The share price must be less than book value. Preferably it will be less than net working capital less long term debt.

Long term debt and bank debt (including off-balance sheet financing must be judiciously employed. There must be room to expand the debt position if required.

I think that intelligent forecasting (company revenues, earnings, etc.) should not seek to predict what will in fact happen in the future. Its purpose ought to be to illuminate the road, to point out obstacles and potential pitfalls and so assist management to tailor events and to bend them in a desired direction. Forecasting should be used as a device to put both problems and opportunities into perspective. It is a management tool, but it can never be a substitute for strategy, nor should it ever be used as the primary basis for portfolio investment decisions.

Protect the downside. Worry about the margin of safety.

The company must be profitable. Preferably it will have increased its earnings for the past five years and there will have been no deficits over that period.

The share price must be less than book value. Preferably it will be less than net working capital less long term debt.

The price must be less than one half of the former high and preferably at or near its all time low.