StableBread
@stablebread.bsky.social
Learn how to analyze, value, and manage your stock portfolio from the teachings of successful value investors.
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When value investing succeeds, it attracts everyone. Too many value investors eliminate the opportunities. People give up. Then it works again.
September 16, 2025 at 3:57 PM
When value investing succeeds, it attracts everyone. Too many value investors eliminate the opportunities. People give up. Then it works again.
Banks typically have a very small amount of equity to support their balance sheet.
Equity is important because it's the only cushion protecting depositors and creditors when loans go bad.
Equity is important because it's the only cushion protecting depositors and creditors when loans go bad.
September 12, 2025 at 1:03 PM
Banks typically have a very small amount of equity to support their balance sheet.
Equity is important because it's the only cushion protecting depositors and creditors when loans go bad.
Equity is important because it's the only cushion protecting depositors and creditors when loans go bad.
Yartseva's model using these factors successfully predicted 2023 and 2024 market directions.
While conservative, underestimating returns by 6.63% on average, it correctly identified every major turn and proved especially accurate during rising rate periods.
While conservative, underestimating returns by 6.63% on average, it correctly identified every major turn and proved especially accurate during rising rate periods.
September 10, 2025 at 12:57 PM
Yartseva's model using these factors successfully predicted 2023 and 2024 market directions.
While conservative, underestimating returns by 6.63% on average, it correctly identified every major turn and proved especially accurate during rising rate periods.
While conservative, underestimating returns by 6.63% on average, it correctly identified every major turn and proved especially accurate during rising rate periods.
Industry didn't matter either.
The 464 multibaggers came from every sector. Tech was only 20%.
Even traditionally slow sectors produced winners: Consumer Staples 6%, Real Estate 2%, Utilities 1%.
The 464 multibaggers came from every sector. Tech was only 20%.
Even traditionally slow sectors produced winners: Consumer Staples 6%, Real Estate 2%, Utilities 1%.
September 10, 2025 at 12:57 PM
Industry didn't matter either.
The 464 multibaggers came from every sector. Tech was only 20%.
Even traditionally slow sectors produced winners: Consumer Staples 6%, Real Estate 2%, Utilities 1%.
The 464 multibaggers came from every sector. Tech was only 20%.
Even traditionally slow sectors produced winners: Consumer Staples 6%, Real Estate 2%, Utilities 1%.
The study started from the 2009 market bottom and tracked companies for 15 years.
Yartseva tested over 150 variables to find what separated winners from losers.
She excluded temporary winners, focusing only on sustained 10x returns.
Yartseva tested over 150 variables to find what separated winners from losers.
She excluded temporary winners, focusing only on sustained 10x returns.
September 10, 2025 at 12:57 PM
The study started from the 2009 market bottom and tracked companies for 15 years.
Yartseva tested over 150 variables to find what separated winners from losers.
She excluded temporary winners, focusing only on sustained 10x returns.
Yartseva tested over 150 variables to find what separated winners from losers.
She excluded temporary winners, focusing only on sustained 10x returns.
The DCF's strengths and weaknesses explain why it's both the most respected and the most criticized valuation method.
Here's what makes it powerful, and what can lead you astray. 👇
Here's what makes it powerful, and what can lead you astray. 👇
September 8, 2025 at 12:56 PM
The DCF's strengths and weaknesses explain why it's both the most respected and the most criticized valuation method.
Here's what makes it powerful, and what can lead you astray. 👇
Here's what makes it powerful, and what can lead you astray. 👇
Peter Lynch, in "One Up On Wall Street," dedicates an entire chapter to discussing which types of stocks to avoid: 👇
September 5, 2025 at 3:58 PM
Peter Lynch, in "One Up On Wall Street," dedicates an entire chapter to discussing which types of stocks to avoid: 👇
Banks delivered 262% returns over 15 years.
Boring utility stocks with regulated monopolies returned 387%.
The S&P 500 nearly tripled banks at 690%.
High leverage. Inadequate returns. Systemic risk. Why would anyone own bank stocks?
Boring utility stocks with regulated monopolies returned 387%.
The S&P 500 nearly tripled banks at 690%.
High leverage. Inadequate returns. Systemic risk. Why would anyone own bank stocks?
September 3, 2025 at 1:00 PM
Banks delivered 262% returns over 15 years.
Boring utility stocks with regulated monopolies returned 387%.
The S&P 500 nearly tripled banks at 690%.
High leverage. Inadequate returns. Systemic risk. Why would anyone own bank stocks?
Boring utility stocks with regulated monopolies returned 387%.
The S&P 500 nearly tripled banks at 690%.
High leverage. Inadequate returns. Systemic risk. Why would anyone own bank stocks?
Let's examine three real examples from 2000 to 2010 using their acquisitions to CFO ratios (see the model):
September 1, 2025 at 1:00 PM
Let's examine three real examples from 2000 to 2010 using their acquisitions to CFO ratios (see the model):
Part 3: The Long-Term View
August 29, 2025 at 12:59 PM
Part 3: The Long-Term View
Part 2: Picking Winners
August 29, 2025 at 12:59 PM
Part 2: Picking Winners
Part 1: Preparing to Invest
August 29, 2025 at 12:59 PM
Part 1: Preparing to Invest
Dede Eyesan demonstrates this with solar energy.
26 outperformers directly benefited from the industry's rise between 2012 and 2022.
The solar value chain flows from raw materials to end consumers through four key stages.
26 outperformers directly benefited from the industry's rise between 2012 and 2022.
The solar value chain flows from raw materials to end consumers through four key stages.
August 28, 2025 at 4:00 PM
Dede Eyesan demonstrates this with solar energy.
26 outperformers directly benefited from the industry's rise between 2012 and 2022.
The solar value chain flows from raw materials to end consumers through four key stages.
26 outperformers directly benefited from the industry's rise between 2012 and 2022.
The solar value chain flows from raw materials to end consumers through four key stages.
Social proof bias happens when you follow the crowd into a stock, thinking others must know something you don't.
Just because many investors are buying doesn't mean they're right.
Popular stocks (like on this platform) can be overvalued--do your own research instead of copying others' trades!
Just because many investors are buying doesn't mean they're right.
Popular stocks (like on this platform) can be overvalued--do your own research instead of copying others' trades!
August 25, 2025 at 3:58 PM
Social proof bias happens when you follow the crowd into a stock, thinking others must know something you don't.
Just because many investors are buying doesn't mean they're right.
Popular stocks (like on this platform) can be overvalued--do your own research instead of copying others' trades!
Just because many investors are buying doesn't mean they're right.
Popular stocks (like on this platform) can be overvalued--do your own research instead of copying others' trades!
Using this realistic percentage, the probability drops to roughly 1 in 223,000 (calculated as 1/0.44^15).
But even this calculation understates the difficulty. Actual yearly data shows how difficult some years were for active managers (exhibit 7.2).
But even this calculation understates the difficulty. Actual yearly data shows how difficult some years were for active managers (exhibit 7.2).
August 21, 2025 at 12:59 PM
Using this realistic percentage, the probability drops to roughly 1 in 223,000 (calculated as 1/0.44^15).
But even this calculation understates the difficulty. Actual yearly data shows how difficult some years were for active managers (exhibit 7.2).
But even this calculation understates the difficulty. Actual yearly data shows how difficult some years were for active managers (exhibit 7.2).
Mauboussin examined this argument by calculating probabilities under different scenarios.
The table shows their mathematical reasoning (exhibit 7.1).
The table shows their mathematical reasoning (exhibit 7.1).
August 21, 2025 at 12:59 PM
Mauboussin examined this argument by calculating probabilities under different scenarios.
The table shows their mathematical reasoning (exhibit 7.1).
The table shows their mathematical reasoning (exhibit 7.1).
🧵 Most companies destroy value when they try to return cash to shareholders.
They consistently make the wrong choices between dividends, buybacks, and reinvesting in the business...
They consistently make the wrong choices between dividends, buybacks, and reinvesting in the business...
August 18, 2025 at 1:00 PM
🧵 Most companies destroy value when they try to return cash to shareholders.
They consistently make the wrong choices between dividends, buybacks, and reinvesting in the business...
They consistently make the wrong choices between dividends, buybacks, and reinvesting in the business...
Peter Lynch believed that every stock belongs to one of six categories.
Knowing which category a stock fits into can guide your investment strategy: 🧵
Knowing which category a stock fits into can guide your investment strategy: 🧵
August 9, 2025 at 4:00 PM
Peter Lynch believed that every stock belongs to one of six categories.
Knowing which category a stock fits into can guide your investment strategy: 🧵
Knowing which category a stock fits into can guide your investment strategy: 🧵
To truly understand management, you need to map out how executives reached their current positions. This reveals far more than a standard biography.
You should construct detailed career timelines for the top five managers using a combination of sources.
You should construct detailed career timelines for the top five managers using a combination of sources.
August 3, 2025 at 3:59 PM
To truly understand management, you need to map out how executives reached their current positions. This reveals far more than a standard biography.
You should construct detailed career timelines for the top five managers using a combination of sources.
You should construct detailed career timelines for the top five managers using a combination of sources.
Loss Aversion: When fear of losing money makes you avoid selling a stock at a loss, even when you should.
Losses psychologically feel more painful than equivalent gains feel good.
This is why investors hold losing stocks too long - the pain of realizing a loss outweighs rational decision-making.
Losses psychologically feel more painful than equivalent gains feel good.
This is why investors hold losing stocks too long - the pain of realizing a loss outweighs rational decision-making.
July 30, 2025 at 1:04 PM
Loss Aversion: When fear of losing money makes you avoid selling a stock at a loss, even when you should.
Losses psychologically feel more painful than equivalent gains feel good.
This is why investors hold losing stocks too long - the pain of realizing a loss outweighs rational decision-making.
Losses psychologically feel more painful than equivalent gains feel good.
This is why investors hold losing stocks too long - the pain of realizing a loss outweighs rational decision-making.
Then ranked each component, summed the scores, and converted to final EQ Score.
Results:
$BIPC scored 100 (highest quality)
$NJR scored 0 (lowest quality)
Results:
$BIPC scored 100 (highest quality)
$NJR scored 0 (lowest quality)
July 29, 2025 at 12:57 PM
Then ranked each component, summed the scores, and converted to final EQ Score.
Results:
$BIPC scored 100 (highest quality)
$NJR scored 0 (lowest quality)
Results:
$BIPC scored 100 (highest quality)
$NJR scored 0 (lowest quality)
Real example: I analyzed 13 U.S. gas utilities companies.
Began by calculating all six EQ components (excluded non-GAAP vs GAAP since reporting is inconsistent).
Began by calculating all six EQ components (excluded non-GAAP vs GAAP since reporting is inconsistent).
July 29, 2025 at 12:57 PM
Real example: I analyzed 13 U.S. gas utilities companies.
Began by calculating all six EQ components (excluded non-GAAP vs GAAP since reporting is inconsistent).
Began by calculating all six EQ components (excluded non-GAAP vs GAAP since reporting is inconsistent).
Here's what data you need to calculate the EQ Score.
All from standard financial statements - nothing special.
All from standard financial statements - nothing special.
July 29, 2025 at 12:57 PM
Here's what data you need to calculate the EQ Score.
All from standard financial statements - nothing special.
All from standard financial statements - nothing special.
But there's more. Wolfe Research tracks additional red flags that aren't in the score but signal trouble.
The more warning signs present, the lower the earnings quality.
The more warning signs present, the lower the earnings quality.
July 29, 2025 at 12:57 PM
But there's more. Wolfe Research tracks additional red flags that aren't in the score but signal trouble.
The more warning signs present, the lower the earnings quality.
The more warning signs present, the lower the earnings quality.
There are 7 components that predict earnings quality.
Each ratio is calculated on TTM basis - Wolfe found this more predictive than quarterly data.
Each ratio is calculated on TTM basis - Wolfe found this more predictive than quarterly data.
July 29, 2025 at 12:57 PM
There are 7 components that predict earnings quality.
Each ratio is calculated on TTM basis - Wolfe found this more predictive than quarterly data.
Each ratio is calculated on TTM basis - Wolfe found this more predictive than quarterly data.