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.

They really can’t afford to be contrarians. A major investment house can’t afford to do research for five customers who won’t generate a lot of commissions.

What differentiates us from other money managers with a similar style is that we’re comfortable with new lows.

In every analysis you need to isolate what the real assets are and you must not forget to examine the franchise to do business, to review the character and competence of the management and to estimate the outcome if the whole business had to be turned into cash.

One of the dangers about net-net investing is that if you buy a net-net that begins to lose money your net-net goes down and your capacity to be able to make a profit becomes less secure. So the trick is not necessarily to predict what the earnings are going to be but to have a clear conviction that the company isn't going bust and that your margin of safety will remain intact over time.

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

We do liquidation analysis and liquidation analysis only.