Tweedy Browne's John Spears and Jay Hill on value investing and insider buying | S08 E17
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I think we're live. This is Value After Hours. I'm Tobias Carlisle joined as always by my cohost, Jake Taylor. Very special guests today, Tweedy Brown, Jay Hill, and John Spears. Welcome.
Good to be with you, Rob. Thank you for having us.
Thanks for having us, Tobias and Jake.
Tweedy really needs no introduction. But, John, perhaps you could tell us a little bit about the history of Tweedy.
Sure. The the firm was founded in 1920 by Forrest Burwell Tweedy. It, had a specialty of making markets and inactively traded securities way before your time, Tobias, your time, Jake, there were the pink sheets. And that would show all the the market makers and specific stocks. And the and the the buying and selling of stocks was done by looking in the pink sheets, who's the market maker and Smith manufacturing. If Tweedy was the market maker, we might say we'd buy a 100 shares at ten, and if you want to buy them from us, we'll sell them to you at $10.5 So that's how the firm got going. And on
That's perfect. The investment philosophy, is traditional deep value, and it's continued to be traditional deep value to this stake. Perhaps you could talk to us a little bit about what that means and how you express that?
I would say the big idea, and this was really Graham's idea, is that there's two prices to every stock. Right? There's the price that we can all see every day quoted in the stock market, the stock price. And then there's the intrinsic value of the business, with the intrinsic value being defined as what would that business be worth if a 100% of the company were sold in an arm's length transaction to a knowledgeable buyer? Right? The intrinsic value. And I can say that that, I started at Tweedie Brown in 2003, and the process has really been around trying to identify companies trading at 70% or
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