Meet Value Investor Norman Rothery
Latest Columns
Monday, May. 20, 2013 7:00PM EDT
Trying to catch a falling stock: Six to watch
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Perusing the list of stocks hitting their 52-week lows inspires a little ditty called Down, Down, To Goblin Town to play in my head. It’s the victory song of a horde of goblins in the 1977 animated version of The Hobbit, and they sing it while dragging the heroes down into the bowels of their dark lair. It neatly captures the dangers investors face when buying falling stocks.
More »Monday, May. 13, 2013 8:30PM EDT
As rally pushes prices higher, time to buy -- or save?
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
The stock markets are shooting skyward and bond prices remain lofty. It’s enough to put investors in a cheery mood as we approach the summer holidays.
But, with prices so high, I’m starting to wonder if saving might be for suckers.
More »Friday, May. 03, 2013 7:31PM EDT
Buffett's stock may no longer wow, but his strategy does
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
As Warren Buffett takes the stage this weekend, it’s time to ask if his flagship company is still worth investing in.
The annual meeting of Berkshire Hathaway Inc. has been called a carnival of capitalism. It draws thousands to Mr. Buffett’s home town of Omaha, Neb., providing the perfect opportunity to reflect on the great investor’s philosophy and where his empire stands now.
More »Thursday, Apr. 25, 2013 7:02PM EDT
Want to beat the pros and thrash the market index? Hire a robotic monkey
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Some index investors have suggested that expensive portfolio managers could easily be replaced by monkeys willing to work for bananas.
Now a recent study goes even further. It suggests that a chimp can outperform not just the typical money manager but the traditional index fund as well.
More »Friday, Apr. 19, 2013 7:23PM EDT
Cisco provides investors with a lesson in patience
Norman Rothery
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
We’re fast approaching that special time of year when we celebrate the silly things our government spends money on by donating to the cause.
Yes, it’s tax time again.
More »Sunday, Apr. 14, 2013 8:45PM EDT
Prem Watsa counsels cash as markets continue their climb
NORMAN ROTHERY
Most investors know about the carnival of capitalism that revolves around Berkshire Hathaway’s annual meeting. Thousands of investors flock to see Warren Buffett each year and they effectively take over Omaha for several days in the process. The event is so popular that local businesses raise their prices in anticipation of squeezing an extra nickel or two out of the wealthy visitors.
More »Friday, Apr. 05, 2013 6:40PM EDT
Jolt from the blue: Francis Chou's candid letter to fund investors
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Waking to the smell of freshly brewed coffee gives a little perk to the day. But as I was enjoying my first cup, I found something more stimulating: Francis Chou’s annual letter to investors.
More »Thursday, Mar. 28, 2013 2:19PM EDT
Don’t undervalue the power of investor checklists
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Complexity has a nasty habit of obscuring rather than illuminating. It is particularly problematic for investors because they are faced with a sea of complications.
More »Thursday, Mar. 14, 2013 8:07PM EDT
The search for balance: A long-term view to soothe frazzled investors
Norman Rothery
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Warren Buffett thinks novice investors should start with index investing and for good reason. It’s a great option for all sorts of investors when done right with a balanced selection of low-fee funds.
More »Friday, Mar. 08, 2013 7:13PM EST
Why 'quality' stocks can drag down your portfolio
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Value investors have it easy.
Sure, they hold stocks other investors fear and loathe, but it’s relatively easy for them to find such unloved dogs. They just have to look for shares that are cheap in comparison to sales, earnings and other standard yardsticks. Over the years, many of these simple approaches to buying value have managed to beat the market.
More »Tuesday, Mar. 05, 2013 8:25PM EST
Big U.S. banks on 3-for-1 sale: Buy now
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Two-for-one sales can inspire mixed feelings in the aisles of the grocery store. While I love big discounts, I have a hard time accommodating an extra bag of potato chips. But I never get my fill of bargain stocks and the market is now offering a rare three-for-one deal on U.S. bank stocks.
| Company | Ticker |
Recent Price $ |
P/TB | P/E | Yield (%) |
|---|---|---|---|---|---|
| U.S. | |||||
| Citigroup | C-N | 42.16 | 0.81 | 16.6 | 0.1 |
| Bank of America | BAC-N | 11.3 | 0.85 | 44.5 | 0.36 |
Source: S&P Capital IQ
More »Friday, Feb. 22, 2013 7:30PM EST
The magic formula for investing? Put cheapness first
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Investors love to buy quality stocks at great prices. It’s a combination that might be better than chocolate and peanut butter.
Warren Buffett loads up on such stocks, and has become one of the richest people in the world as a result. Problem is, very few investors can spot quality businesses at reasonable prices quite as well as Mr. Buffett. So, instead of trying to weigh the intangibles as he does, many of us scrutinize the numbers.
More »Friday, Feb. 08, 2013 7:25PM EST
Glacier Media: A media stock that's worth buying. Really
Norman Rothery
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Value investors are thrifty folk who have a natural affinity for like-minded people. They detest CEOs who live it up on the backs of shareholders.
One way to double-check the frugality of top managers, beyond simply summing up their pay, is to examine the office space they work in. If it’s stuffed to the gills with expensive art and furnishings, think twice about investing in the company.
More »Thursday, Jan. 31, 2013 7:46PM EST
How much does that indexed portfolio cost? More than you may realize
Norman Rothery
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Indexing has taken the investment world by storm – and for good reason. For independent investors, it’s an excellent way to achieve instant diversification at rock-bottom cost.
More »Sunday, Jan. 13, 2013 7:00PM EST
Why Apple investors should remember Nortel
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
If history is any guide, Apple Inc. is too big to be a good investment.
If you doubt that, consider the rise and fall of Canada’s very own Nortel Networks Corp.
At its highs, Nortel represented more than 40 per cent of the S&P/TSX 60 index. Its fall from grace was unusually severe.
More »Wednesday, Jan. 02, 2013 7:47PM EST
What we can predict with certainty: the uncertainty of market returns
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
The dawn of a new year gives birth to a plethora of predictions. Stock market prognostications are entertaining, but they should taken with a big grain of salt.
To see why, I begin with a moderately optimistic forecast for the S&P 500 which calls for 6-per-cent gains in 2013 after adjusting for inflation and including dividends. Six per cent happens to be a little below the index’s average annual real return of 8.2 per cent since 1871 based on data from Professor Robert Shiller.
More »Tuesday, Jan. 01, 2013 6:30PM EST
Advice to the lazy investor: Be even lazier
NORMAN ROTHERY
Some people have given up on buy-and-hold investing. After two big crashes in just over a decade, holding individual stocks for long periods strikes some investors as downright preposterous.
Nonetheless, it remains Warren Buffett’s favourite method. He points out that “lethargy bordering on sloth remains the cornerstone of our investment style.”
More »Sunday, Dec. 30, 2012 7:00PM EST
Scary beats safe in realm of cheap stocks
NORMAN ROTHERY
Cheap and safe are two attributes I look for when picking stocks. But seeking safety doesn’t always pay. History suggests that a cheap-and-scary approach may be the better way to go – if you have the stomach for it.
Tobias Carlisle, a U.S. money manager, is putting this theory to the test by conducting a friendly race among different portfolios of value stocks. The race focuses on deep-value stocks in a segment of the market where many investors fear to tread.
More »Sunday, Dec. 16, 2012 7:00PM EST
Small, illiquid stocks offer best value
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Far too many investors look for big, popular, and liquid stocks. They fawn over large firms with excellent prospects that are easy to trade. Problem is, loved stocks often come with big price tags and that can to lead to disappointing returns.
More »Sunday, Dec. 09, 2012 6:41PM EST
Why smart stock investors use only the numbers to make money
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
A huge pile of research points to an array of simple numerical stock strategies that boosts returns over the long term. Such methods range from low-ratio value strategies to momentum-oriented schemes.
More »Tuesday, Nov. 27, 2012 7:55PM EST
What value is good value for stocks? Price-to-book history can help you decide
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Next time you’re in the bathtub, consider the dynamics of the rubber duck – an easy-to-submerge toy that quickly pops to the surface when it is released.
In much the same way, value investors buy stocks that the market has pushed deep underwater because they expect these firms to turn around and head back to more normal levels.
| Company | Ticker | Price (Nov. 23, 2012) | P/B | P/B Range % |
|---|---|---|---|---|
| Imperial Oil | IMO-T | $43.45 | 2.35 | 0 |
| Cameco | CCO-T | $17.49 | 1.41 | 1 |
| Research In Motion | RIM-T | $11.61 | 0.65 | 2 |
Data Source: S&P Capital IQ, P/B range is based on the period since the start of 2006 except when noted with an asterisk, where shorter periods were used.
More »Wednesday, Nov. 21, 2012 5:55PM EST
Want bargain stocks? How to sculpt a value portfolio
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Most stock pickers dive into the markets with a clear goal in mind. They want to find the stocks that have the very best qualities so they can make a fortune. Such searches often lead to the extremes of the market. Value investors seek stocks trading at extremely low earnings multiples. Growth investors hunt for firms with extraordinary histories of expanding revenues.
| Company | Ticker |
Price $ (Nov. 16) |
P/E | P/TBV |
Dividend Yield |
|---|---|---|---|---|---|
| Airboss of America | BOS-T | 4.39 | 17.7 | 1.42 | 4.7 |
| Algoma Central | ALC-T | 118.9 | 9.2 | 1.01 | 2 |
| CCL Industries | CCL.B-T | 37.07 | 13.1 | 2.58 | 2.1 |
Source: Norman Rothery; S&P Capital IQ
More »Wednesday, Nov. 14, 2012 7:39PM EST
How to find value investments in an overvalued market
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Stock markets have been lurching downward since the re-election of U.S. President Barack Obama. Should you consider that a signal to trim your stock holdings?
The answer may depend on what type of investor you are. By at least one important yardstick, the market is overvalued and likely to produce lacklustre returns. But value investors have a better chance than most to produce respectable results.
More »Sunday, Nov. 11, 2012 7:00PM EST
The strict -- and not-so-strict -- rules of smart investors
NORMAN ROTHERY
I’m a big fan of Benjamin Graham’s investment techniques and frequently use strategies from the father of value investing to uncover interesting Canadian stocks.
With markets looking a bit shaky in recent days, it’s an opportune time to focus on Mr. Graham’s defensive approach, which I’ve used profitably for over a decade.
More »Thursday, Nov. 01, 2012 8:05PM EDT
Stocks are overpriced: Lessons from baseball
NORMAN ROTHERY
Norman Rothery is the value investor for Globe Investor’s Strategy Lab. Follow his contributions here and view his model portfolio here.
Is the stock market overpriced? According to two ways of looking at share prices, the answer is yes.
One approach, advocated by investing author Rick Ferri, measures the stock market in terms of its current price versus the peak earnings it has achieved in the past.
More »Welcome to Strategy Lab
Stock market ideas, investing insights (and competition): Watch and participate as four of Canada’s brightest investors go head to head in a battle for portfolio supremacy. Whether you’re a dividend collector, a value hunter, a growth junkie or an indexing enthusiast, you’ll find inspiration for your own investing.
About Norman Rothery
Norman Rothery
Norman Rothery, Ph.D., CFA, is the founder of StingyInvestor.com and has been catering to value investors since 1995. He publishes the Rothery Report, a value stock newsletter, that recently celebrated its 11th anniversary.
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