Investing For Value

Tips E-26: A 1-minute summary of my fundamental analysis of Roper Technologies Inc. (NASDAQ: ROP)    Investment Thesis Roper Technologies has successfully pivoted toward mission-critical vertical software with resilient, recurring revenues. However, returns on invested capital remain below its cost of capita. While fundamentally sound, its acquisition-led growth and valuation leave no margin of safety. Main Business Roper businesses are deeply embedded in customer workflows across healthcare, insurance, construction, utilities, and government. This creates high switching costs and durable recurring revenues. Application Software now accounts for over half of revenue, complemented by network software and select tech-enabled products. Growth Post-2020 growth accelerated to double digits, but organic growth remains mid-single digit, implying continued reliance on M&A to sustain headline growth rates. Profitability Roper delivers industry-leading margins and cash gene...

This is Chapter 6 of my book Mastering Value Investing: Practical Strategies for Real-World Results . Go there for links to the other chapters.   Most investors start in the wrong place. They look at stock prices. They chase forecasts. They argue about valuation multiples. But here is the uncomfortable truth: if you do not understand the business, valuation is just guesswork. In this chapter, I walk through my real-world framework for analysing a company - the same structured approach I have refined over two decades in corporate planning and financial analysis. It starts with one principle: business analysis comes first. Before you think about intrinsic value, you need to answer harder questions: How does this company really make money? Is growth driven by volume, pricing power, or acquisitions? Instead of pretending we can predict the future with precision, I simplify it into three scenarios: performance will be the same as the past, better than the past, or worse th...

Tips E-25: A 1-minute summary of my fundamental analysis of Rambus Inc (NASDAQ: RMBS)     Investment Thesis Rambus has successfully transitioned toward scalable IP licensing and memory interface chips aligned with AI and data-center growth. Strong moats and financial discipline support long-term value creation, but optimistic market pricing already reflects much of this improvement. Main Business Rambus operates a focused, fabless model built on proprietary memory interface chips and high-margin silicon IP licensing. Its two core segments serve advanced computing, AI, and data-center ecosystems. Deep customer integration, enforceable patents, and long design cycles create high switching costs, supporting recurring revenues and durable competitive advantages. Growth Revenue growth has been steady, supported by acquisitions and favourable end-market tailwinds rather than aggressive organic expansion alone. AI infrastructure, DDR5 adoption, and data-center expan...

Value Investing Case Study 120-1: A fundamental analysis of Nestle (Malaysia) Berhad, where I assess whether it is a high-quality business with fading economics.    For decades, Nestlé (Malaysia) Berhad has been the gold standard of Malaysian consumer staples. Iconic brands. Stable demand. Strong dividends. But a closer look at the numbers tells a more complicated story. Over the past decade, Nestlé Malaysia has continued to grow revenue steadily and generate impressive cash flows. Returns on capital remain well above the cost of capital — a hallmark of a high-quality business. Yet beneath this resilience lies a persistent and uncomfortable trend: profits and margins have been quietly eroding. Gross profit and contribution margins have been on a long-term decline. This is not a story of bloated overheads or sloppy execution — fixed costs are tightly controlled. Instead, the pressure is coming from the top of the income statement: sustained input cost inflation, cons...

Tips E-24: A 1-minute summary of my fundamental analysis of TTM Technologies Inc. (NASDAQ: TTMI) Investment Thesis TTMI now focuses on advanced PCBs and mission-critical systems rather than commoditized consumer electronics. Despite this strategic progress, persistent cost-control issues and subpar returns on capital mean the transformation has not translated into sustainable shareholder value. Main Business The company products are used in aerospace and defense platforms, data center infrastructure, and automotive electronics. These markets feature higher reliability requirements and longer product cycles, supporting differentiation but demanding disciplined execution and cost management. Growth From 2015 to 2024, revenue grew only about 1.7% CAGR as TTMI divested consumer-facing units and shut down commoditized operations. Underlying demand improved, evidenced by 9.4% growth in 2024 when no divestitures occurred, suggesting better organic potential going forward. Profitabili...