Aswath Damodaran: The Problem With ‘Old Time’ Value Investors

Johnny HopkinsAswath DamodaranLeave a Comment

In his latest interview with Elearnmarkets, Aswath Damodaran discusses the problem with ‘old time’ value investors. Here’s an excerpt from the interview:

Damodaran: First, let me first push back. You said you’re an old-time value investor right? How many old-time value investors actually value companies? Maybe one in a hundred.

When you say old-time value investors I think Ben Graham, Warren Buffett, that most of them don’t value companies. They price them. They price them based on price earnings or price to book and you had all these little screens you ran.

You know, pick stocks, low P/E ratios, nobody valued companies. So when people talk about… we used to value companies I call them as liars and I’ll go to Omaha and say this to the faces of all of those portfolio managers show up there, they’ve always been pricing companies.

You can watch the entire discussion here:

 

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