What Short Sellers, the Voting and Weighing Machine are Offering Investors Today - KCR’s data-driven and historically informed process helps us avoid bubbles, find mispriced quality, and identify stocks that are simply too cheap.
KCR’s work leans heavily on sentiment for good reason. The presence of our in-house academic and co-founder does not mean we are advocates of efficient markets. Much of the research in behavioral finance that our systematic approach to fundamental research leans on is dedicated to finding undue pessimism and optimism. These are often a critical ingredient in generating outsized returns.
The High Price of Cool Stuff: An Update on Stocks Valued Over 10x P/S.
Lucid Motors Logo: A Symbol of the Future?
It’s been a hot stretch of summer for the KCR equity research team. We have, at times, been accused of writing dry and dense material with an intermittently academic tone. Not today. First Friday in August. Let’s talk cars.
Mean Reversion Made Simple - This paper provides simple context to what are often difficult and highly emotional decisions around money. KCR spent much of 2020 and 2021 producing evidence that the valuations of popular fast growth stocks would lead to their demise. Since the peak in 2021, stock speculation has gone from popular to perilous.
We get asked this question. A lot. Investors, scorched by multiple expansion in speculative stocks, are understandably concerned about the movement of prices in oil and gas. We believe the reason to invest in oil stocks stems from a fundamental backdrop for the sector, unlike anything we have seen in our careers.
Consumer Staples Stocks, Food, Famine & POLITICS - In this paper, we are going to be talking about food prices and profits. Let’s get our political views on the table so you understand our beliefs and biases. True story.
In Fast Growth Stocks, we explained the risks to “growth investors” seeking quick profits in some of the market’s most speculative firms. That rant laid the groundwork for our paper explaining the obvious opportunity to invest in growth companies at reasonable prices. A once in 20-year opportunity, in our view.
What the Past Can Teach Us: Record Valuations, Rock Bottom Interest Rates & Bull Market Peaks. Surviving a Bear Market. Legendary writer and investor Dennis Gartman is fond of saying that the person who loses the least money in bear markets wins.
Past Performance Does Not Guarantee Future Results…. Particularly the RECENT Past. This paper makes the following three points: 1) The mean reversion in the 2500 benchmarks will continue, with growth falling sharply relative to value, 2) The reason for this is painfully simple in our view and 3) Allocators should move from index funds to active managers in the R2500G sector
This continues our piece yesterday covering the first 9 chapters of Bethany McLean and Peter Elkinds’ luminous book on Enron. While we believe our take-aways from Chapters 10 - 22 of the book below are helpful reminders...
Summary of Enron Smartest Guys in the Room:
Bethany McLean and Peter Elkind wrote the national bestseller “The Smartest Guys in the Room.” The book catalogues the rise of Enron, the financial crisis that would eventually consume it and exposes the subsequent accounting scandal. We do not write this missive to celebrate the devastating losses created by Enron Corporation...
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