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Would this writeup get you into VIC today?


innerscorecard
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No catalyst, no chance.

 

Edit: actually the "wave of rate increases", leading to higher 1952 earnings was a potential catalyst. :-) I do think that ideas without catalysts do deserve to be published on VIC more and I have the impression that these ideas tend to get overlooked. Greenblatt is biased towards ideas with catalysts, because that has worked so well for him. It does not mean it is the only way to go and that other approaches to value investing cannot work well.

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Guest Schwab711

Let's invert. Are there any investments like that today that have a simple writeup and are going to become as big as GEICO did?

 

Interesting view. I think a number of people see AMZN in this way but the valuation takes away all of the GEICO-like profits. What exactly are we looking for to match the prospects of 1951 GEICO? A business with low market share and the lowest-cost producer in an industry with historically high demand or mandatory demand?

 

TDG comes to mind though their ceiling is much lower than GEICO's. FICO but they already have such significant market share and the again the ceiling is only so high. Maybe a small beverage, insurance, bank, or retailer of basic goods (think AMZN/Wal-mart)? I guess the more likely answer may be some type of tech company since auto insurance was only mandatory in Mass in 1951 (with NY being the next domino in 1956 and the rest of the US in the 1970's which surprised me)! Anyone else have ideas for tech companies? Sadly I work in an IT role and know very little about many tech industries...

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