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Evaluating Management Decisions for Investor Success
This chapter explores the pivotal role of management decisions in influencing shareholder value, supported by case studies and investment strategies. It emphasizes the need for investors to scrutinize management actions and concrete financial metrics, alongside assessing market dynamics and return on capital to make informed investment choices.
In today’s episode, Shawn O’Malley (@Shawn_OMalley_) takes you into the classroom of legendary investor Joel Greenblatt, sharing his biggest takeaways from watching Greenblatt’s lectures at Columbia. Greenblatt is a wildly successful investor, professor, founder of the Value Investor’s Club forum, and best-selling author of some of the most popular stock investing books ever written.
You’ll learn how Greenblatt thinks about the upside and downside potential for investments through three case studies, how Joel Greenblatt derived his Magic Formula for investing, why buying cheap stocks still works even though the strategy is well-known, where to look for the rarest but most attractive types of stock investments, what was Joel Greenblatt’s biggest investing mistake, plus so much more!
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IN THIS EPISODE, YOU’LL LEARN
00:00 - Intro
02:34 - How to think through stock investments via case studies on the best pitches ever submitted to the Value Investor’s Club forum
03:02 - How Joel Greenblatt derived the Magic Formula for investing
05:12 - Which investments are the rarest but most attractive
07:34 - Why it’s important to condense an investment thesis down to just a few sentences
11:52 - How bankruptcy restructurings can actually generate undervalued and overlooked stocks
19:02 - Why so many great investors get their start with microcap stocks and special situations
30:16 - Why value investing still works and has worked across time
41:29 - How Joel Greenblatt made his biggest investing mistake
And much, much more!
*Disclaimer: Slight timestamp discrepancies may occur due to podcast platform differences.
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Listen to the best highlights from the podcasts you love and dive into the full episode