Value Investing (second edition) by Bruce C. Greenwald, Judd Kahn, Erin Bellissimo, Mark A. Cooper, and Tano Santos
This is the long-awaited update to the original Value Investing book by Greenwald et. al. which was published many years ago.
The main addition to this edition has to do with calculating intrinsic value based on growth. This was described in the previous edition but has been greatly expanded and enhanced in this edition.
This book should be required reading for every serious value investor. It describes in detail a methodology for what is at the heart of value investing – figuring out what a company is really worth, no matter what the market price may be at the moment. The approach as described demands a lot in terms of really understanding the business and going deeper than just the financials – although a thorough understanding of those is definitely required. This much work and in-depth analysis may be intimidating to some investors, but as the authors say, it really helps you to be on the right side of the trade.