Monthly Archive for November, 2006

DBRN: How much profit?

Following up th/e previous post on Dress Barn’s numbers, we’ll take a look at how you would have made out investing in DBRN using Big Moat entries and exits.

Start Date: 1/1/2003
End Date: 10/19/2006

# of Trades: 29
# of Winning Trades: 10
# of Losing Trades: 19

$ of Profit: $9847.20
% Return: 98.47%

Largest Single Winning Trade: $8294.52
Largest Single Losing Trade: ($2857.20)

based on an initial investment of $10,000

Big Moat Analysis: Dress Barn (DBRN)

Chico’s and Coldwater Creek are retailers that are favorites of many people looking for Big Moat companies.  Today I saw that Dress Barn was one of Nasdaq’s most active stocks so I decided to run the numbers on DBRN.

DBRN (11/28/06)

The numbers look good and the stock closed at $24.46 today which was up almost $3 on the day.  Looking at the YTD chart, the stock has been trading sideways most of the year and all three arrows are currently red.  This is definitely a stock to watch but currently not quite a buy at this time.

Benjamin Graham’s method of calculating the MOS

A recent article in Business Standard from India takes a look at the stocks that pass a method similar to Benjamin Graham’s method of calculating the MOS for companies. Their overall conclusion is that this method is good for identifying undervalues stocks with a good margin of safety. This isn’t much of a surprise considering that Graham is considered one of the greatest investors of all time. To learn more I suggest reading Graham’s The Intelligent Investor.

Label Obsession

I came across an article that calls for a decline in value stocks because they have outperformed growth stocks in recent years. The main thing I got from the article is that people are obsessed with labels.

After reading the article you should see that Big Moat investing is great because you are looking for good value in a stock but that does not mean you are looking for ‘value stocks’. Big Moat methodologies work just as well with so-called value stocks, growth stocks, or any other kind of stock as long as they meet the Big Moat criteria.

The article also has a great “thanks for pointing out the obvious” sentence too: (emphasis mine)

It appears that yesterday’s growth stocks may be today’s value stocks, and vice versa. But no matter which category you aim to invest in, you’re dealing with a moving target.

Wallstrip Discussion: Berkshire Hathaway

Today’s installment of Wallstrip covers Berkshire Hathaway, the company headed by Warren Buffett.

Buffett and his mentor Benjamin Graham provided the basis for Big Moat investing. No one can argue with the success of Buffett’s methodology, especially since Berkshire’s stock recently passed $100,00 per share.