The Disappearance of Primary Ownership Reasons

We are required as analysts to present five, six or seven key reasons to own a stock, and if any of those start to erode, that’s a warning sign that often leads us to sell. For example, we have tended in the past couple of years to overestimate the intrinsic-value growth in media companies. As we scale those estimates back – taking away a primary reason for our owning them – we should be selling.