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Accounting aggressive, 2–6, 16, 18, 42–43
as catalyst, 31
changes, 83–85
investors and, 84
issues, 32
management using, 83–85
percentage-of-completion, 42–50
principles, 84
trouble, 31
Accounts payable, cash flow improved by, 129
Accounts receivable
of Akamai Technologies, 116–117
allowance for doubtful accounts and, 85–89
cash flow boosted by, 129
DSO and, 247
of Jacobs Engineering, 148
tangible book value influenced by, 101–102
Accumulation/distribution rating, 207–208
Acquisitions, 85
Cisco Systems making, 162, 163
companies making, 161
EBITDA and, 145
free cash flow influenced by, 161
HP, made by, 114
management and, 161
shareholder value added by, 191
taxes preventing, 113
value added by, 192
working capital influenced by, 135
Active managers, 249, 252, 265n4
Activist firms, 188–189
Aeropostale, 106–108
Age, 11
Aggressive accounting, 2–6, 16, 18, 42–43
Aggressive revenue recognition. See Revenue recognition
Akamai Technologies, 115–122
Allowance for doubtful accounts, 85–89
Ambac, 26–28
America Online (AOL), 31–32, 93–94, 259n26
Angry Birds, 25
Angstrom caps, 191
AOL. See America Online
Apple, OCF margin of, 139, 140
Artusi, Dan, 64
AsiaInfo Holdings, Inc., 43–50
Assets. See also Tangible book value
capitalizing, 92–94
companies writing down, 91
discounts and, 178–179
as earnings quality indicators, 85–94
fixed, 85
liabilities’ relationship to, 83
management inflating, 89–90
other current, 92
shareholder equity’s relationship to, 83
Bankruptcy, 191–192
Baruch, Bernard, 186
Bear markets, 14, 165, 220–224, 257n11
Behavioral finance, 176–177
Behind the Numbers , 112–115
Berkshire Hathaway, 125, 175, 178
Biggs, Barton, 15
Bill-and-hold revenue, 53–54
Black Swan, 197
Blackstar Funds, 9–10
Brennan, Russ, 64
Browne, Tweedy, 16, 173, 176, 177, 178, 186, 189
Buffett, Warren, 16, 125, 154, 256n7
on Berkshire Hathaway, 179
on gains, 229
Graham and, 175
on money, 179
rule of, 188
speech of, 176
on stock price, 175
Business model, failure of, 20–21, 26–29
Businesses. See Companies
Capital expenditures (capex), 120, 156–159, 161
Capitalizing, 92–94
Cash
companies needing, 112
conversion cycle, 129
EPS, 152–154
from financing, 165–169
of Google, 114
of Merck, 114
of Motorola, 113–114
from operations, 124
repatriated, 112–113
at Steak ’n Shake, 159–160
taxes on, 111–112
U.S. and, 112–113
Cash conversion cycle (CCC), 129, 151
Cash flow, 114, 124–125, 126, 129, 150–151. See also Free cash flow; Operating cash flow
Cash flow statement, 36, 123, 124, 169
Catalysts, 20
accounting trouble as, 31
as attributes, 191–192
short sellers influenced by, 26
stocks, working with, 180
CCC. See Cash conversion cycle
CDOs. See Collateralized debt obligations
CGM Focus Fund, 10, 14, 219–220
Changes in assets and liabilities. See Changes in working capital
Changes in working capital, 128–135
Charges
companies and, 91, 95, 109, 110
EPS influenced by, 109
inventory, 77–79
investors influenced by, 109
reserves indicated by, 95
revenue influenced by, 55
Wall Street influenced by, 109
Chipotle Mexican Grill, 201
Ciena, 207
Cisco Systems, 78-79, 113, 162, 163
Coach (luxury accessory maker), 55
Coca-Cola risks, 115
COGS. See Cost of goods sold
Collateralized debt obligations (CDOs), 27
Commodities, stock as, 200
Communication from companies, 22-23
Companies
acquisitions made by, 161
assets written down by, 91
bankruptcy and, 190-191
in bear market, 165
in bull market, 165
cash needed by, 112
communication from, 22-23
costs controlled by, 105
as damaged goods, 191—192
with debt, 98-99
deferred revenue of, 51—52
distributors purchased by, 55
dividends, weighted based on, 250
doubtful accounts and, 86
drilling rig, 190
earnings quality of, 146, 148, 173-174
financial, 98-99
highly acquisitive, 161-164
inventory buildup influencing, 76-77
inventory components reported by, 66
inventory sold by, impaired, 77-78
inventory written off by, 78-79
investors influenced by, 84, 109, 246
long side, considered for, 173-174
market influencing, 190
PP&E sold by, 156
price discounted by, 39
price-to-sales ratio valuing, 244
reserves disclosed by, 86
sales manipulated by, 245
SEC filings of, 23
shorting, 165
Silicon Valley, 165-169
software, 93
stock contrasted with, 204-205
stock repurchased by, 187-188
taxes and, 111-115
tangible bank value of, 179
tech, 70-71, 126, 161-164, 247-248
U.S., 111-112
Wall Street’s expectations of, 38-39, 52
working capital managed by, 128-135
Computer Associates, 54
Confirmation bias, 174, 210, 219-220
Cost of goods sold (COGS), inventory determining, 77
Costs
average, 16-17, 79, 80, 215, 216
capitalizing, 92-94
companies controlling, 105
fixed, 76
gross profit influenced by, 105
inventory, 80-82
inventory input, 105
management controlling, 105
stepped-up, 80-81
Crash of 1929, Graham almost finished by, 194
D&A. See Depreciation and amortization Dairy Queen, 125
Days in deferred revenue (DDR), 94-95
Days sales in inventory (DSI), 63-67
Days sales outstanding (DSO), 29, 40-42, 259n2
accounts receivable and, 247
chicanery, 247-248
description of, 37-38
increase in, 39
of Jacobs Engineering, 148
price-to-sales ratio and, 248-249
revenue recognition influenced by, 37-38
revenue recognition pointed to by, 247
Wall Street and, 38
Days to cover, 31
DDR. See Days in deferred revenue De Bondt, Werner F.M., 190
Deferred revenue, 51–52, 94, 95
Del Vecchio Earnings Quality Index, 25–251, 252
Depreciation and amortization (D&A), 84–85, 124–125, 158
Digital River, 153–154
Discounts, 179–180
Distributors, 55
Dividends, 99–100, 167–169, 250, 256n6
DJIA. See Dow Jones Industrial Average Dodd, David, 13, 175
Dollar-cost averaging, 11, 13–14, 16–17
Dow Jones Industrial Average (DJIA), 221–222, 223
Drawdowns, 219–220, 225, 226, 227, 228, 235, 252–253
DSI. See Days sales in inventory
DSO. See Days sales outstanding
Earl, Ralph Waldo, 193–194
Earnings, 3, 86–89, 91, 183–187
Earnings before interest, taxes, depreciation, and amortization (EBITDA), 143–146, 150–151, 183–185
Earnings per share (EPS)
of Akamai Technologies, 117–118
cash, 152–154
charges influencing, 109
D&A period influencing, 84–85
media focusing on, 3
reserves boosting, 78, 95–96, 97
Earnings quality
aggressive accounting lowering, 4
analysis, 174
assets as indicators of, 85–94
description of, 3
doubtful accounts pointing to, 87
income statement, concerns of, 36
liabilities as indicators of, 94–101
revenue recognition and, 36
SG&A expenses indicating, 109
EBITDA. See Earnings before interest, taxes, depreciation, and amortization
EBIX, 202
EDS. See Electronic Data Systems
Efficient market theory (EMT), 176–177, 251–252
Electronic Data Systems (EDS), 114
EMT. See Efficient market theory Enron, 25–26
Ensco, 190
Enterprise value (EV), 184–186
EPS. See Earnings per share eResearch Technology, 40–41
Esposito, Joseph, 41
EV. See Enterprise value
Fama-French three-factor model (FF3), 257n16
FASB. See Financial Accounting Standards Board
Fear, management influenced by, 97
FF3. See Fama-French three-factor model
FIFO. See First-in first-out
50-day moving average (50 DMA), 212–214, 230–233
Financial Accounting Standards Board (FASB), 37, 57, 83, 125–126
Financial statements, 36, 84–85, 123–124. See also Income statement
Financing, 164–169
Firmness of character, 13–14
First-in first-out (FIFO), 77
Fischer, Jeff, 259n26
Float, 31
401(k) plans, 14–15, 224–225, 257n13
Fox, Justin, 177
Free cash flow, 154
acquisitions influencing, 161
of Helen of Troy, 155–156, 157
investors using, 155
margin, 155
market capitalization to, 184
of Maxim Integrated Products, 138
at Steak ‘n Shake, 159–160
working capital and, 128
French, Kenneth, 15, 19, 257n16
GAAP. See Generally accepted accounting principles
Gambling, 192
General Electric (GE), risk of, 114
Generally accepted accounting principles (GAAP), 77
Gold, 182
Goodrich Corp., 91–92
Goodwill, 89–92
Google, 114
Government, 112
Graham, Benjamin, 13, 16, 256n7
Buffett and, 175
Crash of 1929 almost finishing, 195
description of, 175
earnings yield of, 184
on gains, 229
liquidation value calculated by, 179
strategies, 175
Green Mountain Coffee Roasters, 134–135, 210–211
Gross, Ron, 182
Growth
acquisitions masking, 162, 164
companies, 185
of companies, 250
investors, 100
investors seduced by, 247
revenue, 59–61
stocks, 244
Gulf of Mexico spill, 189
Helen of Troy, 41–42
free cash flow of, 155–156, 157
intangibles of, 101
non-monetary transactions of, 53–54
revenue growth of, 59–61
stock of, 60
Hewlett-Packard (HP), 109, 110, 114, 167–169
Hot Topic, 182
Houston, Paul, 185
HP. See Hewlett-Packard Human nature
changing, 253
dollar-cost averaging influenced by, 13–14
investors influenced by, 10, 21, 210
RIAs hamstrung by, 18
IBM. See International Business Machines
Ikenberry, David, 264n8
Income statement
earnings quality concerns of, 36
items special to, 105–111
management manipulating, 83
reserves and, 96
revenue as driver of, 36
Indexes
active managers failing to outperform, 249, 265n4
description of, 17
market-capitalization weighted, 249, 250
stocks, individual, as alternative to, 17
stocks of, 249–250
Inflation, 11, 12–13, 14, 100–101
Insurance, 26–28
The Intelligent Investor (Graham), 175, 184
InterDigital Communications, 55–57
Interest income, 54
International Business Machines (IBM), 44–46
Internet, 178
Inventory. See also Inventory components
on balance sheet, 66
buildup, 75–77
charges, 77–79
of Cisco Systems, 78–79
COGS determined by, 77
cost, 80–82
description of, 63
expansion of, 129
GAAP on, 77
impaired, 77–78
input costs, 105
investors and, 77
management overseeing production of, 66
prices, 70–71
reduction of, 129
selling written-off, 78–79
of Skechers, 181–182
step-up, 80–82
TBV influenced by, 101–102
valuation, 79–80
written off by companies, 78–79
Inventory components, 66–67, 69. See also Negative divergence; Positive divergence
Investing
attributes common to, 173, 177–192
as gambling, 192
process, 174
value, 174
Investors
accounting methods and, 84
acquisitions omitted by, 161, 162
aggressive accounting and, 16, 18
behavior of, 10
cash flow, knowledge of, 126
cash flow statement analyzed by, 169
charges influencing, 109
companies influencing, 84, 109, 246
confirmation bias influencing, 210, 219–220
cycles timed by, 228
D&A looked at by, 125
damaged goods perception influencing, 191–192
dividends and, 100
dollar-cost averaging used by, 13–14
with drawdowns, 220
expectations of, 247–248
financial statements looked at by, 124
free cash flow used by, 155
fundamental, 199
growth, 100
growth seducing, 247
human nature influencing, 10, 21, 210
individual, 224–225
Internet as worst enemy of, 178
inventory and, 77
long term, 200
media influencing, 214
money influencing, 178
mutual funds of, 200
nominal returns and, 11
patience of, 174
Priceline purchased by, 155
profit margins hypnotizing, 105
rational, 167
real returns and, 11
return maximized by, 230
revenue analyzed by, 35
risk maximized by, 230
stock charts studied by, 229
stock options and, 126
supply and demand and, 205
tax benefits reviewed by, 128
taxes reviewed by, 111
texts learned by, 177
trends and, 203–205
value, 16, 100, 144–145, 155, 173, 174, 175, 176–177, 179–181, 191, 194–195, 246
value influenced by, 174
Jacobs Engineering, 146, 148–151, 152–153
Jarden (consumer products company), 80–82
Jockeys, 189
Juniper Networks, 57–59, 213–214, 260n8
Kahneman, Daniel, 176–177
Keynes, John Maynard, 14
Knapp, Tom, 176
Kumar, Sanjay, 54
Lacey, John, 185
Land, agricultural, 181
Large caps, professionals restricted to, 19
Last twelve months (LTM), 139, 145–147, 150, 155
Last-in first-out (LIFO), 77, 78
Leases, sales-type, 54–55
Lefèvre, Edwin, 18
Legg Mason Value Trust, 215, 216
Lemonade stand, 184
LIFO. See Last-in first-out Lipman Electronic Engineering, 76–77, 262n4
Loewen Group, 185
Long book. See Long side Long-short percentages, 195–197
Long-short portfolio, 5
example regarding, 192–195
losses avoided by, 197
risk influenced by, 30
short side hedging, 183
uncertainties, helping with, 193–195
Long side
companies considered for, 173–174
odds and, 192
strategy for, 5, 15–16, 173, 194–195
Lost decade, 222
LTM. See Last twelve months
Lynch, Peter, 10
Maginot Line, 212–214
Management
accounting changes used by, 83–85
acquisitions and, 161
aggressive accounting of, 2–4, 42–43
assets inflated by, 89–90
balance sheet manipulated by, 83
chicanery of, 2
costs controlled by, 105
doubtful accounts manipulated by, 86–87
estimates of, 84–85
expectations, pressured to meet, 247–248
experience used by, 152
FASB leaving discretion with, 83
fear influencing, 97
fnancial statements manipulated by, 84–85, 123
goodwill manipulated by, 89–90
income statement manipulated by, 83
intangibles manipulated by, 89–90
inventory production, overseeing, 66
investments influenced by, 200
liability coverage inflated by, 89–90
maintenance capex and, 156, 157
mergers and, 161
nonmonetary transactions used by, 52–53
percentage-of-completion used by, 42–43
of portfolio, 200–216
return assumptions raised by, 98
revenue manipulated by, 35, 37, 38–42, 55
shareholders influenced by, 1–2
stock price managed by, 107–108
Wall Street and, 38, 52, 85, 86, 105, 123
Mandelbrot, Benoit, 196
Margin calls, 23
Margin of safety, 179–180, 181, 246
Market capitalization, 178, 183, 249, 250
Market composite signal, 239, 241
Market timing, 221, 229–230, 239
Markets. See also Bear markets; Bull markets; Market timing
companies influenced by, 190
conditions, 194
cycles, secular, 221
cycles of, 221–224
cyclical, 228
history of, 197–198
investors entering, individual, 224–225
performance, 239
shifts, 229–230
sideways, 223
stocks causing gains of, 10
time in, 220
MarketSmith charts, 205–208
Martin, Craig, 151
Maxim Integrated Products, 71–75, 88–89, 135–138
Medidata Solutions, 94–95
Merck, 114
Microsoft, 204–205
Modern portfolio theory (MPT), 176–177, 251–252
Money
Buffett on, 178–179
inflation, preserved against, 14
investors influenced by, 178
short side, gained on, 70
stock as way to make, 200
Montier, James, 161
Morgan, J. P., 197
Motorola, 113–114
Moving averages, price action smoothed out by, 230
MPT. See Modern portfolio theory
Munger, Charlie, 22
Mutual funds of investors, 200
The Myth of the Rational Markets (Fox), 177
Negative divergence, 67, 69, 70, 71–75
Net cash from operations. See Operating cash flow
Net income, 150
cash EPS, greater than, 152
on cash flow statement, 36, 123
OCF and, 135–138, 139, 141–143
reserves bolstering, 96
Net operating loss carryforwards (NOLs), 111
Netflix, 20–21
investment in, 200
as open situation, 28–29
stock of, 200
stock price of, 148
NOLs. See Net operating loss carryforwards
Nominal returns, investors and, 11
Nonmonetary transactions, 52–54
OCF. See Operating cash flow
Ockham’s Razor, 200
One-time gains. See Interest income Open situation, 26, 28–29
Openwave Systems, 142
Operating cash flow (OCF), 124, 150–151
of Helen of Troy, 142–143, 144
of Maxim Integrated Products, 135–138
net income and, 135–138, 139, 141–143
stock-based compensation added to, 125–126
working capital freeing, 128–135
Operating leverage of Akamai Technologies, 121
Opportunistic value, 183
Optionalities, 180–181, 184, 246
O’Shaughnessy, James P., 244–245
Oxford Health Plans, 186
Patience of investors, 174
Paulson, Hank, 197
P/E ratio. See Price-earnings ratio
Pension plans, 97–98
Percentage-of-completion accounting, 42–50
Portfolio, 200–216, 228. See also Long-short portfolio
PP&E. See Property, plant, and equipment
Precious metals, 181
Price action, 205, 209–210, 229, 230–241
Price charts. See Stock charts
Price-earnings (P/E) ratio in The Intelligent Investor , 184
Priceline, 155
Prices. See also Price action
allowance for doubtful accounts influencing, 86
companies discounting, 39
distributors influencing, 55
dividends influencing, 100
earnings in relation to, 182–186
indicators derived from, 205
institutions influencing, 209–210
inventory, 70–71
margin calls influenced by, 23
marked-down, 79–80
Netflix, 148
nonmonetary transactions fueling, 52–53
purchase, 90–92
revenue recognition influencing, 243
reverting to mean, 189–190
stock, 23, 52–53, 70, 77, 86, 100, 107–108, 175, 186, 189, 212–214, 243
Price-to-asset value. See Tangible book value
Price-to-earnings ratio v. price-to-sales ratio, 245
Price-to-sales ratio, 243, 244, 245–246, 248–249
Professionals restricted to large caps, 19
Profit margins, 48, 105, 118–121
Property, plant, and equipment (PP&E), 156
Protective stop. See Stop-loss order
PRTIX. See T. Rowe Price U.S. Treasury Intermediate Fund
Quality of Earnings (O’glove), 4, 69
Quest Software, 51–52, 102, 104–105, 162, 164, 260n4
Rangel, Charles, 112
Real estate, commercial, 180–181
Real returns, investors and, 11
Registered investment advisers (RIAs), 15–16, 18, 217, 252–253
Reinhart, Carmen, 197
Related-party revenue, 50–52
Relative strength line, 208–209
Reminiscences of a Stock Operator (Lefèvre), 18
Research, 175–177
Reserves, 77–79, 86, 95–97, 117–118
Returns. See also Nominal returns; Real returns
inflation influencing, 11, 12–13
investors maximizing, 230
monthly, 227
price-to-sales ratio influencing, 244
risk and, 230
SPY, 227
Revenue
balance sheet driven by, 36
bill-and-hold, 53–54
cash flow statement driven by, 36
charges influencing, 55
earned, 37
financial statements driven by, 36
frauds indicated by, 26
growth, 59–60
income statement driven by, 36
interest income in, 54
investors analyzing, 35
management manipulating, 35, 37, 38–42, 55
realizable, 37
realized, 37
related-party, 49–51
reserves boosting, 79
Revenue recognition, 32
bill-and-hold revenue influencing, 54
distributors influencing, 55
DSO influencing, 37–38
DSO pointing to, 247
earnings quality and, 36
interest income influencing, 54
nonmonetary transactions influencing, 52–54
percentage-of-completion method and, 42–50
policy, 55–59
price influenced by, 243
related-party revenue influencing, 49–51
revenue growth and, 59–60
sales-type leases influencing, 54–55
stock influenced by, 243
stuffng the channel influencing, 38–42
RIAs. See Registered investment advisers
Risk
Coca-Cola, 115
debt representing, 98
of General Electric, 114
investors maximizing, 230
long-short portfolio influencing, 30
management, 18, 33, 174, 215–216
returns and, 230
of salesforce.com, 262n5
stock, 15
technical tools reducing, 211
timing, of wrong, 211
Rogoff, Kenneth, 197
Rolling LTM. See Last twelve months (LTM)
Rothschild, Nathan, 195
Rovio, 25
Sales, companies manipulating, 245
salesforce.com, 90, 93, 94, 262n5
Sales-type leases, 54–55
Schilit, Howard, 245
Securities and Exchange Commission (SEC), 23
Security Analysis (Graham and Dodd), 175
Selling, general, and administrative (SG&A) expenses, 109
Sex, 177
SG&A expenses. See Selling, general, and administrative expenses
Shareholder equity, 83. See also Tangible book value
Shareholders, 1–2, 100, 128, 186–188. See also Shareholder equity
Shares. See Stocks
Short book. See Short side
Short sellers
catalysts influencing, 26
short thesis of, 211
short-only, 29–30
targets of, 20–22
Short side
drawdown reduced by, 220
long-short portfolio hedged by, 182
money gained on, 70
Short squeeze, 31
companies, 165
Siegel, Jeremy, 14, 257n10, 257n11
Silicon Laboratories, 63–66, 86–87
Skilling, Jeffrey, 25–26
Small-cap value, 15–16, 173, 175–177
Small-cap/bond spread indicator, 236–237
Son, Masayoshi, 51
S&P 500, 17, 195–198, 251, 252
S&P 500 index ETF (SPY), 225–227, 233–236
S&P 1500 Index, 245–246, 248–249
Sprott, Eric, 181
SPY. See S&P 500 index ETF
Steady-state business, 183, 186
Steak ’n Shake, 158–161
Stock charts
analyzing, 201
of Chipotle Mexican Grill, 201
of Ciena, 207
of Coinstar, 203
of EBIX, 202
of Green Mountain Coffee Roasters, 211
investors studying, 229
of Juniper Networks, 213
of Microsoft, 204
of OpenTable, 206
technicians reviewing, 199, 214
of WMS Industries, 209
Stock-based compensation, 125–128
Stock-bond spread indicator, 236, 238–239, 240–241
Stocks. See also Large caps; Shorting; Small caps; Stock charts
of Akamai Technologies, 122
allowance for doubtful accounts influencing, 86
based compensation, 125–128
brand-name, 10
buybacks, 165–169, 187–188, 264n8
buying, 17
catalysts working with, 179
as commodity, 200
companies contrasted with, 204–205
companies repurchasing, 187
debt issued for, 167–169
decline of, 17
dollar-cost averaging, 16–17
expectations shown by, 244, 246
gains caused by, 10
gains of, 17
growth, 244
Helen of Troy, 59–60
of indexes, 249–250
indexes as alternative to, 17
individual, 17
institutions moving, 206
management managing price of, 107–108
market’s gains caused by, 10
mispriced, 175
money, as way to make, 200
of Netflix, 200
Netflix, price of, 148
price, 23, 52–53, 70, 77, 86, 100, 107–108, 175, 187, 190, 212–214, 243
price action of, 209–210
revenue recognition influencing, 243
reverting to mean, 189
risk, 15
shorting influenced by, 216
tangible book value, low, 178–183
technology, 245–246
value, 264n8
value, below intrinsic, 188
Stocks for the Long Run (Siegel), 14
Stop-loss order, 216
Store of value, 15
Strategy
Graham, 175
long side, 5, 15–16, 173, 194–195
results from, comparison of, 233
small-cap value as, 15–16, 173
temperament required by, 174
Street. See Wall Street
Stuffing the channel, 38–42
Super Stocks (Fisher), 244
“The Superinvestors of Graham-and Doddsville” (Buffett), 176
Supply and demand, 205–208
Swenson, David, 179
T. Rowe Price U.S. Treasury Intermediate Fund (PRTIX), 233–234, 236
Taleb, Nassim Nicholas, 197
Tangible book value (TBV)
accounts receivable influencing, 101–102
of companies, 179
inventory influencing, 101–102
of Quest Software, 102, 104–105
stocks, 178–182
Tweedy Browne defining, 178
Tax-advantaged accounts, 14–15, 257n13. See also 401(k) plans
Taxes
acquisitions prevented by, 113
on cash, 111–112
companies and, 111–115
on Google, 114
holiday, 112–113
investors reviewing, 111
on Merck, 114
on Motorola, 113–114
profits as source of, 112
rules, 113
shareholder value hurt by, 113
stock options, benefits from, 126, 128
U.S., 111–112
valuation allowance, 111
TBV. See Tangible book value
Technical analysis, 199–200, 205, 229, 230
Technical tools, risk reduced by, 211
Teenybopper Inc., 80
Templeton, John, 174
Terminal short, 30
Theory
Efficient market, 176–177, 251–252
Modern portfolio, 176–177, 251–252
Tice, David, 245
Tilson, Whitney, 20–21, 28–29, 258n20
Timing, risk of wrong, 211. See also Market timing
Trading around 50 DMA, 212–213
Trends, 202–205
Tversky, Amos, 176–177
250-day moving average (250 DMA), 232–233
200-day moving average (200 DMA), 231–233
Under Armour, 132–134, 145, 146
United States (U.S.), 111–113. See also Government
Up/down volume ratio, 205–207
U.S. See United States
UTStarcom (UTSI), 49–51
Value. See also Shareholder value; Small-cap value; Tangible book value
acquisitions adding, 192
enterprise, 184
investing, 174
investors, 16, 100, 144–145, 155, 173, 174, 175, 176–177, 179–181, 191, 194–195, 246
investors influencing, 174
liquidation, 179
opportunistic, 183
price-to-sales ratio estimating, 243
stocks, 264n8
stocks below intrinsic, 187
Value-with-catalyst, 20
Vermaelen, Theo, 264n8
Volcker, Paul, 224
WAC. See Weighted average unit cost
Wall Street
on Akamai Technologies, 118–119
charges influencing, 109
companies, expectations of, 38–39, 52
DSOs and, 38
estimates of, 123
impairment charge added by, 77–78
management and, 38, 52, 85, 86, 105, 123
profit margins influencing, 105
reports, 22–23
Warranties, reserves for, 96–97
Wealth, War and Wisdom (Biggs), 15
Weighted average unit cost (WAC), 77
“What Has Worked in Investing” (Tweedy Browne), 173, 176, 177
What Works on Wall Street (O’Shaughnessy), 244
William O’Neil + Co., Inc., 205–208, 210, 217
WMS Industries, 134–135, 208–209
WONDA, 217
Working capital, 128–135
Zhang, Steve, 46–47