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New Straits Times
18-05-2025
- Business
- New Straits Times
MONEY THOUGHTS: High volatility: Friend or foe?
THE world's greatest investor is Warren Edward Buffett, currently (still) chief executive officer of New York Stock Exchange-listed Berkshire Hathaway. Buffett will turn 95 on Aug 30 this year, and recently announced that at the end of 2025 he will step down as CEO, yet thankfully retain his chairmanship of Berkshire, which he's controlled for 60 years. The reason many also consider Buffett the greatest living teacher of investing is his staggering capacity to adroitly share his thoughts and guidance on both business and investing. You will undoubtedly benefit from listening to Buffett speak on different facets of lifelong investing. So, here's a brief video clip of him speaking about recent market volatility: Note: Earth's capital market comprises two parts: the ownership-focused equity market, and the loanership-based fixed income market. Both are subject to price and thus valuation volatility. This means we might, understandably, lose sleep when our capital market investments fall in value. Frankly, it takes time (and many psychic bruises) to learn how to look at oscillating markets and rollercoaster valuations in an appropriate (translation: profitable) manner. Ideally, each of us should aspire to become incrementally better at stomaching unavoidable market volatility over the course of a typical two- to seven-decade investment time horizon spanning one lifetime. CRUX OF INVESTING In last week's Money Thoughts column, I referenced a foundational sentence written by Buffett's mentor Benjamin Graham, who is known as the Father of Security Analysis. In his important 1949 book, The Intelligent Investor, Graham stated: "Investment is most intelligent when it is most businesslike." Understand that Buffett was just 19 years old when he first read that seminal book. It triggered in him a trajectory-changing epiphany about the best way to invest. Later, Buffett studied under Graham at New York City's Columbia University, and several years later worked in Graham's investment firm Graham-Newman Corporation before branching out on his own when Graham retired. I'd now like you to think about what you do to earn a living… It probably involves providing goods or services, or both, in some way, shape or form. Am I right? For any such economic entity to succeed long-term, it must generate a surplus or profit. How is that done? By buying low and selling high, or by producing or manufacturing "stuff" at a cost that's lower than its selling price. That's the crux of any business. Therefore, if we take Graham's dictum to heart -- "investment is most intelligent when it is most businesslike" -- we understand it is also the crux of investing. HANDLING MARKET VOLATILITY Since volatile zigzagging investment asset prices give us numerous seasons to "buy low and sell high", it should be logical for us to welcome capital market volatility. However, we aren't always logical. Frankly, more often than not, we're nervous, anxious and afraid. Nonetheless, while there has only ever been one Warren Buffett, all of us can set the stage for greater economic success for our families and ourselves in the coming years and decades by taking three steps to better handle intermittent market volatility: 1. Save first, invest second; 2. Diversify across several asset classes and geographic regions, as well as over a very long timeline; and 3. Dynamically rebalance our portfolios when volatility creates opportunities and reasons to do so. To elaborate: Although successful investments yield far better returns than boring savings, having fat layers of cash savings help us all to stabilise our finances and thus steady our emotions during terrifying periods of market dislocations. (Interestingly, Buffett raised Berkshire's typical stabilising cash pile of US$100+ billion to more than US$300 billion prior to the steep capital market plummets triggered by Donald Trump's selfish, unwise, tariff-weaponised egregious assault on global free trade. Throughout his life, Buffett's been a genius-level observer.) In our own lives, within our undoubtedly smaller portfolios, similarly thickening our cash layers can and will stabilise our thoughts and thus our aggregate asset piles. INTELLIGENT DIVERSIFICATION The old saying, "Don't put all your eggs in one basket," encapsulates in just eight words the real reason intelligent diversification works so well in the rough and tumble world of global investing. Next week I'll elaborate on the powerful wealth-building strategy called Dollar-Cost Averaging or DCA. It is the best way I know of implementing the powerful principle of buying low and selling high. (If you aren't currently using it for your own investments, be sure to head back here for next week's DCA-focused Money Thoughts column.) Finally, for now take heed of the extreme valuation swings which sometimes materialise when high investment market volatility provides us with intermittently high and low portfolio values. As long as we stay focused on the wisdom of buying low and selling high, intense market volatility can — at different times — grant us high price levels to sell assets and thus raise our cash levels, and low-price levels to buy assets with our saved or stockpiled cash. Repeated cycles of buying low and selling high can help us build up liberating levels of wealth. © 2025 Rajen Devadason
Yahoo
15-05-2025
- Business
- Yahoo
Bruce Berkowitz's Strategic Moves: The St. Joe Co Sees a -1.56% Portfolio Impact
Bruce Berkowitz (Trades, Portfolio) recently submitted the N-PORT filing for the first quarter of 2025, providing insights into his investment moves during this period. Bruce Berkowitz (Trades, Portfolio) is the founder and the Managing Member of the Fairholme Fund (Trades, Portfolio). Prior to forming Fairholme Capital Management, Mr. Berkowitz was a Managing Director of Smith Barney, Inc. from December of 1993 to October of 1997. Bruce Berkowitz (Trades, Portfolio) concentrates his investments in a relatively small number of companies. He thinks that the more diversified the portfolio, the more likely the performance will be average. He likes companies with great managers, and deeply undervalued stocks. Benjamin Graham's "The Intelligent Investor" serves as the inspiration for Berkowitz' investment strategy. He focuses investments on companies that have exceptional management, that generate free cash, and that are cheaply priced. Berkowitz will also invest in mediocre companies that are trading at a significant discount to intrinsic value where there exists a catalyst event that makes it likely the gap between market price and intrinsic value will narrow in a reasonable amount of time. Warning! GuruFocus has detected 7 Warning Signs with JOE. Bruce Berkowitz (Trades, Portfolio) added a total of 2 stocks, among them: The most significant addition was Diamondback Energy Inc (NASDAQ:FANG), with 4,000 shares, accounting for 0.05% of the portfolio and a total value of $639,520. The second largest addition to the portfolio was Core Natural Resources Inc (NYSE:CNR), consisting of 5,000 shares, representing approximately 0.03% of the portfolio, with a total value of $385,500. Bruce Berkowitz (Trades, Portfolio) also increased stakes in a total of 2 stocks, among them: The most notable increase was Occidental Petroleum Corp (NYSE:OXY), with an additional 45,300 shares, bringing the total to 54,300 shares. This adjustment represents a significant 503.33% increase in share count, a 0.18% impact on the current portfolio, with a total value of $2,680,250. The second largest increase was Enterprise Products Partners LP (NYSE:EPD), with an additional 1,500 shares, bringing the total to 5,450,400. This adjustment represents a significant 0.03% increase in share count, with a total value of $186,076,660. Bruce Berkowitz (Trades, Portfolio) also reduced positions in 3 stocks. The most significant changes include: Reduced The St. Joe Co (NYSE:JOE) by 410,600 shares, resulting in a -1.99% decrease in shares and a -1.56% impact on the portfolio. The stock traded at an average price of $46.79 during the quarter and has returned -2.87% over the past 3 months and 3.36% year-to-date. Reduced Energy Transfer LP (NYSE:ET) by 686,300 shares, resulting in a -80.47% reduction in shares and a -1.13% impact on the portfolio. The stock traded at an average price of $19.48 during the quarter and has returned -8.38% over the past 3 months and -4.99% year-to-date. At the first quarter of 2025, Bruce Berkowitz (Trades, Portfolio)'s portfolio included 12 stocks, with top holdings including 78.07% in The St. Joe Co (NYSE:JOE), 15.31% in Enterprise Products Partners LP (NYSE:EPD), 2.26% in Bank OZK (NASDAQ:OZK), 2.14% in Berkshire Hathaway Inc (NYSE:BRK.B), and 1.53% in WR Berkley Corp (NYSE:WRB). The holdings are mainly concentrated in 4 of the 11 industries: Real Estate, Energy, Financial Services, and Technology. This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein. This article first appeared on GuruFocus. Sign in to access your portfolio
Yahoo
15-05-2025
- Business
- Yahoo
SEI Investments Company (SEIC): Among Benjamin Graham Stocks for Defensive Investors
We recently published a list of . In this article, we are going to take a look at where SEI Investments Company (NASDAQ:SEIC) stands against other Benjamin Graham stocks for defensive investors. Markets in early 2025 are a bit like a moody spring—75 degrees one day, stormy the next. After a strong run in 2023 and 2024, the S&P 500 dropped over 5% year-to-date as investors digested a mix of policy uncertainties, uncertainty around interest rate cuts, and pockets of corporate underperformance. Many stocks are being re-priced as investors grow more selective, and earnings outlooks weaken. At the same time, the bond market is quietly signaling a shift. Treasury yields are still elevated, but there's a growing sense that the Fed may be near the end of its hiking cycle. That has made Treasury and investment-grade bonds more attractive, especially compared to volatile equities. The market is in transition. Investors are moving from chasing momentum to seeking quality. Caution, realism, and discipline are back in style, and so are value stocks. Preparing for a potential recession is less about panic and more about applying timeless principles—many of which were championed by Benjamin Graham, the father of value investing. Graham taught that the key to long-term investment success lies in discipline, patience, and a deep understanding of value. In uncertain economic times, those lessons are more relevant than ever. Graham said in his book 'The market is a pendulum that forever swings between unsustainable optimism (which makes stocks too expensive) and unjustified pessimism (which makes them too cheap). In the short run, the market is a voting machine but in the long run, it is a weighing machine.' Rather than trying to time the market, investors should focus on building a portfolio grounded in quality and resilience. Graham favored companies with strong fundamentals, conservative balance sheets, and consistent earnings power—attributes that tend to shine when the economy slows. Dividend-paying stocks with a history of reliability also fit neatly into Graham's framework, offering both income and a margin of safety. Graham said in The Intelligent Investor: 'The essence of investment management is the management of risks, not the management of returns.' Diversification, another core tenet of Graham's philosophy, helps investors avoid overexposure to any one sector or asset class. Holding a variety of investments—equities, bonds, and even cash—can smooth returns and provide flexibility. Graham often emphasized the importance of keeping a cash reserve, not just for protection, but as a source of opportunity when market prices become irrationally low. Graham said, 'The investor's chief problem—and even his worst enemy—is likely to be himself.' Emotional discipline, especially during turbulent markets, is essential. By remaining rational, reassessing risk exposure, and maintaining a long-term mindset, investors can navigate recessionary periods with the confidence that volatility, like all market conditions, is temporary—and often presents some of the best chances to buy quality assets at a discount. We used the Classic Benjamin Graham Stock Screener by Graham Value to compile a list of the 10 Benjamin Graham stocks for defensive investors. We considered the top 20 stocks on our screen and picked the ones with the highest number of hedge fund investors, as of Q4 2024. The stocks are sorted in ascending order of hedge fund sentiment. At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here). A person sitting at a desk, their arms crossed, expressing the confidence of asset management and administration. Number of Hedge Fund Holders: 35 SEI Investments Company (NASDAQ:SEIC) provides financial technology, operations, and asset management services globally. SEI tailors solutions to help clients optimize their capital for growth. In 2024, 55% of revenue came from technology and operations outsourcing, and 40% from asset management fees. The company serves clients in four business segments, including major US banks and global investment managers, managing approximately $1.6 trillion in assets. Its core capabilities span investment processing, operations, and management. SEI Investments Company (NASDAQ:SEIC) reported Q1 2025 EPS of $1.17, up 18% year-over-year, driven by strong performance across all business units and expanded margins. Operating profit margin rose to 28.5%, the highest in three years. The firm achieved record net sales of $47 million, with $37 million recurring. SEI hosted its first global client symposium, enhancing brand perception and client engagement. The company announced the sale of its family office services business and emphasized its enterprise mindset, global diversification, and fortress balance sheet as key strengths amid market uncertainty. SEI's assets under management (AUM) and assets under administration (AUA) rose sequentially in the first quarter of 2025, despite a broader decline in the U.S. equity markets. This growth was broad-based and not concentrated in any single client, segment, or region. A significant driver was the conversion of previously signed deals and continued onboarding of new clients and advisers, particularly in the institutional and adviser channels. Inflows reflected backlog conversions, strong adviser engagement, global distribution partner wins, and activity across institutional and adviser channels. No single client or event drove inflows—growth came from broad strategies, new adviser onboarding, and international expansion. Positive net flows in both advisory and institutional segments offset market headwinds. The company's diversified footprint, especially in private credit and alternatives, alongside improved positioning and elevated client engagement, helped maintain momentum despite macroeconomic volatility. Overall, SEIC ranks 6th on our list of Benjamin Graham stocks for defensive investors. While we acknowledge the growth potential of SEIC, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than SEIC but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock. READ NEXT: and . Disclosure: None. This article is originally published at . Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-05-2025
- Business
- Yahoo
Fastenal Company (FAST): Among Benjamin Graham Stocks for Defensive Investors
We recently published a list of . In this article, we are going to take a look at where Fastenal Company (NASDAQ:FAST) stands against other Benjamin Graham stocks for defensive investors. Markets in early 2025 are a bit like a moody spring—75 degrees one day, stormy the next. After a strong run in 2023 and 2024, the S&P 500 dropped over 5% year-to-date as investors digested a mix of policy uncertainties, uncertainty around interest rate cuts, and pockets of corporate underperformance. Many stocks are being re-priced as investors grow more selective, and earnings outlooks weaken. At the same time, the bond market is quietly signaling a shift. Treasury yields are still elevated, but there's a growing sense that the Fed may be near the end of its hiking cycle. That has made Treasury and investment-grade bonds more attractive, especially compared to volatile equities. The market is in transition. Investors are moving from chasing momentum to seeking quality. Caution, realism, and discipline are back in style, and so are value stocks. Preparing for a potential recession is less about panic and more about applying timeless principles—many of which were championed by Benjamin Graham, the father of value investing. Graham taught that the key to long-term investment success lies in discipline, patience, and a deep understanding of value. In uncertain economic times, those lessons are more relevant than ever. Graham said in his book 'The market is a pendulum that forever swings between unsustainable optimism (which makes stocks too expensive) and unjustified pessimism (which makes them too cheap). In the short run, the market is a voting machine but in the long run, it is a weighing machine.' Rather than trying to time the market, investors should focus on building a portfolio grounded in quality and resilience. Graham favored companies with strong fundamentals, conservative balance sheets, and consistent earnings power—attributes that tend to shine when the economy slows. Dividend-paying stocks with a history of reliability also fit neatly into Graham's framework, offering both income and a margin of safety. Graham said in The Intelligent Investor: 'The essence of investment management is the management of risks, not the management of returns.' Diversification, another core tenet of Graham's philosophy, helps investors avoid overexposure to any one sector or asset class. Holding a variety of investments—equities, bonds, and even cash—can smooth returns and provide flexibility. Graham often emphasized the importance of keeping a cash reserve, not just for protection, but as a source of opportunity when market prices become irrationally low. Graham said, 'The investor's chief problem—and even his worst enemy—is likely to be himself.' Emotional discipline, especially during turbulent markets, is essential. By remaining rational, reassessing risk exposure, and maintaining a long-term mindset, investors can navigate recessionary periods with the confidence that volatility, like all market conditions, is temporary—and often presents some of the best chances to buy quality assets at a discount. We used the Classic Benjamin Graham Stock Screener by Graham Value to compile a list of the 10 Benjamin Graham stocks for defensive investors. We considered the top 20 stocks on our screen and picked the ones with the highest number of hedge fund investors, as of Q4 2024. The stocks are sorted in ascending order of hedge fund sentiment. At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here). Benjamin Graham Number of Hedge Fund Holders: 35 Fastenal Company (NASDAQ:FAST), founded in 1967, began by supplying threaded fasteners through local branches. Over time, it expanded into a global business-to-business distributor of industrial and construction supplies, offering nine major product lines. As of 2024, Fastenal operated 3,628 in-market locations across 25 countries, supported by 15 distribution centers and 23,702 employees. Its customer engagement is driven by branches, Onsite locations, vending and bin stock technologies, and eBusiness, with a focus on reducing customers' procurement costs. In the first quarter of 2025, Fastenal Company (NASDAQ:FAST) reported a 3.5% year-over-year increase in net sales. This growth was attributed primarily to internal execution improvements, new customer acquisition, and expanding existing relationships, rather than broader market demand, which remains sluggish. Safety product sales rose nearly 10%, supported by strong performance in Fastenal Managed Inventory (FMI) and vending programs. Digital sales accounted for 61% of total revenue, up from 59% a year ago, with a target of 66–68% by October 2025. Fastenal raised its quarterly dividend from $0.43 to $0.44 per share, aiming to surpass $1 billion in dividend payouts for the year. Larger customer sites, particularly those spending over $10,000 monthly, grew by 7%, driven by high-performing Onsite locations. However, the company acknowledged ongoing underperformance in small customer segments, especially those spending under $2,000 per month, citing weaknesses in its e-commerce platform. Addressing these gaps remains the company's key focus moving forward. Fastenal Company (NASDAQ:FAST) recognizes the need to improve its e-commerce strategy, especially to capture more of the random MRO (maintenance, repair, and operations) spend that can slip through even in strong customer relationships. Some departments within client organizations may still find it easier to purchase from other vendors online. Strengthening its e-commerce platform would allow Fastenal to better serve these segments and consolidate spending under its offerings. A robust digital presence is also seen as critical to enhancing performance across all customer types, including smaller accounts where Fastenal currently underperforms. Overall, FAST ranks 5th on our list of Benjamin Graham stocks for defensive investors. While we acknowledge the growth potential of FAST, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than FAST but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock. READ NEXT: and . Disclosure: None. This article is originally published at .
Yahoo
15-05-2025
- Business
- Yahoo
W.W. Grainger, Inc. (GWW): Among Benjamin Graham Stocks for Defensive Investors
We recently published a list of . In this article, we are going to take a look at where W.W. Grainger, Inc. (NYSE:GWW) stands against other Benjamin Graham stocks for defensive investors. Markets in early 2025 are a bit like a moody spring—75 degrees one day, stormy the next. After a strong run in 2023 and 2024, the S&P 500 dropped over 5% year-to-date as investors digested a mix of policy uncertainties, uncertainty around interest rate cuts, and pockets of corporate underperformance. Many stocks are being re-priced as investors grow more selective, and earnings outlooks weaken. At the same time, the bond market is quietly signaling a shift. Treasury yields are still elevated, but there's a growing sense that the Fed may be near the end of its hiking cycle. That has made Treasury and investment-grade bonds more attractive, especially compared to volatile equities. The market is in transition. Investors are moving from chasing momentum to seeking quality. Caution, realism, and discipline are back in style, and so are value stocks. Preparing for a potential recession is less about panic and more about applying timeless principles—many of which were championed by Benjamin Graham, the father of value investing. Graham taught that the key to long-term investment success lies in discipline, patience, and a deep understanding of value. In uncertain economic times, those lessons are more relevant than ever. Graham said in his book 'The market is a pendulum that forever swings between unsustainable optimism (which makes stocks too expensive) and unjustified pessimism (which makes them too cheap). In the short run, the market is a voting machine but in the long run, it is a weighing machine.' Rather than trying to time the market, investors should focus on building a portfolio grounded in quality and resilience. Graham favored companies with strong fundamentals, conservative balance sheets, and consistent earnings power—attributes that tend to shine when the economy slows. Dividend-paying stocks with a history of reliability also fit neatly into Graham's framework, offering both income and a margin of safety. Graham said in The Intelligent Investor: 'The essence of investment management is the management of risks, not the management of returns.' Diversification, another core tenet of Graham's philosophy, helps investors avoid overexposure to any one sector or asset class. Holding a variety of investments—equities, bonds, and even cash—can smooth returns and provide flexibility. Graham often emphasized the importance of keeping a cash reserve, not just for protection, but as a source of opportunity when market prices become irrationally low. Graham said, 'The investor's chief problem—and even his worst enemy—is likely to be himself.' Emotional discipline, especially during turbulent markets, is essential. By remaining rational, reassessing risk exposure, and maintaining a long-term mindset, investors can navigate recessionary periods with the confidence that volatility, like all market conditions, is temporary—and often presents some of the best chances to buy quality assets at a discount. We used the Classic Benjamin Graham Stock Screener by Graham Value to compile a list of the 10 Benjamin Graham stocks for defensive investors. We considered the top 20 stocks on our screen and picked the ones with the highest number of hedge fund investors, as of Q4 2024. The stocks are sorted in ascending order of hedge fund sentiment. At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here). A portrait of an industrial worker wearing safety equipment, smiling while inspecting a piece of equipment. Number of Hedge Fund Holders: 49 W.W. Grainger, Inc. (NYSE:GWW) is a leading distributor of MRO products and services, operating mainly in North America, Japan, and the UK. Its strategic framework, 'The Grainger Edge,' guides the company's purpose—We Keep the World Working®—and outlines expected behaviors. Grainger operates through two segments: High-Touch Solutions N.A., offering expert, value-added service for complex needs; and Endless Assortment, an online platform through Zoro and MonotaRO. It also includes other smaller businesses like Cromwell in the UK and a captive insurance unit. In Q1 2025, W.W. Grainger, Inc. (NYSE:GWW) reported a sales increase of 4.4% year-over-year to $4.31 billion, while operating margins remained strong at 15.6%, and EPS reached $9.86. High-Touch Solutions saw modest growth despite early softness due to weather and government delays, while Endless Assortment grew over 15%, led by strong results at Zoro and MonotaRO. April daily sales rose approximately 5.5%, showing improved momentum. Government demand, particularly in sectors affected by DOGE, was somewhat soft, though the company is primarily exposed to military and state-level agencies, limiting broader impact. The company's manufacturing segments, notably aerospace, continue to see strong performance. The company confirmed that private label goods are more heavily exposed to China, although total reliance on Chinese manufacturing has decreased slightly over the years due to shifts to countries like Vietnam and Mexico. Overall, GWW ranks 2nd on our list of Benjamin Graham stocks for defensive investors. While we acknowledge the growth potential of GWW, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than GWW but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock. READ NEXT: and . Disclosure: None. This article is originally published at . Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
