1. Portfolio Update January 31, 2017 Jeffrey Lorden
Investment Management Academy

2. Current Holding: Flexsteel Industries (FLXS)
Long 500 shares
Cost basis of $
Purchased on 11/5/2015
Recommendation given by Michael Migut & Ari Lazar
Gave Fair Value of $56.58
Currently trading at $51.20
Current Holding: Flexsteel Industries (FLXS)

3. Value Investing Might be asking: why only 1 holding?
“The stock market is a no-called-strike game. You don’t have to swing at everything – you can wait for your pitch” – Warren Buffett
“It’s far better to buy a wonderful company at a fair price, than a fair company at a wonderful price” – Buffett
Value investors wait for a great company, selling for a decent margin of safety to the estimated fair value
Don’t swing at GOOD pitches, wait for the GREAT ones!
Value Investing

4. Ben Graham’s Mr. Market Actual Business Cycles (good year, bad year)
Market Price (over- and under-optimism)
Ben Graham’s Mr. Market

5. "Basically, price fluctuations have only one significant meaning for the true investor. They provide him with an opportunity to buy wisely when prices fall sharply and sell wisely when they advance a great deal. At other times he will do better if he forgets about the stock market.“ – Ben Graham
Ben Graham

6. Manufactures and sells wooden & upholstered furniture
Market Cap: $419 million (small-cap)
Sells entirely within US
2 Segments: Residential & Commercial
Products include sofas, tables, desks, rockers, chairs, etc…
For entire pitch, see: Research.aspx?Cat=Portfolio
Flexsteel Overview
Source: Bloomberg

7. Performance
Source: Yahoo!Finance

8. Company News Why the huge dip in October 2016? (lost 19%)
Reported 1Q Earnings
Lowered guidance for CapEx
Revenue was down 11.4% year over year
Forecasted weak demand
EPS was down year over year
Why the quick recovery? (spiked 45% in month following election)
Trump rally
Expecting fiscal policies will boost growth
Company News
Source: Bloomberg

9. Company News Why the recent decline?
Over-optimism?
Correction to more reasonable levels?
Lost 8% since 1/25/2017
Will report 2Q results ending 12/31/2016 on February 2,2017 (after market closes)
Expect some volatility as FLXS has been volatile around earnings
Someone else quick update?
Company News
Source: Bloomberg

10. Performance As of 1/23/2017… FLXS S&P 500 Russell 2000
Price Return: 23.04%
Total Return (including dividends): 25.49%
Annualized Return: 20.47%
S&P 500
Total Return: 10.63%
Russell 2000
Total Return: 15.14%
Performance
Source: Bloomberg

11. Keys to Success (At Time of Pitch)
Source: Bloomberg

12. Keys to Success (At Time of Pitch)
Source: Bloomberg

13. Keys to Success (At Time of Pitch)
Source: Bloomberg