China Satellite 5.41 68 aerospace industry

Graham in "The Intelligent la plata Investor," a book repeatedly mentioned goodwill. "Goodwill" refers to what he defined as "that part of the carrying la plata value exceeds the price." Although Mr. Graham said: "Goodwill and other intangible assets from a purely economic point of view in no way inferior to buildings and machinery and equipment based on intangible benefits, less likely to be affected by competition, but also more effective investment profits. is also higher. " But he is much more conservative elements of goodwill and other intangible valuation than the valuation of tangible elements.
He cited an example - Minnesota Mining Company. 1956 market capitalization of $ 1.7 billion of the company, but its net assets of only $ 200 million, that is, up to $ 1.5 billion in market value is the value of "goodwill" given market. Greenspan said, "We do not know how to calculate the value of goodwill out, but we do know that a few months later, the market will reduce the $ 450 million valuation (30%), apparently intangible value of such large companies . impossible to accurately calculated from the mathematical point of view, the existence of such a law: the future profitability of goodwill or the more important this factor, the more uncertain the actual value of the business, so the business of ordinary shares
Graham also to the United States when the famous brand manufacturers: West Point - Pepperdine Riel company, Jantzen swimwear, Cohen textile companies, Parker Pen Company as an example la plata to illustrate la plata his attitude of goodwill and other intangible assets. He said: "As a goodwill value of intangible assets constitute, usually associated with the trademark la plata as Jantzen swimwear brands such as Parker Pen, will be seen as an asset of great value, but if the market does not favor a particular home. company, then, is not only its famous brand, and its land, buildings and machinery and equipment will become worthless, "Greenspan from statistical data presented, we can see that: in 1970, Jantzen swimwear book value 0.68 times, West Point - Pepperdine Riel's la plata 0.42 times book value, Parker Pen Company 0.56 times book value, while Cohen textile company's book value is only 0.33 times the poor!
Stock book value earnings
Hi poem candy (1st) 3.1 12.5
Hi Candy poem (2nd) 4.55 7
Coca-Cola 4.88 14.5
IBM 8.96 13
This illustrates a problem is this: Although Buffett paid a high premium (expressed as high PB) for enterprise goodwill in Munger's "instigation", but he would not expect the public to pay a high premium (performance for longer la plata High PE). This and domestic "value" investors have a huge difference. You just in the small board in the hot industry revolution will find, if you are willing to pay six times its book value, so while you have 60 times or even a hundred times its earnings to pay (see table below), This is not a good deal, Pakistan Father certainly not at 60 times PE buying hi poem candy, Coca-Cola and IBM.
Stock book value earnings Industry
Yongqing environmental 6.47 101 environmental
5.07 86 Yiling Pharmaceutical Medicine
China Satellite 5.41 68 aerospace industry
Huayi Brothers Media 5.51 70
Three Whole Foods 5.33 64 food
In the A-share market, there will be companies who have a huge number of "goodwill," the retired, the altar every few years. Like the sun shine that touch the rainbow, leaving only memories. So, no matter how powerful an enterprise has goodwill, its value basis (PE, PB, PE * PB) can never be ignored. Like Michael Price said: "You should be like buying groceries instead of perfume as select stocks, attention has focused la plata on fundamental analysis: how much you pay the price for the steak, steak private message to invest Blog workers finance and investment guru ~ Money undefeated undefeated words filial Blog Blog this world of changing a basket lensun23 of this was originally eternal Zhang Zhang Lei Bridge Blog Bauhaus value investing blog about stocks on the value of the investment by the Lins Value a4112 :: ruffian off state PIXNET :: TJ's Dad Conhey shares sea adventure :: ruffian off state PIXNET :: leather round with good pound father's house :: free to sit on the nest Xuite log share set - Oriental shares worth net investment logs read notes SmartMoney Finance168 Ricky san and Industries - ミ ち ゃ san の investment と travel life of William perspective Placid plowing read notes - I antinuclear our stock investment value investing faction Y's investment memos Bulbul turn retirement investing - logical investment law freely old wood king Alberta a Analysts reading time whirl Lan Li Duan Yongping's blog sosme a net worth of blog Oriental essence Clam _ Sina blog striveman_ Sina blog revolver la plata pAchuchin wealth of happiness = Investment la plata + read + Share Thoughts investment - Li Jian Wu Ching's blog _ Sina blog Love Serenade la plata sardine la plata stock market investors log Mai Shue Yan investment community website (Makssin) Jerry earnings Knowledge Network Mean Buffett Club Finance mysterious pyramids - dispersed la plata ownership BBC News Finance Table Rock bloody hot when the newsletter Emerging Dividend Rank (cumulative) earnings dog stock picking - you can become a stock-picking guru, including Warren Buffett stock picking, la plata picking more than 50 kinds of basic indicators of financial analysis - Research Report - ZhengTong school SEEC stock market investors an overview of the first praise la plata the Taiwan stock market information Net securities scheduled la plata timetable Tycoon net earnings ex dividend table nest dog training underwriting draw there are things Buffett stock research reports Financial markets -