The book is a technical guide to value investing, focusing on valuation methods and economic truths. It covers asset-based valuation, earnings power value, and franchise value, with case studies to illustrate these concepts. The reviewer recommends it for those interested in business analysis and valuation methods, but notes that the Kindle version is not ideal due to its complex tables and calculations.
This book is a deep dive into the technical aspects of value investing, moving beyond philosophy to focus on practical valuation methods. It discusses three main approaches: asset-based valuation, earnings power value, and franchise value. The book's grim tone is due to its emphasis on the economic truth that excess returns are destroyed by competition. Case studies, such as one on Intel, help clarify the differences between valuation approaches and the necessary industry conditions. The reviewer found the book insightful but notes that the Kindle version is not ideal due to the complexity of the tables and calculations. They recommend it for those interested in learning about economic truths, analyzing competitive positions, and understanding valuation methods.
Quick quotes
The book is less about investing philosophy but mostly about valuation methods and rather technical compared with the other books I read.
Readers are constantly reminded about a simple economic truth: excess returns are destroyed by competition!
For this book I do not recommend the kindle version.