February 8th, 2011
McKinsey & Company, the global management consulting firm, recently investigated the biases exhibited by equity analysts. McKinsey was testing for undue optimism or pessimism, and found that
Analysts, we found, were typically overoptimistic, slow to revise their forecasts to reflect new economic conditions, and prone to making increasingly inaccurate forecasts when economic growth declined.
The graph below shows the extent of the situation (Click for full size), showing analysts’ forecasts throughout the year vs the ultimately realized EPS for the . . .
→ Read More: Bullish Analysts Exhibit Behavioural Biases
February 7th, 2011
I came across this video today that features Martin Lipton, senior partner of Wachtell, Lipton, Rosen & Katz and creator of the Poison Pills in the 1980s. I have discussed poison pills in a few places on this site because these frequently arise for value investors when portfolio companies become the target of a takeover. Depending on how you view poison pills, they either delay or enhance the value received.
Talk to Frank . . .
→ Read More: Inventing the Poison Pill
February 5th, 2011
FOR IMMEDIATE RELEASE: SILENT KILLER CLAIMS NEARLY 9,000 AMERICAN LIVES ANNUALLY
Earlier this year that Nina E. Olson, the ombudsman for the Internal Revenue Service, reported that Americans are spending 6.1 billion hours preparing their tax returns each year – the equivalent of 2,932,692 Americans working full time. 6.1 billion hours per year equates to the equivalent of 695,884.7 years (accounting for leap years of course). The World Bank reports that the average lifespan . . .
→ Read More: Silent Killer Claims Nearly 9,000 American Lives Annually
February 4th, 2011
Tags: Vitaliy Katsenelson.  The Little Book of Sideways Markets
How to Make Money in Markets that Go Nowhere
By Vitaliy N. Katsenelson
I am planning to institute a regular feature on this site, whereby I will review one of the books . . .
→ Read More: Reminder: Win The Little Book of Sideways Markets!
February 3rd, 2011
Tags: ITSI. International Lottery & Totalizator Systems (OTC:ITSI) is a Vista, California based company that supplies and services computized wagering systems for the online lottery and parimutuel racing industries and, through its wholly owned subsidiary, Unisyn Voting Solutions Inc., supplies and services electronic voting machines. The company trades with a market capitalization of just $2.59 million. With no debt or preferred stock and substantial cash, the company’s enterprise value is around negative $1.5 million. The company has NCAV of $0.35 . . .
→ Read More: International Lottery & Totalizator Systems: A Captured Audience (ITSI)
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