Uncovering Hidden Gems: Inside the Investment Strategies of Market-Crushing Manager Bob Robotti

Renowned investor Bob Robotti has been making waves in the market for over three decades with his exceptional returns that have far surpassed the S&P 500. His Ravenswood fund, established in 1992, has seen nearly a 100-fold increase, showcasing his keen insight and patient strategy.

In a recent interview with Business Insider, Robotti shared his unique approach to finding hidden gems in the stock market and discussed common pitfalls that investors often encounter. He also delved into one of his most successful trades, shedding light on his investment philosophy and strategies.

Robotti’s investment philosophy is deeply rooted in the value boom of the mid-1970s, where he believes that markets are inefficient, leading to stocks being mispriced. This presents opportunities for active managers like himself to capitalize on undervalued companies and generate substantial returns.

“I am not a value investor — I’m a growth investor. I am looking at businesses that have significant growth from a cyclical recovery and a depressed business,” Robotti stated.

His strategy revolves around identifying undervalued companies and patiently waiting for their rebound. Robotti emphasized the importance of focusing on the economics of a business, as that ultimately drives stock prices.

One of Robotti’s best trades was with Tidewater, an oil services firm based in Houston. When he joined the board in June 2021, the stock was trading at around $14 per share. Fast forward three years, and it’s now trading for over $90.

Despite Tidewater’s success, Robotti remains committed to the long term, emphasizing the importance of holding onto investments even as they appreciate in value.

Robotti’s insights into the market and his successful investment strategies continue to inspire and educate investors looking to navigate the complex world of finance.