What is The Value Road?

I started The Value Road to write high quality investment research on off the beaten path stocks.

Stocks so far off the beaten path that almost no one else is talking about them

Stocks that no major hedge fund or anyone managing a significant sum of money could invest in.

Nano-cap and micro-cap value stocks. The best place in the market to find real value and generate significant alpha.

But I don’t invest in just any nano-cap. I look for companies with a significant margin of safety.

A margin of safety so large that if I am wrong in my forecasts then I won’t lose much.

A heads I win, tails I don’t lose much, mentality.

As a background on my investing style, I describe myself as an extreme value investor.

I invest in companies selling for a steep discount to liquidation value.

I look for companies with low price-to-book, price-to-sales, price-to-earnings, price-to-FCF, EV/EBITDA and other traditional measures of value.

To control risk I focus on companies with low net debt and asset heavy industries. If there is real estate that can be liquidated or sale-lease-backed I am thrilled.

My emphasis on nano-cap and micro-cap stocks is because the market is very inefficient in valuing them, as both institutional investors and brokerages increasing shun them.

In addition, I am an extreme contrarian. I like to invest in the most unloved and hated industries. The more out of favor the better.

If an entire industry is undervalued I tend to allocate a significant sum of my portfolio to the sector as undervaluation is undervaluation, and out of favor sectors don’t stay that way forever.

I search for stocks in an untraditional way, by going A to Z and reading as many annual reports as I can.

I tend to think stock screeners are a good start to finding ideas. But everyone is using a stock screener to find stocks.

So I download lists of OTC stocks and go one by one through their annual report until I find something interesting.

That is how I found a luxury hotel company trading at an 18-cap, with 5,500 acres of owned land and significantly below replacement cost.

It is also how I found a company with a $14 million market cap, almost zero net debt and a real estate listing where the company was selling one of their assets for $27 million.

I also found a company running strategic alternatives, with undervalued real estate trading 50% below NAV and a billionaire Israeli purchasing the stock in significant size using tender offers.

Or a company trading around 1x earnings that comes with a possible $19 million payout. By the way this company had a market cap of $1.6 million when I found this gem.

Occasionally, I also write about higher quality larger companies because they get so blown out by the market.

• Like Dollar General.

• Or Gray Media.

• And even Kohl’s.

If you can’t tell already, I love finding undiscovered gems.

It is my passion to find stock ideas that no one else is looking at.

And then potentially making money on them.

Thanks again for becoming a free subscriber.

If you are interested in my research consider becoming a paid subscriber and you can get access to all of my previous research as well as anything I writeup in the future.

Also if you want a free research report, message me, and I will send one to you.

I am looking forward to interacting with all subscribers and if you ever have any questions feel free to reach out to me.

Feel free to follow me on X. I post a lot of stuff on there too!