MarketWatch Interview with Larry Coats

MarketWatch had an interview with Oak Value Fund's manager Larry Coats on Aug. 14, 2007. Larry Coats says the recent market selloff underscores the importance of investing in companies with strong balance sheets. He also talks about three financial companies trading at a discount.

Here is video link - Oak Fund : Three Financial Value Plays.
Or you can watch directly below.

• Related Links :
• Interview with Larry Coats, Oak Value Fund (Video)
  
• Oak Value Fund 2007 Q2 Investment Adviser's Review
  

Bloomberg Interview with David Dreman

Bloomberg had an interview with David Dreman, CIO of Dreman Value Management LLC, on Aug. 13, 2007. The U.S. stock market is "pretty solid'' and offers "great opportunities,'' says value investor David Dreman.

I highlight some insightful points below:

• The market is pretty solid and fundamentals are good. Earnings are good and it's not overpriced. The economy is picking up.
• The major investment bankers are cheap. Will they go cheaper? I think so. If things turn around they could shoot up pretty quickly.
• We've always liked crises, not for our clients, but because it gives you some great opportunities.
  

Here is video link or you can watch directly below.

Bill Nygren's Q&A at GuruFocus.com

Bill Nygren, portfolio manager of Oakmark Fund and Oakmark Select Fund, recently had a great Q&A session at GuruFocus.

I highlight some insightful points below:

• Buy Criteria
1. it sells it a large discount to our value estimate,
2. we believe the value growth will be at least average, and
3. we believe management will act like owners.
   
• Sell Criteria
• We sell when we lose any of those three supports.
  
• Failures are when we lose confidence in management or the ability to grow.
  
• Successes are sold when the value gap has become deminimis, or other stocks have fallen such that they are far more attractive than those we hold.
• 4 exceptions of selling at 90% of estimated intrinsic value
• We sell at less than 90% of value if we lose confidence in either the management or the ability of the business to grow. Effectively, those are sales of our mistakes.
• We sell at less than 90% of value if the business needs to be owned by someone else to maximize value (generally meaning acquisition synergy) and there is no reason to believe such a change in ownership is imminent.
• We will sell at less than 90% of value if non-owned stocks are available at less than 60% of value. The relative gap of 40-50% appreciation is what we are really trying to capture.
• We will wait for a holding to go long term if it is selling at around 90%-110% of our value estimate. If it increases past that, we’ll accept the short term tax penalty to avoid the risk of holding a significantly overvalued security.
• Important Traits
• To me, the most important traits are a combination of passion and discipline.
• Being able to stick to one’s investment philosophy through tough times is perhaps most important.
• Indeed, if it is thought of as a “job” that already makes success difficult. Successful investors have a passion for the challenge of investing, and to them, it is their way of life, not just a job.
• To be a value based consumer, and to have the confidence to rely on my own judgment even when the crowd came to a different conclusion.
  
• Investment Mistakes & Lessons
• Over the next twenty years, KM went bankrupt and Wal-Mart returned many times its cost. That mistake taught me a lot about sustainable competitive advantage, and the importance of corporate cultures. That was the start for me of realizing that qualitative analysis was as important as quantitative analysis.
• Sometimes value investors buy a stock to capture a valuation gap, but don’t adjust their valuation targets based on information that comes out after they purchase it.
  
• Investment Process
  
• I believe the most critical part of value investing is following a disciplined buy and sell process. If that is a given, then yes, finding new ideas is the next most important thing.
• We try to identify change that might make them qualify: for those that looked too expensive, we look for large stock price declines.
  
• Second largest source is probably management change.
  
• Statistical cheapness was a starting point, not an ending point.
  
• Value Investing
• To me, value investing is a way of making sense of the world, not just investing.
• Outlook
• We’ve seen small stocks outperform for about 7 years, and for 4 years we’ve seen commodity and cyclicals outperform stable growth, low quality outperform high quality, and International outperform US. Looking for values today, I would look away from those categories that have done well recently.
  

Full Q&A - Gurus On Board: Ask Bill Nygren - The Answers.

Biweekly Reading List (7/29-8/11)

I recap some good articles I read in the past two weeks :

• Warren Buffett
• Making Money the Warren Buffett Way
• Warren Buffett Bought 1.6 Million More Shares of Burlington Northern Santa Fe Corp.
• Reverse Engineering of Warren Buffett’s December 1999 Investment in First Industrial Realty Trust
• Bill Miller
• Bill Miller 2007 Q2 Commentary
  
• Bruce Berkowitz
• Bruce Berkowitz Talk at WealthTrack
• Fairholme Fund 2007 Semi-Annual Report
• Mohnish Pabrai
• Morningstart Interview with Mohnish Pabrai (Unabridged Video)
• Whitney Tilson
• TheStreet.com TV Interview with Whitney Tilson
• Off Year for Berkshire Doesn't Cow Buffett Buff
• Leon Cooperman
• Leon Cooperman's Article in Fortune magazine
• Mark Sellers
• Tend to overanalyse stocks? Bring out the dart-wielding monkey
• David Einhorn
• David Einhorn's analysis of St Joe's At Stocks Below NCAV
• Zeke Ashton
• How concentrated should you be? (2007 Value Investing Congress Presentation)
• Jim Rogers
• Bloomberg interview with Jim Rogers
• Other Value Managers
• Value Investing Conference at The Ben Graham Centre (Videos)
• TMF Interview with Sardar Biglari
• Dodge & Cox Stock Fund 2007 Semi-Annual Report
  
• Piggyback Investing
• Stockpicking: Follow That Guru
  

Bill Miller's 2007 Q2 Commentary

Bill Miller, Chairman and CIO of Legg Mason Capital Management Inc., released his commentary on July 30, 2007.

I highlight some interesting points below:

• Housing Stocks
  
• Usually, but not always, when you read about some industry or company having the worst time since some period of years, or even decades ago, you will find that buying that industry or company when it was going through those difficulties proved quite profitable if your time horizon wasn’t measured in days or months.
• The headlines today are all about this being the worst housing market since the early 1990’s. Had you bought housing stocks during that previous period of duress, you would have made many times your money and handily outperformed the market over the subsequent decade.
• If we did not own housing or housing-related stocks (such as Countrywide Financial), we would be buying them now, amid the panic selling currently underway.
• Energy and energy-related stocks
• It is said the only thing worse than being wrong is staying wrong.
• We are at or near the high prices for oil that were reached last summer.
• If oil retreats from these or modestly higher levels over the next six months, it is likely that we are nearing the end of a long cycle. If it breaks out to new highs and stays there, then the secular story may carry the day.
• Speculative interest in oil futures on the commodities exchanges is at record levels, while oil companies and others in the industry are net short the commodity, believing the price will decline.
  
• Market Outlook
• I am constantly asked for my market outlook, so I will give one, not because I know but because I am asked.
• In the intermediate or long run, stock returns depend on valuation relative to fundamentals such as growth rates and return on capital.
• According to data compiled by Bloomberg, stocks are now the cheapest they have been in 16 years. The S&P 500 is valued at 15.4x estimated earnings, the lowest since January 1991. Again, a pretty good time to be a buyer of stocks!
  

Direct Link (PDF) - Bill Miller's 2007 Q2 Legg Mason Value Trust Investment Commentary.

Leon Cooperman's Article in Fortune magazine

Leon Cooperman is founder and chairman of Omega Advisors, a hedge fund with $6 billion in assets. Cooperman explains in Fortune magazine why stocks are on track for solid gains - despite the market's sudden selloff.

I highlight some insightful points below:

• Outlook
  
• I do not believe recent credit-market turmoil will derail the economy - I view this market drop as a long overdue correction rather than the end of the bull market.
• I believe there's limited downside risk in the U.S. stock market from current levels, and returns over the coming year should be in the low double digits.
• Economic growth for 2007 : 2% to 3%
• Inflation for 2007 : 2%
• Fed policy : No change
• P/E ratio of the S&P 500 : 15
• Job growth : 145,000 a month
• The equity market is unlikely to fall sharply from current levels because :
  
• First, bull markets do not die of old age, they die of excesses such as accelerating and above-trend economic growth, rapidly rising inflation, and interest-rate hikes from a hostile Federal Reserve. Those excesses are simply not with us today, nor do I expect their arrival anytime soon.
  
• Second, the current bull market has experienced no price/earnings ratio expansion -- unlike every other bull market in the past five decades. In effect, this bull market is not characterized by speculation; rather, its expansion has been restrained compared with earnings growth and the trend of inflation and bond interest rates.
• His Picks
• Bank of America.
• Atlas America.
  

Article Direct Link - Leon Cooperman: Why I'm a bull.

Disclosure : I don't have any of these equities listed above.

TheStreet.com TV Interview with Whitney Tilson

Whitney Tilson was in an Aug. 7 interview on TheStreet.com TV. Tilson, portfolio manager for the Tilson Focus fund, breaks down Berkshire Hathaway's earnings as well as Bill Ackman's activist play in Target. He conservatively places fair value for Berkshire around $150,000 a share.

Video Direct Link - Berkshire's Quarter Just Plain Beautiful.
Article Direct Link - Off Year for Berkshire Doesn't Cow Buffett Buff.

Disclosure : I don't have any of these equities listed above.

TMF Interview with Sardar Biglari

Emil Lee at The Motley Fool had an email interview with Sardar Biglari, chairman of Western Sizzlin and manager of The Lion Fund.

I highlight some points below:

• I focus intensely on evaluating an array of situations, searching for pockets of opportunity that are within my sphere of competence.
• Capital allocation is a matter of discovering where we can generate the highest return, adjusted for relevant risks.
• Some firms will be growing, whereas others will not. However, the key is not growth but valuation.
• GULP (Growth at an Unreasonably Low Price) investing could obtain truly outsized returns.
  
• What is rather important, and is quantifiable, is the business's competitive advantage, which is computed by taking return on capital and subtracting cost of capital.

Article Direct Link - Sizzlin' With Sardar Biglari.

Bruce Berkowitz Talk at WealthTrack

Bruce Berkowitz, founder and co-manager of Fairholme Fund, talked at Consuelo Mack WealthTrack on Aug. 3, 2007. Berkowitz discussed why a handful of stocks and a pocketful of cash has enabled his fund to far outdistance the market in all kinds of weather.

I highlight some interesting points below:

• Q: What's your view on the US Stock Market ? Berkowitz: I have no idea !
• The future is so unpredictable. We assume the worst. We assume bad things can happen do happen. We try consistently to be ready for that.
• Cash as Strategic Asset.
  
• Trying-to-kill-the-company approach.
  
• “The One Investment…” - Canadian Natural Resources (CNQ)
  

You can watch the video at WealthTrack or download it from Google Video.

*You can also read Fairholme Fund 2007 Semi-Annual Report and watch CNBC Interview with Burce Berkowitz on June.

Bloomberg interview with Jim Rogers

Bloomberg interview with Jim Rogers, chairman of Beeland Interests Inc., on Aug. 3, 2007. Jim talked about his new book, the commodities, China market, and U.S. subprime-market etc.

Here is video link or you can watch directly below. (about 13 minutes)

Morningstart Interview with Mohnish Pabrai (Unabridged Video)

Morningstar Justin Fuller chat with Dhandho Investor author Mohnish Pabrai on July 27 2007. This is a full version of the interview (about 34 minutes). You can also watch the shorter version (about 10 minutes) - Morningstart Interview with Mohnish Pabrai (Video).

Here is video link or you can watch directly below.

Value Investing Conference at The Ben Graham Centre (Videos)

The Ben Graham Centre for Value Investing released great videos of May 25th, 2007 Conference on Intelligent Investing.

The conference featured Mr. Prem Watsa, Chairman & CEO of Fairfax Financial as the keynote speaker. Other speakers included Dr. George Athanassakos of the Richard Ivey School of Business, Dr. John Bart, Founder of Canadian ShareOwner, Mr. Howard Atkinson, President of Horizons BetaPro ETFs and Mr. Rob Arnott, Chairman of Research Affiliates, LLC.

• George Athanassakos - Value vs. Growth Stock Returns and the Value Premium in Canada between 1985 and 2002.
• John Bart - Growth Investing – What to Buy? When to Sell? It is Easiest with Growth Stocks.
• Prem Watsa - Ben Graham and Bubbles.
• Howard Atkinson - Capitalization Weighted Indexing – A Performance Headwind?
  

Video Link.

Source: BRKNEWS