Photo by Roberto Contreras on Unsplash So we did a lot of math last time to determine the Tangible Book Value of a stock, determining if it was worth the purchase from a tangible asset perspective. For our example company, Nestlé, this purchase was not a great buy from the TBV perspective. As I said though, this doesn't necessarily mean it isn't a buy. After all, we did note in the supermarket a very large stock of their Lean Cuisine frozen meal line. Today, we calculate the fair market value, or FMV, of Nestlé. What is Fair Market Value (FMV)? Clinically, we could look at Investopedia and see that Fair Market Value is defined as, "the price that an asset would sell for on the open market," however, I think that is too cut and dry. We need to better understand what that means. This means, if the profits to earnings remain ...
Photo by Patrick Weissenberger on Unsplash In November 2020, I sat down to lunch with a close friend in a socially distanced restaurant and we began to talk about what we had been up to. Within what felt like moments, we had caught up on family and the preciously few adventures people could have during a global pandemic and then we started talking investments. Admittedly, I knew little to nothing about investing because my 401K was on autopilot and I thought the stock market was for people much smarter than me. As he shared some inspirational reading, I came home and downloaded An Intelligent Investor by Benjamin Graham on Audible . Thus the journey into investing began. Here I sit, five months later and a whole lot of lessons learned and some half way decent returns on my investments. In the past 5 months, I've seen a return of over 16% on my investment and expect to hold all of my shares for years to come. Alright, that said, let's get to those lessons: Lesson 1: Do Th...