Other guys read Playboy. I read annual reports.

Never count on making a good sale. Have the purchase price be so attractive that even a mediocre sale gives good results.

Calculate "owner earnings" to get a true reflection of value.

First, many in Wall Street - a community in which quality control is not prized - will sell investors anything they will buy.

The most common cause of low prices is pessimism - sometimes pervasive, sometimes specific to a company or industry. We want to do business in such an environment, not because we like pessimism but because we like the prices it produces.

Do not take yearly results too seriously. Instead, focus on four or five-year averages.

You have to turn over a lot of rocks to find those little anomalies. You have to find the companies that are off the map - way off the map. You may find local companies that have nothing wrong with them at all. A company that I found, Western Insurance Securities, was trading for $3/share when it was earning $20/share!! I tried to buy up as much of it as possible. No one will tell you about these businesses. You have to find them.