Robotti & Company is a New York deep-value boutique founded by Bob Robotti in 1983, specializing in left-for-dead cyclical industries — energy services, building products, shipping — with multi-year holding periods and occasional activist letters. It manages about $650m; Bob is regarded as one of the most steadfast Graham-tradition cyclical value hunters.
This article compares today's hype around 'unicorn' companies (private firms worth over $1 billion) to historical bubbles like the Dutch tulip mania and the dot-com crash. The author argues that many investors confuse speculation with investing, chasing trendy stocks while ignoring solid, old-economy businesses like industrial and healthcare firms. For regular investors, the takeaway is to avoid overpriced hype stocks and focus on undervalued companies with real cash flows, then wait patiently for the market to recognize their worth.
The Robotti report draws parallels to the 1633 Dutch tulip mania and the late-1990s internet bubble, arguing that the current market is experiencing a new "unicorn" bubble—private companies valued at over $1 billion. As of early 2019, there were more than 300 unicorn companies globally, with 26 forc
This chapter draws historical parallels with the 1633 Dutch tulip mania and the late-1990s internet bubble, arguing that the current market is experiencing a new "unicorn" bubble—private companies valued at over $1 billion. As of early 2019, there were over 300 unicorn enterprises globally, with 26 forced into IPOs in 2018 alone. The author emphasizes that during bubble periods, speculation and fundamental investing are often conflated; early investors may profit, but latecomers chasing trends often lose everything.
The author's core investment argument is that the current market is confusing speculation with investment, particularly in the unicorn space, where many companies are not going public voluntarily but are forced into public markets because private markets have no buyers. Counterintuitive judgments include: although value investing has been declared "dead" by the market, it is precisely this pessimism that creates opportunities; investors' frenzy over "virtual" assets leads to undervaluation of "physical" assets, which are the foundation supporting the former.