I felt some sadness when I hear about David Moyes' sacking yesterday.
I really expected Moyes to get more time and a chance this summer to form his own team. Assess him again next season but the bosses have other ideas.
Footballing matters aside, I observed 3 lessons that can be applicable to value investing.
Lesson #1 - Mind the Expectation Gap
You don't buy a small cap stock thinking that it can deliver the stable, steady performance & dividends like a mature big cap stock. At least not immediately.
But that is what happened to Moyes. He did not get the luxury of time despite the long contract signed.
How on earth would the Manchester United owners - the Glazers Family believe that David Moyes, a manager who never won a major trophy in top flight, to deliver the same lofty expectations??
So my fellow investors, it's ok to buy a Moyes stock for what it is....
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