Investing For Value

Tips E-49: A 1-minute summary of my fundamental analysis of Monolithic Power Systems Inc.’s (NASDAQ: MPWR)       Investment Thesis Monolithic Power combines exceptional business quality with valuation risk, leaving little room for investor error. The company has built a strong record of organic growth through proprietary technology, customer integration, and an asset-light model. However, much of this strength appears already reflected in the share price, limiting the margin of safety for long-term value investors. Main Business Monolithic Power is a fabless analog semiconductor company specializing in proprietary power-management solutions. Its products are used across data centers, automotive, industrial automation, and communications markets.  Growth From 2015 to 2024, revenue compounded at 23% annually, far exceeding the mid-single-digit growth of the power-management IC market. Management attributes this performance to engineering-led innovation an...

Value Investing Case Study 132-1: A fundamental analysis of Supermax Corporation Berhad to assess whether it is an investment opportunity.       Most investors think the story of Supermax is straightforward. COVID-19 created extraordinary demand for gloves. The company expanded aggressively. Demand later collapsed, profits disappeared, and the share price followed. But that explanation is incomplete. The real issue is not that Supermax lost its competitive advantage. In fact, its global distribution network and downstream business model remain largely intact. The bigger problem is that the company's economics have changed. During my analysis, I found that the pandemic expansion created a new operating breakeven level. The enlarged asset base and higher fixed costs mean Supermax now needs substantially more revenue than before COVID just to break even. This is why simply waiting for glove demand to recover may not be enough. The encouraging sign is that contri...

Tips E-48: A 1-minute summary of my fundamental analysis of Booz Allen Hamilton Holding Corporation’s (NYSE: BAH)   Investment Thesis Booz Allen is a high-quality compounder whose long-term value creation rests on durable institutional advantages. Despite recent concerns over contract delays and weaker near-term growth, the company remains deeply embedded within the U.S. federal ecosystem. Its long-term investment case rests on resilient government demand, selective acquisitions, and disciplined capital allocation. Main Business Booz Allen has evolved from a consulting firm into a technology-enabled mission partner. Through its VoLT strategy, the company is expanding capabilities in AI, cyber, cloud, and digital modernization while leveraging structural moats such as security clearances and long-standing agency relationships. Growth Steady revenue growth has been supported by both organic expansion and capability-driven acquisitions. Profitability Profit growth has bee...

This is Chapter 17 of my book Mastering Value Investing: Practical Strategies for Real-World Results . Go there for links to the other chapters.   Most investors are comfortable valuing stable businesses. But what happens when a company is recovering from a downturn, transforming its business model, or benefiting from a cyclical rebound? This is where many valuations go wrong. Applying a single growth rate or assuming today's margins will continue indefinitely often produces misleading results. The challenge is not building a more complicated spreadsheet - it is understanding how the business itself is likely to evolve. In this chapter of Mastering Value Investing, I explain why businesses in transition require a completely different way of thinking. Rather than forcing the future into a single set of assumptions, I show how to break the journey into distinct phases, allowing growth, profitability and reinvestment to change as the business matures. Using Mosaic as a r...

Tips E-47: A 1-minute summary of my fundamental analysis of CyberArk Software Ltd (NASDAQ CYBR)   Investment Thesis CyberArk had already begun an operational turnaround, but returns remained depressed by acquisitions and equity expansion. The acquisition by Palo Alto effectively brings forward several years of execution, allowing shareholders to realize value immediately while retaining exposure to future synergies through the stock component. Main Business CyberArk is a leading identity-security specialist built around recurring subscription and privileged access management solutions. The company secures human and machine identities across cloud, hybrid and on-premise environments.  Growth The identity-security market is expanding at low- to mid-teen rates, yet CyberArk achieved a 22.5% revenue CAGR over the past decade. Growth was supported not only by favorable industry trends but also by acquisitions. Profitability Margins suffered after 2019 as CyberArk shif...