Simple Analysis
I’m a big fan of reading body language. The other day I was talking to my neighbor, Warren. He grew up during the great depression and has a whole lot of street smarts that you just don’t find nowadays. He was a contractor for most of his life and he told me that he always knew whether you could trust a guy by looking at him. I think we forget about simple truths like trusting your gut as we are bombarded by the noise of EPS, FFO, 10Q’s, 10K’s and other gobbledygook.
Anyhow, Warren and I agree that sometimes you can just tell how trustworthy someone by looking at them. Certain people just have a look of dishonesty. For example, would you buy anything this guy is selling?
I wouldn’t! This is Angelo Mozilo, former CEO of Countrywide. I don’t know Mr. Mozilo but I just don’t trust him by the way he looks. Why? I don’t know - but people who invested in Countrywide at the wrong time are screwed. Maybe you think it’s prejudicial to make that kind of judgment but that’s what my gut tells me and I ain’t the first person to say it! Warren thinks so too.
The upshot is: sometimes when evaluating a company, the most important answer is in your gut - not in the jumble of noise that the feeders are feeding you. You get good information when you take a look at the CEO’s picture and ask yourself: “Do you trust this guy?” More often than not, this will be a very good starting point for deciding whether to put some dough into a company.