Roumell Asset Management just published it's 2Q 2017 investor letter with thoughts on deep value investing.
Roumell's deep value approach:
RAM mitigates the risk of buying unloved securities in several ways:
- Balance Sheet Strength—Provides time for investment optionality to play out and ability to average down
- Unique Assets—If the company cannot segue to profitability as a going-concern, the assets are desirable to competitors
- Multiple Shots on Goal—Like to have several ways to win, providing investment redundancy
- Alignment of Interests—Management and board incentives
- Price—Demand a sizable discount to our calculation of intrinsic value
The letter discusses three new ideas: Liquidity Services (LQDT), TICC Capital 6.5% 2024 notes, and Edgewater Technology (EDGW).