Price being what we pay, and value being what we get for the price paid, it is helpful to consider the four options:
Low price, high value.
High price, high value.
Low price, low value.
High price, low value.
Regarding FA and TA... FA can inform us about the value. TA tends to inform us about the price. Until this distinction is clear for ourselves, there will be that lingering ambiguity and confusion whille relying on FA or TA for LT investment.
We all know the price. But do we know the value? And if we do not know the value, how do we know that the price is high or low? And do we know how to determine the value by using a rational method without relying on (or falling prey to) irrational impulses manipulated by various players with less than noble agenda?
A good start is to read and reread the independent consultants' reports, and the quarterly reports issued by reputable management. A bad start is to read and fall for the unsubstantiated claims made on HC by well-known shills and trolls. Accepting the fact that Rome wasn't built in a day also helps temper expectations.
Then there are some the big picture settings... Setting 1: The Marxist criticism of the crisis of capitalism: "Excessive production as a consequence of greed and inadequate demand, leading to economic failure".
With its adopted communist ideology, China knows this criticism only too well. Hence China exploits this weakness of capitalism with good short-term successs, as seen in the one-or-two-year adverse impacts on the prices of coal, iron ore, lithium, nickel, basically every resource that country needs.
But what China might have underestimated is that the West also studied and analysed Capitalism and Marxism in great detail. The pros and cons of both politico-economic systems are well known, and there are countermove strategies available.
Furthermore, China too has fallen into the trap of the crisis of capitalism. Where there is human nature, there is greed. Which is why we see the collapse of China's construction industry in the form of ghost cities and tofu buildings, and the unsustainability of its state-subsidised cheap and low-grade Li, Ni, coal and FeO mines.
Domestically, China's disaffected youths with their "lying down" and "letting it rot" mindsets is an increasing unemployment or productivity challenge for the leaders. Seems like these are China's equivalent to the West's wokeness and DEI culture. It was said to have infected even the shadowy realm of the CIA.
In this context, a company with excellent staff culture and milestones progressiveness are definite pluses on which we can place high values.
Setting 2: Empires without citizenry, only shareholders... Yes, the likes of GS, JPM, MS, Blackrock, Tesla, SMM, MC, etc.
The everyday retail investor liking them or hating them has no effect on the way they operate. Much the same as liking or hating the city-states of London, Washington DC and the Vatican. In their eyes, we as individual consumers are almost inconsequential. They respect us as a collective, not as individuals.
Their number one MO is financial profit, upon which the other two MO of governance and sustainability rest. Without number one, the empire does not exist to uphold the other two. Much has been complained about the obvious ongoing pattern of the BEOT recommending to buy while they sell and vice-versa. Since when have the KPIs of profitability, governance and sustainability been barriers to double-speak?
The BEOT are highly educated, have vast intel and wide collaboration networks. Don't make $'billions by being under-resourced or a simpleton. They KNOW about the crisis of capitalism; and where none exists, the conjuring of one, and how to capitalise on the crisis for huge profits. Feeding an idea into the collective minds using unrelenting repetitions is one of their tactics. Tried and tested mass psychology 101, followed up with double-speak.
Question to ask ourselves:
If the BEOT sees good value in an investment, must they then invest immediately? What if their intel informs them that there is enough time to drive the price further down before acting?
Does the everyday retail investor want to outguess/gamble against/outsmart the BEOT? Or is it financially better and more prudent to be a year early than a day late?
Setting 3: The useful idiots for the BEOT. Yes, we know about them. Maybe they don't actually know that they have been used by the BEOT. 'Nuff said.
Looking at the overall picture: The question we might ask ourselves is: "How and where does ARL's potential stand?" The answer that we discover for ourselves tells us much about our own critical analysis skills.
ARL Price at posting:
47.5¢ Sentiment: Buy Disclosure: Held
(20min delay)