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James Tisch On Value Investing – CIMA Keynote

James Tisch On Value Investing - CIMA Keynote via Columbia Business School

Thank you and good morning.

I’ve always wanted to start a speech off with the following Beatles quote – and today I’m gonna do it: “It’s wonderful to be here; it’s certainly a thrill.” I feel like I am an impostor who is taking my 21-year-old son’s job. You see, at the age of 18, when he was thinking of what he wanted to do for a career, he settled on the profession of keynote speaker. So here I am today, scooping his first gig.

For those of you who may not know, Loews Corporation is a diverse holding company, which owns six very different subsidiary companies – and not one of them sells lumber or shows movies. And while our six subsidiaries may vary, our business strategies are actually quite similar.

At Loews, our investment strategy is based upon analyzing economic variables of a particular industrial sector and then investing for the purpose of long term return on investment to our shareholders. Sounds simple – well, yes and no.

It is simple because we tend to look at investment opportunities using basic microeconomic principles, like supply and demand and, . . . It is not simple because -- as we all know -- investing in industries like energy can be highly cyclical and very risky.

I said that Loews tends to look for “long term” return on investment; we do that by seeking to acquire businesses that are temporarily undervalued and that have a strong senior management team. We then invest the capital necessary in order to achieve our goal of generating the highest possible returns on our equity investment. This is a strategy that’s been successful for us, and it’s the one that initially...