Value Investing In Your Car Episode 19 – Why Synergy Is Useless

In these Value Investing In Your Car Episodes, we talk about mental models, when does value investing work best, where it works, you get book reviews, the most important thing I learned in 2017, how to learn faster, useless investing metrics, and much more…

If you want to learn from the other episodes in this series you can watch the entire playlist here.

In this week’s video, we finish up this mini-series, within this larger series, about the four most useless value investing and financial metrics and terms.

1. Here I detailed why P/E is useless.
2. Here I detailed why beta is useless.
3. Here I detailed why 99.9% of the time goodwill is useless.

And today I tell you why 99.9% of the time, when you hear or see the term synergy and company management – are useless.

Let’s get to it…

In the 11 – minute video above, I detailed the following reasons why like P/E and beta, and goodwill before it, synergy is almost completely useless.

• Why it’s useless 99.9% of the time
• The 0.1% of the time it isn’t useless and why it’s so rare to find useful goodwill
• Why managers use the word synergy
• What its supposed to mean and lead to
• Why it mostly doesn’t lead to anything good
• And more…

What are your thoughts on synergy? Does it scare you when you see it from managers like it does for mre?  Do you like seeing about potential synergies? Let me know in the comments below.

For more in-depth info on synergy here is an article from Investopedia talking about it.

P.S. If you’d like to learn how to value and evaluate businesses like a world-class investor, check out our three programs that can help you do this…

Our Value Investing Training Vault, our Value Investing Masterclass, and our $10,000 Coaching Program.

P.P.S. I’m giving away FREE copies of my acclaimed value investing education book, How To Value Invest. To get your free copy, go here.