Mellody Hobson Quotes

I found an approach to investing that made enormous sense to me: rigorously analyzing a company's fundamentals, understanding exactly how it makes money, developing a view on the business's future prospects, and deciding if it's a good business.

The essence of a good investment manager is one who studies a given business and extrapolates the future cash flows that the business is likely to generate over the next several years. Based on the cash flow and asset assessment, they can then arrive at their expected rate of return if they bought a fraction of that business at a given price.

The market is often stupid, but you can't focus on that. Focus on the underlying value of dividends and earnings.

I have always believed that a single talented analyst, working very hard, can cover an amazing amount of investment landscape, and this belief remains unchallenged in my mind.

Internally, when we manage portfolios, we figure out what works in large cap, what works in mid cap, what works in small cap. Generally speaking, large cap stocks want earning stability, strong cash flow, margin expansion.

Whenever you hear a discussion about the short-term swings in any given stock's price, your immediate thought should be whether it matters to why you are investing.

What we do is we test what works on Wall Street. And sometimes it is earnings momentum, and sometimes it's earnings surprises. Sometimes it's price-to-sales cash flow, and then we put together our stock selection models.

When buying shares, ask yourself, would you buy the whole company?

I've never met him, but I love the simplicity with which Warren Buffett describes good and bad businesses and how he makes his investment decisions.

The key thing when you short is to make sure you're not wrong on the fundamental intrinsic value.

I'm a very commonsense guy - I just look at the viability of the idea, if I feel the team has the ability to execute the idea. I also look at the investment syndicate, the size of the market, and then a lot of gut married on top of it.

There are two ways to approach the market. You can guess which direction prices will go in next, or you can figure out what businesses and their securities are really worth.

When you see a 'Shark fight' erupt, we aggressively want to understand what we are committing our money toward.

Assessing management quality is clearly one of the most important aspects of an investment decision.

We call ourselves 'opportunistic value investors.'

The concept of paying one-hundred-and-something times earnings for any company for me is just anathema. Having said that, at the end of the day, your job is to buy what goes up and to sell what goes down so really who gives a damn about PE's?

The critical investment factor is determining the intrinsic value of a business and paying a fair or bargain price.

Knowledge is only one ingredient on arriving at a stock's proper price. The other ingredient, fully as important as information, is sound judgment.

If you buy something because it's undervalued, then you have to think about selling it when it approaches your calculation of its intrinsic value. That's hard. But if you buy a few great companies, then you can sit on your ass. That's a good thing.

All intelligent investing is value investing - acquiring more that you are paying for. You must value the business in order to value the stock.

A startup job is an investment, after all: Venture capitalists may wager money, but you're staking something more precious - your time. And unlike VCs, you can't spread your risk by betting on a bunch of companies at once. Start with TAM. That's 'total addressable market,' and if it's not big enough, there's no point in talking.

When high-growth companies slow down, growth and momentum junkies often sell indiscriminately, which can create great opportunities for value investors. Just be careful not to anchor on the stock's previous price or earnings multiple, which are no longer relevant.

The consequences of overestimating a company and your ability to analyse it are greatly diminished when you're paying a lot less for it than your analysis shows it is worth.

I try to buy shares of unpopular companies when they look like road kill and sell them when they've been polished up a bit.

Understand that VCs are simply a sophisticated form of financial investors who, in turn, need to satisfy their own investors.