Current Thinking: Income Strategy
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Deep Value Strategies
Channeling Benjamin Graham: Buying a Dollar of Value for Less than 50 Cents
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Undervaluation is not determined by a stock’s price in relation to existing or trailing earnings, book value, or cash flow, although these metrics may be evidence of a price that is below intrinsic value. Undervaluation is determined by the relation between a stock price and the present value of the free cash the underlying business will generate over one’s forecast time horizon. Bill Miller, CFA September 1999