"Cigar butt trade"

[El Presidente]

I saw this terminology in an article this morning and thought it worthy of further investigation. 

 

A "cigar butt trade" is a term used in investing to describe a strategy where an investor purchases a stock that is trading at a significant discount to its intrinsic value, often because it has fallen out of favor with the market or is experiencing temporary difficulties. The idea is akin to finding a discarded cigar butt on the ground: it may be battered and almost used up, but there's still one last puff left in it.

 

[99call]

The people trading in Churchill's 'supposed' cigar butts. Seem to be doing a roaring business. I think they average about 50 a year.

[Drguano]

Sigh, I was expecting something along these lines...

[BrightonCorgi]

How about a few good stocks that fall into this category? Tesla has dropped some to a level that is worth a look.