Amit Wadhwaney: ’Buying Cheap Has a Number of Attractions’

In this episode of The Long View, host Ben Johnson and portfolio strategist Amy Arnott welcome Amit Wadhwaney, co-founder and portfolio manager at Moiris Capital Management, to discuss his three-decade journey in value investing. Wadhwaney recounts how his interest in investing began accidentally—through a combination of economic curiosity, a fortuitous real estate purchase during Quebec's 1980 separation referendum, and a transformative encounter with Marty Whitman’s investing philosophy. He emphasizes that his approach centers on buying deeply undervalued businesses with strong survivability, meaning they can endure economic shocks, regulatory changes, and cyclical downturns. His firm, Moiris, is built around a narrow focus on deep value investing, avoiding sectors prone to structural risks like overcapacity or excessive government interference. Wadhwaney shares how trouble—whether from poor management, overexpansion, or macroeconomic crises—can create rare opportunities, citing Natura Cosmetics and oil service firms like Tidewater and Valaris as examples where disciplined investing led to outsized returns through asset sales, spinoffs, and acquisitions. He argues that value investing is not about predicting commodity prices or market trends, but about identifying businesses that are cheap relative to their intrinsic value and capable of generating returns over time through operational improvement and capital allocation. Despite the current market's obsession with AI and growth stocks, Wadhwaney remains optimistic, noting that the decline of value investing has created a fertile environment for contrarian opportunities, especially in overlooked markets and distressed but fundamentally sound businesses. Key takeaways include: (1) Buying cheap is not just about low prices—it's about acquiring businesses below their intrinsic value, especially those with strong balance sheets and resilient business models; (2) Troubles in a company’s history—such as mismanagement or overexpansion—can create rare opportunities for value investors if the core business remains intact; (3) Value realization often comes not from holding stocks forever, but through corporate actions like asset sales, buybacks, and spinoffs, which are byproducts of disciplined investing; (4) Survivability—defined as a business’s ability to endure adversity—is more important than short-term profitability or market sentiment; (5) The current market concentration in tech and AI is a classic sign of a potential value opportunity, as the decline of value investing has reduced competition and expanded the pool of undervalued assets. Wadhwaney concludes that patience, rigorous analysis, and a focus on risk avoidance are the true engines of long-term investment success.