Investing For Value

Tips E-48: A 1-minute summary of my fundamental analysis of Booz Allen Hamilton Holding Corporation’s (NYSE: BAH)   Investment Thesis Booz Allen is a high-quality compounder whose long-term value creation rests on durable institutional advantages. Despite recent concerns over contract delays and weaker near-term growth, the company remains deeply embedded within the U.S. federal ecosystem. Its long-term investment case rests on resilient government demand, selective acquisitions, and disciplined capital allocation. Main Business Booz Allen has evolved from a consulting firm into a technology-enabled mission partner. Through its VoLT strategy, the company is expanding capabilities in AI, cyber, cloud, and digital modernization while leveraging structural moats such as security clearances and long-standing agency relationships. Growth Steady revenue growth has been supported by both organic expansion and capability-driven acquisitions. Profitability Profit growth has bee...

This is Chapter 17 of my book Mastering Value Investing: Practical Strategies for Real-World Results . Go there for links to the other chapters.   Most investors are comfortable valuing stable businesses. But what happens when a company is recovering from a downturn, transforming its business model, or benefiting from a cyclical rebound? This is where many valuations go wrong. Applying a single growth rate or assuming today's margins will continue indefinitely often produces misleading results. The challenge is not building a more complicated spreadsheet - it is understanding how the business itself is likely to evolve. In this chapter of Mastering Value Investing, I explain why businesses in transition require a completely different way of thinking. Rather than forcing the future into a single set of assumptions, I show how to break the journey into distinct phases, allowing growth, profitability and reinvestment to change as the business matures. Using Mosaic as a r...

Tips E-47: A 1-minute summary of my fundamental analysis of CyberArk Software Ltd (NASDAQ CYBR)   Investment Thesis CyberArk had already begun an operational turnaround, but returns remained depressed by acquisitions and equity expansion. The acquisition by Palo Alto effectively brings forward several years of execution, allowing shareholders to realize value immediately while retaining exposure to future synergies through the stock component. Main Business CyberArk is a leading identity-security specialist built around recurring subscription and privileged access management solutions. The company secures human and machine identities across cloud, hybrid and on-premise environments.  Growth The identity-security market is expanding at low- to mid-teen rates, yet CyberArk achieved a 22.5% revenue CAGR over the past decade. Growth was supported not only by favorable industry trends but also by acquisitions. Profitability Margins suffered after 2019 as CyberArk shif...

Value Investing Case Study 131-1: A fundamental analysis of Press Metal Aluminium Holdings Berhad to assess whether it is an investment opportunity.      Press Metal has evolved from a regional aluminium extruder into Southeast Asia's leading integrated aluminium producer through upstream integration, low-cost renewable hydropower, higher-value products and continuous operational improvements. One of the biggest mistakes investors make when analysing cyclical companies is judging them based on a single year's results. Aluminium prices rise and fall with the global economy, causing revenue and profits to fluctuate. The challenge is separating temporary cyclical swings from genuine improvements in the underlying business. Press Metal’s revenue experienced cyclical dips in both 2019 and 2023, yet over the decade it still grew at a double-digit CAGR. Even more surprising, profits grew much faster than revenue - not because aluminium prices kept rising, but because man...

Tips  E-46: A 1-minute summary of my fundamental analysis of SiTime Corporation (NASDAQ)  Investment Thesis Since its 2019 IPO, SiTime has expanded from oscillators into a broader timing platform and appears to be taking market share through sticky design wins and switching costs. However, profits have proven elusive, and the current share price assumes execution far beyond what the company has historically demonstrated. Main Business SiTime is a fabless provider of MEMS-based timing products that compete with traditional quartz solutions. Its competitive advantages stem from patents, customer embeddedness, long product life cycles and a programmable fabless manufacturing model. Growth While the timing-device market is expected to grow at only mid-single-digit rates, SiTime achieved a 19% revenue CAGR from 2019 to 2024 despite a sharp cyclical decline in 2023. Growth has been largely organic, driven by design wins, richer product mix and portfolio expansion. Profitability...