Book Description
About 75 percent of active investors consistently deliver returns below those of passive index funds. Why? In part, it's because proven methods for valuing assets are too complex to apply-causing investors to rely on commonly used benchmarks such as current earnings and price-earnings multiples that simply don't reflect how the market prices stocks.
Now, leading valuation experts Alfred Rappaport and Michael J. Mauboussin argue that the secret to beating the market stands in plain sight. Embedded in the stock price-the most accessible piece of information in the investment arena-lies all investors need to know about how the market expects a company to perform. By correctly decoding that information, say the authors, investors are on the way to anticipating changes in a company's competitive position that the current stock price doesn't reflect-and making informed buy, hold, or sell decisions before the rest of the crowd. This proven approach, expectations investing, holds the potential to change the rules and improve the odds of the stock selection game forever.
The beauty of expectations investing is that it harnesses the power of the market's own tried-and-true pricing model-discounted cash flow-without requiring difficult and often dubious long-term forecasting. Highly practical, the book provides a strategic framework and corresponding tools for using price-implied expectations (PIE) to:
· Interpret current prices and anticipate revisions in expectations.
· Monitor signals from managerial actions such as mergers and acquisitions and share buybacks and estimate their impact on shareholder value.
· Devise, adjust, and communicate management strategy in light of shareholder expectations.
In addition, a unique expectations infrastructure helps track value creation from the initial triggers that shape performance to the resulting impact on sales, operating profit margins, and investment efficiency.
Universally applicable to public companies across the economic landscape, Expectations Investing will enable professional investors, analysts, and executives to translate heightened uncertainty into lucrative opportunity.
Alfred Rappaport is the Leonard Spacek Professor Emeritus at Northwestern's Kellogg School and is Shareholder Value Adviser to L.E.K. Consulting. He originated the Shareholder Scoreboard for the Wall Street Journal. He can be contacted at al.rappaport@expectationsinvesting.com. Michael J. Mauboussin is a Managing Director and Chief U.S. Investment Strategist at Credit Suisse First Boston. He is also an Adjunct Professor at Columbia Business School. He can be contacted at michael.mauboussin@expectationsinvesting.com.
Visit the book's dedicated Web site at: www.expectationsinvesting.com
Customer Reviews:
Must read for investors who invest in individual companies.......2007-01-30
I am an individual investor investing primarily in individual companies. "Expectation investing" provides me with an effective process that I can trust, believe and most importantly to follow in my decision makings.
Armed with this process, and the blackjack winning strategy (you bet big when you have favorable odds), it becomes evdient to me that in the long run, small ivestors can achieve excessive returns. "More than you know" is another book you MUST read. The favorable odds likely happen when investors' indenpendence break down as a result of some legitimate big events.
I have read all of the articles written by Michael Mauboussin that can be found on the internet. It is one of the best gifts I give to myself.
An interesting read.......2006-09-28
An interesting read for the serious investor. The central tenet of the book might be stated as "investors do not earn superior rates of return on stocks that are priced fully to reflect future performance - even for the best value-creating companies - which is why great companies are not great stocks." This book posits that investors can read market expectations contained in a stock's price and anticipate revisions in those expectations to achieve superior returns. It book provides a detailed, step-by-step way to accomplish this process.
"Expectations Investing" is divided into three parts. Part I details how to determine the expectations for a stock based upon its current market price. Interestingly, rather than determine a "fair price" based upon a company's free cash flow, the book turns this process upside down, using a company's stock price to determine the market's expectations for free cash flow going forward. Next, the book helps identify "expectations opportunities" - places where revisions in the stock market's expectations are likely to take place. By focusing on key areas where expectations opportunities may take place (so-called "turbo triggers"), the skilled investor can modify their discounted cash flow projections to determine the appropriate price. This section further provides a framework to determine when to apply buy, sell, and hold decisions. Lastly, Part III of the book explains how certain, specific corporate events (mergers, share buybacks, and incentive compensation) may signal that expectations revisions are in order.
Within the book itself, I found the chapter on "Analyzing Competitive Strategy" to be an outstanding, investor-focused distillation of many of the points contained in Porter's "Competitive Strategy." Moreover, the chapters on specific corporate events were interesting insofar as they explain, in greater detail than I had read before, the quantitative analysis that underlies decisions related to mergers, share buybacks, and incentive compensation.
Potential readers should be aware that the authors of this book, like many stock analysts, adhere to the so-called "Capital Asset Pricing Model" school of thought (that the value of a security equals the rate on a risk-free security plus a premium, beta, which is determined based upon the volatility of the security in question). This model is just one of many that investors may use. Moreover, although stock analysts may have access to customers, creditors, competitors, and company insiders, many individual investors will lack those contacts, and thus face some difficulty in determining possible expectations revisions. Even if an investor had access to such information, the developing field of behavioral finance (see Belsky and Gilovich, "Why Smart People Make Big Money Mistakes" as but one example) would caution that investors seeking to implement the methods set forth in this book need to be careful of confirmation bias (tending to view information in a way that supports their pre-determined preferences) and information cascade (too much information), among others.
Lastly, readers should be aware that modeling out the process described by this book requires some math, and the ability to create spreadsheets of middling-level complexity. This is not a "buy low P/E" book - readers will have to do their homework to use these methods. Anyone who isn't looking to put several hours into investigating each stock they are interested in should look elsewhere.
In all, this is a well-written book that makes a very complicated process relatively simple. It is not designed for the casual reader, and implementing the expectations investing process certainly takes considerable work. However, the book provides valuable insights into how analysts function and how stocks are priced by public markets.
However, if forced to pick a well-written, fairly sophisticated book on investing, I'd recommend a few other books ahead of this one, including "Security Analysis" by Benjamin Graham and either of Martin Whitman's books ("The Aggressive Conservative Investor" or "Value Investing").
A Refreshing Look at Market Performance.......2006-07-11
There is no question stock prices climb and fall based on investors' current perceptions of their future performance.
Identify an error in those perceptions; you, as an investor, have uncovered a catapult to superior performance. In Expectations Investing, Alfred Rappaport and Michael J. Mauboussin argue current stock prices express investors' collective expectations. A change in those expectations lies at the heart of investment success.
This is a tall task. Approximately 75 per cent of all active investors deliver returns below those posted by passive index funds. The authors argue poor performance is built on a foundation of poor tool selection, high costs, and short-term vision and style limitations.
They argue investment performance can be improved by following three simple steps:
1. Estimate Price-Implied Expectations. Forget earnings and cash-flow estimates. Long-term discounted cash-flow models market performance.
2. Identify Opportunities. Expectation changes lead to changes in market evaluations. Whether you are looking at innovative technology or value, developed or developing markets, new or old economies, these principles are universal.
3. Develop a Disciplined Buy, Hold or Sell Strategy.
The ramifications of this discipline are they remove three misconceptions from investment thinking:
1. The market is short-term.
2. Earning per share dictate value.
3. Price-earning rations determine value.
This well-written and thought provoking book harnesses the market power of discounted cash flow without requiring difficult and dubious long-term forecasts. It helps the serious investor develop a theory of where he or she is headed, why and more important, the courage to ignore advice that has nothing to do with underlying value.
Is it just me.......2006-06-03
Seeing the other 5-star reviews makes me wonder, eihter those reviewers are clueless or I might have missed something big.
The main idea of the book is that if you can figure out the expectations incorporated in a market price and then evaluate the likelihood that (the more important of) those expectations may be wrong, you may actually find mispriced stocks and thus uncover good investment opportunities. Which I think is a nice idea, but is much easier said than done. The way the authors propose to proceed can be summarized as follows: (i) figure out from publicly available info and analyst reports the main consensus drivers such as sales growth, operating margin, cost of capital, etc., (ii) figure out what forecast period you need for a DCF model based on the consensus assumptions to produce the current market price of the stock, (iii)evaluate if any/which of the assumptions used in the DCF model are likely to be wrong, and based on that, (iv)make a buy/sell/hold decision. The reason this approach doesn't seem to add a lot of value to me is that it essentially consists of evaluating the assumptions used by other analysts (or other "consensus" numbers) to see if they make sense. This is what a lot of investors are already doing, except that it's a notoriously difficult task, and once you've gone through the pain of evaluating the main driving assumptions behind the consensus DCF, you are just a half-step away from building your own DCF anyway.
I'm giving the book 2 stars though for the pretty useful frameworks for thinking about drivers in a DCF model, and for being written in a fairly concise and articulate style.
Somewhat Basic.......2006-04-14
This is a good book for those new to investing or those who feel that they need a more fundamental grounding to their trading activity. If you are a regular reader of multiple business news sources and utilize that information to guide your trading activities, then I would pass on this book.
Book Description
To extend the teaching materials of Cost Management, 4e, this casebook provides additional cases and articles for each chapter, with the same teaching objectives as the text material. The longer cases found in this supplement help to facilitate more extensive discussion and analysis by students. The articles cover real world situations and have accompanying discussion questions. The overall purpose of the casebook is to help students develop analytical skills by organizing unstructured information in a case, devise appropriate analyses and draw appropriate conclusions. The articles provide examples of how actual firms have implemented cost management methods explained in the chapter, as well as show a perspective of how cost management methods are used in practice and the effects of using these methods.
Book Description
This reader contains thirty-nine recent business press and academic articles--all representing state-of-the-art thinking and examples on a wide variety of management accounting topics in many types of service and manufacturing contexts. Includes readings from many cutting-edge sources (e.g., The Wall Street Journal, Management Accounting, Journal of Cost Management, Harvard Business Review, and others) on topics in such areas as Management Accounting: Information That Creates Value. A Framework For Management Accounting And Control Systems. Cost Management Concepts And Cost Behavior. Traditional Cost Management Systems. Activity Based Cost Management Systems. Using Management Accounting Information For Activity And Process Decisions. Using Management Accounting Information For Pricing And Product Planning. Using Management Accounting Information For Investment Decisions. Management Accounting And Control Systems For Strategic Purposes: Assessing Performance Over The Entire Value Chain. Motivating Behavior In Management Accounting And Control Systems. Using Budgets To Achieve Organizational Objectives. Organizational Design, Responsibility Centers And Financial Control. For Cost and Management Accountants.
Customer Reviews:
Finally, a book that speaks MY language!.......2004-01-24
Financial books are typically jargon filled tomes that read like one accountant writing to another. Mr. Price has taken a normally complex topic and has broken it down into plain language and understandable examples. He even has made the whys and the wherefores understandable.
I recommend this book to anyone who feels in the dark about financial statements and what they really say or don't say. The book uses simple, understandable examples and uses a step by step approach to deciphering what are good numbers and what are bad numbers.
The glossary and appendices alone are worth the price of the book. I just hope this is just the first of many more business-made-simple by Ron Price.
Average customer rating:
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Readings in Management Accounting
Ibrahim Aly
Manufacturer: Kendall/Hunt Publishing Company
ProductGroup: Book
Binding: Paperback
 General
| Business & Investing
| Subjects
| Books
Management
| Accounting
| Industries & Professions
| Business & Investing
| Subjects
| Books
Management & Leadership
| Business & Investing
| Subjects
| Books
| Business Ethics
| Consolidation & Merger
| Decision-Making & Problem Solving
| Distribution & Warehouse Management
| Industrial
| Information Management
| Leadership
| Management
| Management Science
| Motivational
| Negotiating
| Operations Research
| Planning & Forecasting
| Pricing
| Production & Operations
| Project Management
| Quality Control
| Risk Assessment
| Statistics
| Strategy & Competition
| Systems & Planning
| Systems Analysis
| Teams
| Total Quality Management
| Training
ASIN: 0787203157 |
Book Description
In today's networked, highly competitive, and global economy, value is created collaboratively between a company and its stakeholders -- employees, investors, customers, suppliers, and communities. "The Stakeholder Strategy" presents a new approach to management that is focused on collaboration. It addresses concernes aobut the bottom line (can collaboration increase profits?) and societal pressures to improve overall quality of life. It also includes a practical step-by-step guide, which companies can use to forge a network of powerful and profitable collaborative stakeholder relationships.
Customer Reviews:
Highly Recommended!.......2001-06-02
Ann Svendsen’s critically acclaimed book is one of the first attempts to define a new relationship between business and its employees, customers and communities. Written in a conversational, intelligent style, The Stakeholder Strategy makes the case for collaborative stakeholder relationships and tries to show companies how they can develop and nurture those relationships for mutual benefit. Regardless of whether you think that Svendsen has succeeded or failed in that goal, the book gives plenty of examples, drawn from diverse industries, to support her claims. At the same time, it doesn’t get bogged down by endless source notes; the book provides just enough data to make a point and back it up. The book isn’t a flimsy how-to, nor is it a dry academic tome. It fits comfortably in the middle by incorporating the best of both approaches. We at ... recommend this book to company leaders and managers, as well as anyone — from life-long employee to adversarial activist — who falls under the new definition of a corporate stakeholder.
The Mansion In The Mist.......2000-10-12
I really enjoyed the book because it made me use my imagination. Set in the 1950s, in a mansion in another world, three characters are required to find a certain object. If they fail, creatures will invade the planet Earth. The story is told by Anthony Monday, the thirteen year-old protagonist, who starts the adventure by accidentally transporting himself to the other world. Once there, Anthony learns of the plot by the antagonistic creatures, who will stop at nothing to take over Earth. Together with the help of his friends, the Eells, the group searches for the solution that will prevent the creatures from reaching their goal. This conflict is decided just at the last moment. I liked this book because it makes the reader follow along and think of solutions to the many problems. Also, many surprises and suspenseful moments are found throughout the story. The only negative comment that I have about the book is that the discussion about the various solutions was too drawn-out. For readers my age, I would highly recommend this book because it was interesting and had a good plot. If you like the R.L. Stine books, this would be a great book for you to read because the authors are very similar. I would only recommend this book to teachers if they enjoy reading science fiction.
A framework for a holistic approach to stakeholder relations.......2000-06-13
This book is essential reading not only for community relations managers but for any corporate manager responsible for corporate strategy and for developing relationships with a company's key stakeholders. Svendsen provides a practical, easy-to-follow, step-by-step approach to all phases of building collaborative relationships. The book is filled with useful tools, practical tips, case vignettes and charts that summarize key points. The author discusses the critical role of both implicit and explicit "contracts" between stakeholders and companies and emphasizes relationship building as a corporate-wide responsibility. She sees reputation as critical to corporate success and trust as the most important ingredient in building positive stakeholder relations. And, she focuses on the importance of preparing an organization for relationship building by developing a social mission and creating structures and policies that support collaborative relationships with both external and internal stakeholders.
Average customer rating:
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Administracion De Empresas/ Business Administration: Libro De Actividades, Casos, Cuestiones Y Lecturas/ Book of Activities, Cases, Questions and Readings (Economia Y Empresa / Economy and Business)
Jose Diez de Castro , and
Carmen Redondo Lopez
Manufacturer: Piramide Ediciones
ProductGroup: Book
Binding: Paperback
General
| Accounting
| Industries & Professions
| Business & Investing
| Subjects
| Books
Management
| Management & Leadership
| Business & Investing
| Subjects
| Books
General
| Accounting
| Accounting & Finance
| Professional & Technical
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Spanish
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General
| Contabilidad
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| Gestión & Liderazgo
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Dirección Comercial
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ASIN: 8436809238 |
Product Description
The professional designation "Chartered Financial Analyst (C.F.A.)" is awarded to those candidates who have completed satisfactorily the examination and other requirements established by the Institute of Charted Financial Analysts. Normally, the candidate will be expected to pass three examinations: Investment Principles; Applied Secuirty Analysis; and Investment Management Decision Making. The main objectives of the examination series is to assure the investing public, employers, and fellow analysts that a CFA possesses at least the fundamental knowledge necessary to practice his or her profession. There are five basic subject-matter areas extending throughout the examination series: accounting, economics, financial anaylsis, portfolio management, and ethical standards.
Books:
- Financial Accounting: Information for Decisions
- Financial Markets & Corporate Strategy
- Financial Markets & Corporate Strategy
- Financial Reporting and Analysis (3rd Edition)
- Financial Statement Analysis: A Practitioner's Guide, 3rd Edition
- Financial Statement Analysis and Security Valuation
- Financial Statements: A Step-By-Step Guide to Understanding and Creating Financial Reports
- FLIP: How to Find, Fix, and Sell Houses for Profit
- Food and Beverage Cost Control
- Food and Beverage Cost Control
Books Index
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