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What Is Meant by "Value Investing"? Is It Consistent with the Efficient

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Essay

What is meant by "value investing"? Is it consistent with the efficient markets hypothesis?


Definitions:

Net Realizable Value

The estimated selling price of goods minus the costs of their sale or disposal, used in inventory valuation and accounts receivable.

Write-Down

A reduction in the book value of an asset when its market price falls below its carrying value on the balance sheet.

Gross Profit

The difference between revenue and the cost of goods sold, representing the basic profitability of the products or services sold by a company.

Pretax Income

The income of a business before income taxes are deducted.

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