Value Investing in 2005

There is nothing in this world like finding a good value. It doesn’t matter whether you’re buying a car, shopping for antiques, or investing in a security. Finding a great value just makes you feel a whole lot better.

As I continually scour the stock market for moneymaking opportunities, I often find great companies, but believe they are expensively priced on the stock market. There’s no question that there is an element of “you get what you pay for” in the investment business, but buying a high-priced stock makes you much more vulnerable to the broader market’s swings.

One company that I recently came across seems to offer really good value on the stock market. The company is called Kforce Inc. (NASDAQ/KFRC). This company is based in Tampa, Florida and is a professional staffing firm providing temporary and permanent staff to the technology, finance, accounting, and health science industries. The company has about 83 offices in 45 markets in North America.

In my view, the stock is very reasonably priced on the stock market, perhaps because it is not that well known in the investment community. The company has turned itself around after experiencing some tough times from 1999 to 2003. Now, it seems to have honed its business plan and is growing profitably.

I really like to find reasonably priced stocks on the market, especially when there isn’t much of a tailwind in the broader market. I also really like see turnaround situations. When a company experiences operating trouble, investors normally jump ship very quickly. But very often, a great entry point presents itself to those investors who are watching and waiting.

If a company learns from its mistakes, then hones its business plan accordingly, it very often can return to profitable growth. This is exactly what Kforce Inc. has done. Only, the marketplace doesn’t seems to recognize its newfound success. Here, seemingly, lies opportunity for the value conscious, alert investor.