Dick Mayo, one of the most celebrated value investors in America was confused the continuous tendency to growth investment strategies of the New Economy. It examines the foundations of his philosophy, that in comparison to a growth-oriented approach by evaluating the long-term expected rate of return of more value and growth stocks. This case can be used to pursue several goals: (1) define the value and growth investing – where the differences are and whether one approach is superior to the other or whether both … Read more »

Dick Mayo, one of the most celebrated value investors in America was confused the continuous tendency to growth investment strategies of the New Economy. It examines the foundations of his philosophy, that in comparison to a growth-oriented approach by evaluating the long-term expected rate of return of more value and growth stocks. This case can be used to pursue several goals: to define (1) the value and growth investing – where the differences are and whether one approach is superior to the other or whether both merit and (2) to issues of consistency discuss their own investment philosophy. If you stay true to his philosophy, even though the market seems contrary to it for a longer period? Value investing can deliver value in this new economy, or is it just a concept Old Economy? The students will be asked to perform basic reviews of Cisco Systems (growth companies), CVS, RR Donnelley and Manor Care (value companies), and calculate its long-term return expectations. The case comes with an Excel spreadsheet with the data and relevant valuation ratios for the above mentioned companies. The reviews are simple, but they tell an interesting story: the expected returns on stocks glamorous in reality may not be as glamorous
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This is a Darden case study.
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from
Giorgos Allayannis,
William Burton
Source: Darden School of Business
16 pages.
Publication Date: Aug 13, 2001. Prod #: UV0090-PDF-ENG
GMO: The Value Versus Growth Dilemma HBR case solution