be rather intimidating. I have given you, in the book, the names of the celebrated thinkers upon whose formulae the table is based. Google will give you the answers you seek. Just type in their name followed by ‘valuation formula’.

      • Thanks Roger

        Walters I’m familiar with – but his dividend discount formula for 100% payout doesn’t produce the same figures as your table.

        Simmons I’m not familiar with and I can’t find anything on him other than reference to his book which I don’t have and can’t find in Aus.

        Any other leads or perhaps you would be so kind as to send the formula to my personal email address.

        I understand your not wanting to complicate things, but I don’t see the formula as a complication but as a necessaity to understand how ‘you’ are determining the valuation for the retained component.

      • Hi Gavin,

        I think you mean 100% retained. As I say in the book, the variation should matter less than the very large discount you should be seeking. Does it matter whether a 6’4″ man weighs 40 kilos or 45 kilos? No. He is clearly underweight. Its the same with valuations. Don’t get hung up on whether the number is $4.45 or $5.00. Buffett says if the price is $4.20, its too close to call. You should be buying at $2.00! Simmons work is useful for 100% retained.

      • Hi Roger,

        Re table 11.2. At the bottom of page 184 you say you “made it more conservative”. It is possible for you to quantify how much more conservative, or comment otherwise?

        During the intrinsic value calculation process it is possible to build in conservatism by various means (for example, round down the company return on equity when selecting the relevant row to enter the table), which is fine by me. But when I come up with my instrinsic value, I’d like to know how much conservatism I’ve built in. I think this will help me decide how far I want the share price to fall below intrinsic before I pull the trigger and buy.

        Congratulations on an outstanding publication that sets a new benchmark in the quality I now expect from other authors going forward.

        Regards,
        Craig.

      • Hi Craig,

        Thanks for the feedback. I am really glad so many people are finding it valuable (no pun intended). Regarding that table – which is causing some people distress. You can use a mathematical tool called a utility function although there are a number of other means of achieving the same result. Please don’t ask for the formula; I have already seen a website with a post that claims that my method is “almost exactly” like theirs! As I know of nobody globally that has developed anything that approximates it – I doubt that to be true. I have provided all the inputs you need to go and build it yourself, the sources of the basic version and the results. I note in Buffett’s, ANNual Letter to Shareholders he also provides the inputs but refrains from supplying his valuation for Berkshire or any formula.

  42. the Charlie Munger quote dropped out of the post somehow…

    the quote was:

    It is, of course, irritating that extra care in thinking is not all good but also introduces extra error. But most good things have undesired “side effects”, and thinking is no exception.

    Look forward to comparing IVs!

  43. Got mine today, looking forward to getting stuck into it! Roger, do you have any plans to do a presentation in Perth in the near future?

    • Hi Tom, Quite a few people have asked. I thought I was doing something for the ASX, if not I might run one myself. Do you think there would be much interest in a 2-hour hands-on workshop?

      • I think there will be a mountain of interest Roger. If you hold one I’ll certainly be dragging a few of the ‘short term traders’ from my office along for some much needed education. Hope to soo you over here soon mate.

      • Roger, I believe you would get considerable interest in a 2 hour workshop in Perth. Recieved the book yesterday, coming to work today stopped me finishing but I should do tonight. Thankyou for your efforts on putting it together, I can see from the comments you are recieving the wisdom is not falling on deaf ears which must be very fulfilling for you, congratulations

      • Hi Roger

        Just recieved my copy of your book. My biggest problem now is to decide which bottle of wine I should open to sit back relax and read your book with.

        A two hour workshop in Perth would be great. If you come over that would be great and I certainly would be attending.

        Keep up the great work.

        Anthony.

    • Hi Eamon,

      Thank you for your optimism. I don’t think there is such a thing as a Holy Grail in investing. There’s just sensible ways to approach the challenge and I think value investing and focusing on the businesses rather than the stocks, represents that.

  44. Roger,

    I got my copy yesterday. Started reading it straight away but I must admit after reading 30 to 40 pages I could not resist to go to the chapter on Intrinsic Value. Congratulations the way you have written it is so easy to follow through the calculations.

    I would recommend it to any one to buy the book and read it even though this the first investment book I have read, may be it will be the last one as your book has all the ingredients for becoming a “Value Investor” like you rather then worrying about daily movement in share prices which is going up and down like a yo yo at the moment.

    I regularly listen to you on sky business channel in fact I have become a great fan of yours. I really like your honesty when you say on the program that “I cannot predict the price of any company shares”. After reading your book now I understand why keep on using that phrase because now I know the difference between “value” and “price”. I am also impressed the way you have explained the difference between investing and speculating by giving so many live examples.

    Note: Roger with my copy there was no Tax Invoice attached in fact it had packing slip. Not sure what happened there. I would like to have a copy of the Tax Invoice please.

    Thanks and Kind Regards,

    Kind Regards

    Daksha

    • Hi Daksha,

      Thank you for those very encouraging words. I really hope you get a lot out of the book. With regards to the TX invoice,it would have been emailed to you when you ordered the book.

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