Blucora, Inc. (BCOR)

[rudy-carter]

THINK like an owner:
Thanks to those that responded to me.. This company has a bright future. This is something that Bighead posted in a board, I thought it would be helpful to some.. Have a great day guys.
Think like an owner, a stock investor should focus on the underlying value of a business based on its long-term potential, not the daily market price of a stock. Although these concepts seem similar, there's usually a big difference. The actual value of any stock is equal to the present value of the future cash flows of the company, on a per-share basis. This value is obviously an estimate, because nobody knows for certain how much cash the firm will earn. However, I'm 100% certain that the true value of any given stock will fluctuate much less than its quoted market price does.

Share prices change for a variety of reasons, many of which have nothing to do with the firm's ability to generate cash. In other words, the price of any given stock is more volatile than the underlying value of the shares. This volatility is a blessing to stock investors because it occasionally provides some amazing opportunities to buy shares at prices well below what they are really worth. Famed investor--and mentor to Buffett--Benjamin Graham dubbed this cushion between the stock's price and its actual worth the margin of safety.

Often, the best opportunities to become an shareholder come when a firm is working through some temporary struggles that have little effect on the true value of the company, but the stock price has been hammered to prices that offer a large margin of safety. In many of these cases, thanks to the market's notorious shortsightedness, you'll find gloomy articles in the media, market pundits proclaiming doom, and naysayer analysts lowering ratings and price targets. It's at times like these that your HOMEWORK and ownership mentality will serve you well. You won't have the psychological comfort of knowing that there's a large crowd of people agreeing with you. Instead, you must stick to your convictions, and focus on the actual value of the firm, rather than the noise surrounding its share price. Quoting Warren Buffett, "Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing." Investors can cultivate the right temperament by thinking more like an owner.

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