Many value investors get caught in the trap of looking purely at company multiples when picking stocks. However, one well-known investor explained the importance of considering both the multiple and potential for growth.
Between a rock and a hard place
At the recent Capstone Student Investment Conference, Dan O’Keefe of Artisan Partners compared value investing with Odysseus’ journey home in Homer’s The Odyssey.
O’Keefe started by saying he didn’t study economics or finance; he majored in philosophy and literature. He chose to talk about the whirlpool and six-headed monster on each side of the strait which Odysseus had to pass through on his way home.
In other words, he was between a rock and a...
