Investing For Value

Tips E-54: A 1-minute summary of my fundamental analysis of Bandai Namco Holdings Inc (TOKYO: 7832.T)        Investment Thesis Bandai Namco is a high-quality IP-led business, but its current valuation leaves value investors without sufficient downside protection. Long-term returns should come from powerful intellectual property, international expansion and disciplined execution rather than acquisitions or cyclical growth.  Main Business Bandai Namco monetises globally recognised intellectual property across toys, video games, digital content, attractions and external licensing. Its portfolio includes franchises such as Gundam and Pac-Man.  Growth International expansion and Toys & Hobby have driven growth, while Digital has surprisingly lagged its faster-growing underlying market. Revenue compounded at 5.5% over the past decade, driven mainly by double-digit growth outside Japan versus roughly 2% domestically.  Profitability Gross, contribu...

This is Chapter 20 of my book Mastering Value Investing: Practical Strategies for Real-World Results . Go there for links to the other chapters.   Investors often spend enormous effort analysing revenue growth, margins, ROIC, cash flow and competitive advantages. But after all those spreadsheets and charts, one question still matters: Is this company actually investable?  My approach is to turn all that fragmented analysis into an Investment Thesis Matrix built around two dimensions. First, absolute performance: Can the company grow profitably, earn attractive returns on capital and reinvest effectively? Second, relative performance: How does it compare with competitors — and is it gaining or losing ground? Put the two together and a company generally falls into one of four categories: Compounder. Turnaround. Laggard. Value Trap. But there is a catch. A company that looks like a Compounder may still be a poor investment if its balance sheet is weak. Conversely, a...

Tips E-53: A 1-minute summary of my fundamental analysis of Simpson Manufacturing Co., Inc. (NYSE: SSD)     Investment Thesis Simpson is a resilient, competitively advantaged compounder, but today’s valuation offers long-term investors no margin of safety. Its durable moats support stable margins and cash generation across cycles. However, organic growth is likely to remain GDP-like. Main Business Simpson manufactures structural construction products where brand leadership, local production and customer embeddedness create meaningful competitive advantages. Its engineering specifications embed Simpson products into building designs, creating switching costs and supporting pricing power. Growth Simpson’s underlying growth is modest, with the exceptional 2022 revenue increase reflecting acquisition and pricing rather than structural acceleration. Post-2022 growth slowed to about 3% annually, suggesting long-term organic expansion should broadly track GDP without fur...

Value Investing Case Study 134-1: A fundamental analysis of YTL Power International Berhad to assess whether it is an investment opportunity.       YTL Power is today more than an established business that spans power generation, water and sewerage, and telecommunications. Alongside them, YTL Power is building businesses in renewable energy, data centres, GPU computing, AI and digital banking. The interesting question is whether these are simply new investments - or pieces of a much bigger strategy. Over the past decade, YTL Power's revenue grew strongly, but the journey was far from smooth. Profits declined between 2018 and 2021 before rebounding sharply as the economics of its Singapore power business improved. Returns followed a similar pattern, and despite the recent recovery, its ten-year average returns were not particularly impressive. Yet there is another side to the story. YTL Power owns infrastructure that is difficult to replicate. Water networks, ...

Tips E-52: A 1-minute summary of my fundamental analysis of Rimini Street Inc. (NASDAQ: RMNI)     Investment Thesis Rimini is financially sound and asset-light, but its investment case depends on an operational turnaround not yet proven. Main Business Rimini provides independent enterprise-software support and increasingly offers managed and professional services around major business-critical systems worldwide. Revenue comes from annual support subscriptions, managed services, and project and professional services, although traditional software support remains dominant. Growth A huge addressable market contrasts sharply with slowing revenue growth, raising questions about Rimini’s ability to capture opportunity. Revenue compounded at 13.1% from 2016–2024, but growth has virtually stalled recently.  Profitability Rimini’s limited margin improvement means future profit growth must come primarily from renewed revenue growth and operating leverage. Contribution ...