A few weeks back, I sent an e-mail to our advisers talking about the "no-brainer" type investments we are looking for. I wrote a nice, long e-mail (in true Joe fashion) about discounted cash flow and valuing businesses, about speculation versus investing - it was practically a novel in and of itself. Then, I deleted the whole thing, and started from scratch.

The way I figured it, you shouldn't have to be a rocket scientist to understand "no-brainer" investing. Here's a recap of what I wrote:

Continue Reading What is a No-Brainer investment? ››

I don't want to focus this blog solely on workout situations; still, I think a majority of visitors never even dreamed of finding workouts until we walked through the various steps, the timeline, and the potential profits and risks. So, let's add another chapter to the workouts/arbitrage discussion. Question: Should you consider buying workouts before regulatory approval goes through — when the potential profits are greater?

Continue Reading Pre-Regulatory Workouts ››

I want to invest like Warren Buffett. Who doesn't? To understand how he invests, I have purchased and read every book ever written on the man. A good starting point. The problem is that they all talk about the same few investments (e.g., Coca-Cola, American Express, GEICO). The no-brainer type investments. What else has he dabbled in?

See for yourself with the EDGAR database.

Continue Reading The EDGAR Database: Watching Warren ››

For seven months now, I've been talking about "going straight to the source" to find information and financial statements to analyze companies. Websites like Morningstar are great starting points and usually have accurate financial information; still, nothing beats reading quarterly and annual reports, proxy statements, and contracts as they were filed with the US Securities and Exchange Commission.

Of course, those discussions were based on the premise that everyone is familiar with the EDGAR database. For those that are not, let me introduce you to EDGAR.

Continue Reading The EDGAR Database: A Primer ››

While I respect everyone's opinion, the overwhelming majority said they would rather see an update and some ads. I don't think the web designer went overboard at all. I've decided against a donate button simply because I would feel bad accepting donations from my friends on this site.

The Workout forum and Resources section should be up over the next week or so. In the meantime, take a look around and let me know your thoughts.

EDIT: What happened to the recent comments? We opted for an RSS feed for the comments because they were coming in too fast and many were getting lost. The feed is located here and can also be accessed with the navigation bar on the left.

Thanks to everyone who provided feedback both on the site and via e-mail.

There had been a considerable amount of discussion about the acquisition of Penn National Gaming, both in these comments and in a few other comments around the site. As the deal stands right now, Wall Street appears to be leaving $18 a share — or 38% — on the table for today's workout investors.

What will upset the applecart?

Continue Reading Penn National Gaming — Workout or Worthless? ››

Ask and you shall receive. My web designer got back to me regarding some ideas that have been posted here for forums, discussion boards, etc. He also gave me a price and, well, ouch.

Here's where we are at.

Continue Reading The Workout Forum; Site Changes ››

I just finished going on a comment-spree and I thought I should update you on a few other things as well. First, I sold my RTSX today. When engaging in workouts (as with any other investment), I am looking for both safety of principal and a satisfactory return (thanks, Ben Graham, for the definition of an investment).

As you know, I may use leverage on my workout positions or as an offset if I need to buy a business and I am fully invested. The danger in using leverage is that you can quickly rack up the losses. Here's why I sold:

Continue Reading Sold My RTSX; Workout Timeline ››

A common question among investors — both conventional and non-conventional — is: How should I allocate my portfolio so I am best prepared to capitalize on (or protect myself from) the coming years in the markets? Mutual fund, which were designed to, in part, shield people from volatility, aren't living up to their promises and even "well-diversified, long-term" mutual fund investors are finding it difficult to "stay the course" like their advisers instructed.

Here's how to do it.

Continue Reading What Is The Best Asset Allocation Strategy? ››

In Workouts Work Out In Down Markets — Part 3, I discussed another workout opportunity in the acquisition of Radiation Therapy Services (RTSX) by Vestar Capital Partners in a going-private transaction. The deal was pending shareholder approval and customary closing conditions. Since that post on January 21, 2008, the price fluctuated quite considerably and shook the nerves of a lot of holders.

This is a prime example of why you should use price as a tool, not a guide.

Continue Reading Use Price As A Tool, Not A Guide ››

How much is today's gut-wrenching, hair-raising volatility worth? Let me ask a different way: After 40 years of investing in markets like these, how much more money would you expect to have versus investing in bonds and ignoring the markets altogether? $500,000? $1 million? $10 million? What if I told you the difference was just $40,000?

Is all this crazy volatility, nail-biting terror, and self-doubt for forty years worth just $40 grand or less?

Continue Reading Stocks Stink. Buy Bonds! ››

Ever since I posted the analysis on Adobe yesterday, I've had this looming feeling that a little clarification was in order. Some of you are looking for reinforcement on your long-term, buy-and-ignore portfolio; some are really trying to find those heart-pounding, mouth-watering, back-up-the-truck deals in the markets.

At today's prices, I believe that Adobe is appropriate for the former — it is a great company that appears to be selling at a moderate discount. Allow me to explain:

Continue Reading Before You Back Up The Truck On Adobe ››

On Wall Street, growth and value are anything but joined at the hip. Stocks are typically split into two groups: growth and value. When a growth stock gets hammered down, it becomes a "real bargain" growth stock; when a value stock drops in price, it is a "better value" at the lower price.

So, is Adobe a real bargain, a better value, or a pass?

Continue Reading Owning a Slice of Adobe's Toll Bridge ››