Having worked as a banker for more than 10 years before entering the investment world, Christopher Mayer has a simple thesis behind his book Invest Like a Dealmaker: Secrets From a Former Investment Banking Insider. Essentially, there are two markets for publicly-traded companies. The first, and most widely known, are the stock prices that are available instantly. The other, lesser-known market is the value that these same companies might have to a private buyer. By focusing their research efforts on the latter and using stock prices only as opportunities to buy and sell when it’s advantageous, Mayer believes that investors can achieve better results with less stress.

Many readers will be disappointed that Mayer never really takes the analysis much farther than that. He includes some very helpful tips for finding undervalued stocks — look at enterprise value to ebitda

ratios, book value and other metrics unappreciated by most investors — but there is really not much in here about dealmakers, the world of private fairness, etc.

That said, that is a very pleasing little book. Mayer has obviously read pretty extensively about investing, and much of the book consists of odes to the ideas of others. He relates many great anecdotes and quotes from some great investors, and a lot of them are obscure sufficient that even those who have read about value investing a lot wouldn’t have heard them yet.

Invest Like a Dealmaker is nearly nothing like what the title would propose, but it still belongs on the bookshelf of the serious value investor.

Original post by Zac Bissonnette

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