Quotes About Value

the readers to buy their stocks as they bought their groceries, not as they bought their perfume

Lucent's stock, at $51.062 on June 30, 2000, finished 2002 at $1.26—a loss of nearly $190 billion in market value in two-and-a-half years.

The real money in investment will have to be made- as most of it has been in the past- not out of buying and selling but of owning and holding securities, receiving interest and dividends and increases in value. pxvii

We must recognize, however, that intrinsic value is an elusive concept.

the value of the pledged property is vitally dependent on the earning power of the enterprise.

Instead, calculate a stock's price/earnings ratio yourself, using Graham's formula of current price divided by average earnings over the past three years.

para disfrutar de una probabilidad razonable de obtener unos resultados continuados mejores que la media, el inversor debe seguir unas políticas que sean (1) inherentemente sensatas, firmes y prometedoras, y (2) que no gocen de popularidad en el mercado de valores.

Principle for the securities analyst: Nearly every issue might conceivably be cheap in one price range and dear in another.

Lynch insists that no one should ever invest in a company, no matter how great its products or how crowded its parking lot, without studying its financial statements and estimating its business value.

Besides a cool name and a hot stock, what did Red Hat's investors get? Over the nine months ending November 30, the company produced $13 million in revenues, on which it ran a net loss of $9 million.13 Red Hat's business was barely bigger than a street-corner delicatessen—and a lot less lucrative. But traders, inflamed by the words "software" and "Internet," drove the total value of Red Hat's shares to $21.3 billion by December 9.

What have we learned? The market scoffs at Graham's principles in the short run, but they are always revalidated in the end. If you buy a stock purely because its price has been going up—instead of asking whether the underlying company's value is increasing—then sooner or later you will be extremely sorry. That's not a likelihood. It is a certainty.

It is our view that stock-market timing cannot be done, with general success, unless the time to buy is related to an attractive price level, as measured by analytical standards. Similarly

The future value of every investment is a function of its present price. The higher the price you pay, the lower your return will be.

The market made up new standards as it went along, by accepting the current price - however high - as the sole measure of value. Any idea of safety based on this uncritical approach was clearly illusory and replete with danger.

If you buy a stock purely because its price has been going up—instead of asking whether the underlying company's value is increasing—then sooner or later you will be extremely sorry. That's not a likelihood. It is a certainty.

particularly as to whether they have a clear concept of the differences between investment and speculation and between market price and underlying value.

Buying a bond only for its yield is like getting married only for the sex. If the thing that attracted you in the first place dries up, you'll find yourself asking, "What else is there?" When the answer is "Nothing," spouses and bondholders alike end up with broken hearts.

Such an investor may for example be a buyer of air-transport stocks because he believes their future is even more brilliant than the trend the market already reflects. For this class of investor the value of our book will lie more in its warnings against the pitfalls lurking in this favorite investment approach than in any positive technique that will help him along his path.

The intelligent investor realizes that stocks become more risky, not less, as their prices rise—and less risky, not more, as their prices fall.

Investment must always consider the price as well as the quality of the security.

then that it was by far the best book about investing ever written. I still think it is. To invest successfully over a

we advised the readers to buy their stocks as they bought their groceries, not as they bought their perfume.

knows the price of everything, and the value of nothing.

Benjamin Graham