In looking over the industries offered in this issue, I was disappointed. There were semiconductors, electronics, life insurance, and thrift banks. To date, I still do not understand how to value banks or insurance companies, and I am staying away from electronics (in general) as well as semiconductors. I ended up doing a cursory glance over every company and ended up analyzing only 2 of them. One is a great business:
- Aaon Inc- air conditioning & heating equipment
and the other is an interesting situation:
- NASB Financial- thrift bank in Missouri & Kansas
You may be wondering why I am posting about a bank if I do not understand them at all. I remember awhile back when Buffett talked about a certain profitability measure for banks and this one meets that requirement. It is also at a pretty good price to cash flow. I figure I’ll check it out and see if I can understand it at all.
UPDATE: NASB Financial got into mortgages & has pretty difficult-to-value assets on the balance sheet. I can’t necessarily take the numbers to mean what they’re saying… is it too much to ask for a simple S&L Bank that I can understand? Perhaps I’m not meant to understand this industry… Not interested anymore however.