THE irony couldn't have been lost on the 350 people who gathered for the Value Investing Congress West in Hollywood last week.
Normally, a crowd is exactly the last place a serious value investor wants to be. True value typically is found in investments that are hidden gems, things that are underappreciated and relatively unwanted.
But in today's streaking stock market, there's very little that no one wants. And that's the problem for the value camp.
Shares of Contango Oil & Gas Co., a small Houston-based exploration company, have soared 75% since mid-March -- including a 5% price jump on Tuesday after the stock was mentioned by a fund manager at the value congress.
Real value investors are supposed to do extensive homework, digging deep into a company's income statement and balance sheet. They also tend to abhor chasing hot stocks.
"I'm sure you've all done your due diligence," joked Whitney Tilson, a co-founder of the conference, as he opened the afternoon session on Tuesday and noted the moves in some of the stocks mentioned just hours earlier.
This is no knock on Contango or the value get-together, the second annual such conference held in L.A. For all I know, Contango is a future Exxon Mobil Corp. And even Warren Buffett, the most revered living value investor, gathers his acolytes once a year (at the annual meeting of his investment company, Berkshire Hathaway) to talk ideas.
The fund managers, professional analysts and individual investors who paid the $3,695 standard rate to attend the value congress surely didn't do so to hear whining about a lack of good stock choices. They came for names and numbers.
Still, the cloud that hangs over any meeting of value-minded investors these days is the sense that pickings are slim in the fifth year of the global bull market.
Most people with money in stocks take joy in this spring's ongoing rally. Not so Steven Romick, manager of the value-focused First Pacific Advisors Crescent mutual fund in L.A.
As he puts it: "My wife says, 'How come all the other people are happy and you're not?' "
His $1.4-billion fund has more than 40% of its assets in cash -- an unheard-of sum for most stock fund managers. He's sitting on his hands rather than giving in to the temptation to reach for stocks that are out of his value range, he said.
"People are being scared into stocks -- it's fear of missing out," says Romick, who spoke at the conference.
