By Alec Hogg
I just love stocks that reward patience. Because there seems to be so little of it in this speeded up world. My favourite are companies taking strategic bets, the long-term decisions Mr Market just hates. These investments often require conviction and the occasional dose of stamina. But the reward is often handsome.
Photo credit: Kansir / Foter / CC BY
A recent example is IBM which we bought in December 2014 when launching the Biznews Global Share portfolio. I loved it that the world’s dominant computer hardware business was boldly refocusing into new growth areas. At our purchase price of $162.50, the shares delivered a good margin of safety (my intrinsic value is over $200) – plus we were paying way less than $170.50 at which Warren Buffett had invested $13bn. IBM is one of Berkshire’s Big Four holdings.
It hasn’t all been plain sailing. A year ago, IBM’s share price bottomed at $121. That brought newspaper headlines shouting about Buffett’s investment “losin...