Investors in Businesses
weekly 17 2025
I once read the quote: “Value investors are born, not made.” Unfortunately, I can't recall exactly where I read it or who said it. In the same spirit, Charlie Munger once said:
“While it might seem that anyone can be a value investor, the essential characteristics of this type of investor—patience, discipline, and risk aversion—may well be genetically determined.”
Seth Klarman put it like this:
“Value investing is at its core the marriage of a contrarian streak and a calculator. For some, this comes naturally; for others, it’s a struggle that never feels right.”
In other words, you either instantly grasp what value investing is about, or it never really becomes second nature. And that second nature is essential for getting through difficult periods.
I used to think that tough times meant watching your stocks drop by 25 to 50%. But last year I learned that it’s even harder to lag while others seem to make money effortlessly.
My focus is on the underlying businesses themselves: solid, reliable companies that generate profits. That helps me keep things in perspective when valuations fall from 10x to 8x earnings. Or when a cyclical company hits a rough patch, sees its profits cut in half, and its stock price drops even more. For me, that’s the only way to emotionally cope with such periods, and to put stretches of underperformance into the right context.
This week, I also read Investor AB’s quarterly report. The CEO opened with the quote:
“In these unpredictable times, I take comfort in knowing that Investor and our companies have weathered tough times before, and remain confident that trends such as demographics, automation, AI and the green transition continue to offer significant business opportunities.”
Reading that, you know that value investors are also at the helm at Investor. Perhaps more in the style of Munger and Fisher, with a focus on quality, and less like Graham or the younger Buffett, or myself, with a bit more emphasis on price.
The CEO also noted that, with so many moving parts, it’s impossible to accurately predict the exact impact on their businesses. The same goes for us. What matters is that all those companies are actively managing those uncertainties. And we, too, have to trust our managers—that they’ll respond to market changes in a timely and thoughtful way.
The term value investors has been watered down in recent years and is thrown around far too easily. Maybe it's time to opt for a clearer label: investors in businesses.
This week
On Tuesday, Lesson 10 of our introduction to value investing was published: Moats.
Next week, I'll be heading to Omaha on Wednesday morning for the annual Berkshire Hathaway meeting. Aside from the two travel days there and back, the trip includes four packed days of meetings, gatherings, and social events.
If you're also in Omaha, there's a good chance our paths will cross at one of the many events. Or feel free to reach out—I'd be happy to grab a Coke together somewhere.
I'll do my best to stick to the usual publishing schedule, but whether that works out depends on how much time there is between events and how reliable the Wi-Fi is on the flights and at the venue.
This week, we got Investor AB’s quarterly results. The rest can be found below in the ‘short news’ section. X-Fab's results, which were released this morning, will follow as soon as possible.