Value Investing: From Graham to Buffett and Beyond - Book Review

Value Investing: From Graham to Buffett and Beyond (Wiley Finance)





What Is It About?

Value Investing is written by Bruce Greenwald, a professor at the Columbia Business School. As the title suggests the book is about value investing. The book is divided into three parts. They are: an overview of what is value investing; an examination of three methods to implement value investing; and case studies of several well known value investors and how they put into practice the tenets of value investing.


What Did I Get Out Of It As A New Investor?

This is a great book to get a solid grasp on value investing. While the The Little Book of Value Investing is a great introductory book, Value Investing takes the next step and provides intermediate tools to practice value investing. The book analyzes three methods of performing a value analysis. The book first looks at value in principle, the breakdown of the present value of future cash flows. It next provides a means of understanding how to value the assets of a company. Finally, it examines both the value of the assets with an incorporation of the earnings power of a company's brand, in other words, the company's franchise value. All three sections are then woven into a comprehensive analysis using company specific examples.


The Good News

This is a great intermediate level book for the new value investor. It moves beyond the simple idea of a discounted cash flow analysis and introduces one to an understanding of how and where to find value.


The Bad News

This book is written by a college professor and therefore reads as a college text. While not excessively technical, this book is not one to be read straight through. The better approach would be to enjoy this book over a few weeks time to allow for consideration of the material as it is digest chapter by chapter.


The Bottom Line

I found this book helpful and feel it is a very good book to own for any investor who has an interest in developing a better understanding of value investing but who is not ready to tackle more advanced texts.

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