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Deep Value: Why Activist Investors and Other Contrarians Battle for Control of Losing Corporations (Wiley Finance)

4.31  ·  Rating details ·  383 ratings  ·  29 reviews
The economic climate is ripe for another golden age of shareholder activism

Deep Value: Why Activist Investors and Other Contrarians Battle for Control of Losing Corporations is a must-read exploration of deep value investment strategy, describing the evolution of the theories of valuation and shareholder activism from Graham to Icahn and beyond. The book combines engaging

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Kindle Edition, 236 pages
Published July 22nd 2014 by Wiley (first published January 1st 2014)
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Start your review of Deep Value: Why Activist Investors and Other Contrarians Battle for Control of Losing Corporations (Wiley Finance)
Devdutt
May 17, 2017 rated it it was ok
A line from the book "Rats beat the MBAs." sums up the point of this book. If you're of the belief that biases cannot be controlled and that one cannot gain any competitive advantage over others by improving judgment and analytical skill - you probably will agree with what Carlisle has to say. This book basically describes an investing strategy that needs one to believe in as a concept (mean reversion) and invest in a diversified portfolio of stocks (30 to 50) without knowing a thing about the ...more
朝凱
1.量化投資的優缺點:
1967年巴菲特在投資合夥信函中提到:自己在質化上有機率擁有很高的洞察力,然而洞察力通常相當罕見,量化派當然不需要洞察力,數字應該會像球棒一樣,敲擊你的腦袋。因此真正賺到大錢的人通常都是做對了質化決定的投資人。但是至少我認為,真正穩穩賺到錢的人顯然都是做出量化決定的人。

2.熱門股交易的迷思:
葛拉漢在證券分析中寫到:1929年大崩盤前的榮景,是由所謂的心理因素決定,當時的準則是不管是以多高的價格買進的好股(或績優股),都是健全的投資,骨子裡都只是以投資為名,合理化向普遍的賭博熱潮幾乎全面投降的方式。這種心理現象與近年一些取得主導地位、卻不可捉摸的因素價值觀,如善意、經營管理、預期獲利能力等息息相關。這種價值因素雖然是真的,卻不受數學運算影響,因此衡量這些因素的標準具有極大的任意性,會隨著流行的心理產生極大的變化。

我們對不確定的未來事件下決定時會根據三個捷思、捷徑或經驗法則,協助我們把複雜的認知任務變成比較簡單的作法,但這些做法卻導致我們對未來事件做出不好的決定,因為這樣會造成我們去思考不相關的證據,因而移轉了考慮事情基本機率的注意。
這三種狀況分別是代表性、可得性、
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Khaleel
Dec 08, 2015 rated it really liked it
An outstanding book that's shows and explains why traditional value strategies are still capable of producing market beating returns.

What I liked about the book:

Very simple and easy to read. It's about 280 pages and doesn't have too much superfluous writing. It's easy to read and understand.

Backed by empirical data that is a fairy large sample and is robust.

Provides a good understanding of the concept of mean reversion and its importance in investing.

What I did not like about the book:

Does not
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Manan
Sep 18, 2016 rated it it was amazing
"Extrapolation is instinctive while mean reversion is not."

In the era of moat and growth investing, this book provides much needed empirical evidence from across various time periods and markets, on how Graham type of strategies still outperform almost all other approaches. A must read.

Warning: The book is like an academic paper with tonnes of surveys and data. Not a very fluid read.
Apoorv Agrawal
Sep 07, 2017 rated it really liked it
Great summary of all forms of value investing: their origins, evolution and the world today. Starts reading like a research paper towards the end, but I don't mind it.
Massgreen
Jul 03, 2017 rated it it was amazing
Hands down one of the best books I have read to this date (read it twice in 6 months), it offers counter-intuitive ideas and facts, and backed by quality statistics.

Long version review:
Mean reversion in business is pervasive (can think of cyclical nature of businesses). High return businesses attract competition and drives down return to the point where the invested capital can no longer make any profit or even endure loss, some in the industry then choose to exit, and so the returns move
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Kaustubh Chaharia
Mar 05, 2018 rated it liked it
Shelves: investing
In the first half of the book, Tobias Carlisle compares various metrics used to identify deeply undervalued stocks and presents cases from empirical research that show deep value stocks in general outperform growth/quality stocks. This outperformance is attributed to the phenomenon of mean reversion.

In the second half, and the more interesting one, Tobias really gets to the heart of deep value investing by depicting cases of deeply undervalued companies from the real world and narrating how
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Nikhil
Nov 13, 2017 rated it really liked it
Shelves: business
Carlisle makes the case for intrinsic value relative to earnings (or the inverse - the acquirer's multiple) as the only measure of value worth pursuing. The author rushes through analyses, which makes it difficult to follow the logic at times, but provides copious supporting data for his argument in the form of charts, tables and other figures so the reader can follow along visually.
Suhrob
May 08, 2018 rated it really liked it
This is a collection of very detailed historical case studies with an interesting investing thesis hidden between the lines (and in the last chapter).

I enjoyed it, though would prefer more thesis, less history.
Leonardo Tukiman
Aug 11, 2019 rated it it was amazing
Gateway to value methodologies in practice.
Connor Stein
Oct 05, 2017 rated it really liked it
This book is borderline repetitive regarding the concept of mean reversion, but at the same time it is a treasure trove of counter-intuitive data on market beating deep value portfolios.
Yuni Amir
Nov 30, 2018 rated it it was amazing
The best book I've read this year - case studies coupled with academic findings, just how I like my theory reading.
Xiangjie
Nov 06, 2019 rated it it was amazing
Data-driven analysis, plus summary of great investors' philosophy, applicable for individual investors.
Value (Enterprise Multiple (EV/EBIT), on a portfolio level, contributes to return.
Sylv C
May 17, 2017 rated it really liked it
Excellent overview of the history of value investing with a good balance of insights from both academic theory and real-world examples.
Sanford Chee
Apr 29, 2015 rated it really liked it
This review has been hidden because it contains spoilers. To view it, click here.
Tao Lee
Feb 12, 2017 rated it it was amazing
Note to self: Activist investors takeover failing businesses with bad management to change the course and hope to yield high returns.
Joel Gray
Apr 01, 2017 rated it liked it
THE REALLY BIG MONEY TENDS TO BE MADE BY INVESTORS WHO ARE RIGHT ON QUALITATIVE DECISION BUT THE MORE SURE MONEY TENDS TO BE MADE ON THE OBVIOUS QUANTITATIVE DECISIONS.

Losing stocks - those in crisis, with apparently failing businesses, and uncertain futures - offer unusually favourable investment prospects - deep value investing.

From 1983 to 2008 the net net strategy returned 35% pa versus 13% for the market.

Apple was a net net in 2002 at $2.5b market cap - $7 per share versus $7.80 cash. In
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Asif
Sep 16, 2016 rated it it was amazing
Third book I read in the last 10 days. The first was King of Capital which was about the birth and rise of Private Equity (with some special emphasis on Blackstone). The second was Capital Returns a book written by compiling investor letters that Marathon Asset Management sent to its clients. The third is this book which mostly piqued my interest as I was looking for books on distressed equities. I would rate all 3 books as 5 stars for the wealth of information and new and unique perspectives. ...more
Philippe Brassard
Mar 16, 2015 rated it it was amazing
A Modern Investing Classic

The main point of Deep Value is reversion to the mean is a very powerful concept in investing. Its how Ben Graham's voting machine turns into a weighing machine.

This simple thesis is elaborated on throughout the book with lots of research along with fascinating real world examples of value investing successes.

A slight gripe could be made that more pages could have been devoted to the storytelling rather than technical analysis, but this still doesn't take too much away
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华 强
Jan 10, 2017 rated it it was amazing  ·  review of another edition
This book shows how valuations are more important than the qualitative aspects of companies. EVEN IF, the company is burning through cash. This is very counterintuitive to almost every investment book I have ever read. It is backed by research and it is statistically sound, however, I would depend on diversification to ensure some sort of defense. Buffett is a genius and can concentrate. I believe most of us are not. Most value investors would do themselves a great service by reading this book.
Karen Zhang
Jul 17, 2016 rated it it was amazing
Two key takes from the book: value works. People intuitively struggle with uncertainty, and this creates good chance to capture the value in troubled companies. Mean reversion exists. After five years, excellent companies become not that great and unexcellent companies becomes not that bad, suggested by one of the researches described in the book. This is quite important that it reminds me how human beings tend to overestimate the excellence of companies and sustainability of their extraordinary ...more
Michal Palczewski
Jul 26, 2015 rated it it was amazing
A very detailed look at what stocks are most likely to go up and how other investors have made money by finding value where others are too afraid to look. The basic premise is that valuation is the best predictor of future returns. Undervalued companies based on cash flow vs enterprise value are the ones most likely to earn a positive return. Companies with high growth are not. The concept of mean reversion is thoroughly discussed as it seems to be the primary driver for these returns. Overall a ...more
Amelia
Mar 09, 2016 rated it really liked it
It's a good book. I find chapters 1 to 4 and 10 more important than the middle section of the book. The mid section is more of case and academic studies. While those are interesting, they are more for readers with spare time. The real value of this book is in the first four and last chapters where he explains what are the measures for finding deeply under valued stocks and what situations to apply activist investing. This is not a beginner investment how-to book, it's more for people with at ...more
Mike Adeleke
May 13, 2016 rated it it was amazing
This book pulls from the experience and teachings of Benjamin Graham, Warren Buffet, Carl Icahn, and other who have been repeatedly able to find undervalued companies that have room for great returns. It shows the differences in their strategies but states the fundamental thesis that value in companies and in the market is almost solely for the contrarian investor and "following the crowd" or "picking hot stocks" almost always ends up producing few in any returns and often losses.
Arup Guha
Dec 22, 2015 marked it as to-read
The most intriguing investing book currently out there. Deeply researched, its shows multiple things. Graham still scores over Buffet for one. But at a deeper level, it probably shows that true intelligence lies in listening to the data and not in beliefs and principles. Cant wait to read and re-read.
Stewart Nielson
Sep 10, 2016 rated it it was amazing
This is a fantastic book that demonstrates the types of returns available via stocks that many would throw away. The author cites many studies that will turn what many investors think they know on it's head.
CRAWFORD COLLINS
Oct 08, 2015 rated it it was amazing
Very informative. Carlisle uses a lot of analogies to mythology and classics but stays tightly tethered to finance. He relates his thesis to behavioral finance principles well. Carlisle makes his case with such straight-forward science and logic that it is amazing these ideas are still investible.
Julio Loo
Feb 01, 2015 rated it it was amazing  ·  review of another edition
There are hundreds of books about value investing, but most repeat the same thing and don't offer actionable ideas except for this one.

Deep Value demonstrates the case that low priced stock in terms of EV/EBITDA outperforms expensive stocks.
Christoph Suter
Oct 21, 2014 rated it it was ok
Not worth the price. Some interesting tidbits. Too many typos and other errors.
その人
rated it it was amazing
Nov 29, 2016
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“It seems that the uglier the stock, the better the return, even when the valuations are comparable.” 1 likes
“The research seems to offer a contradictory view. Though they appear intensely unappealing—perhaps because they appear so intensely unappealing—deeply undervalued companies offer very attractive returns. Often found in calamity, they have tanking market prices, receding earnings, and the equity looks like poison.” 0 likes
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