Title: Protecting Retirement: See How John Avoided a $500,000 Loss on Overvalued Stocks Tagline: How John, a 55-Year-Old Tech Exec, Used Margin of Safety to Avoid a $500,000 Loss on Overvalued Cloud Stocks Problem: John, approaching retirement with a significant portion of his net worth tied to $3.2 million in Restricted Stock Units (RSUs) from his tech company, was looking to diversify. He identified a high-growth cloud computing company that he admired and was tempted to invest a substantial $1 million, driven by recent positive press and projected future earnings. However, he was concerned about the seemingly high stock price relative to its current earnings and overall market volatility, especially given his relatively short investment horizon before retirement. He needed a way to determine if the stock was truly worth the investment or if he was overpaying based on its intrinsic value. Solution: John utilized Golden Door Asset's Margin of Safety Calculator to perform a deep dive into the cloud company’s financials. After carefully analyzing the company's financial statements and making conservative estimates for future growth, John determined the intrinsic value of the stock was significantly lower than its market price. The Margin of Safety Calculator revealed a negative margin of safety, indicating the stock was overvalued. Consequently, John decided not to invest in the cloud company. He instead diversified into a mix of value stocks with positive margins of safety. ROI: By using the Margin of Safety Calculator, John avoided a potential $500,000 loss. Several months after John's analysis, the cloud company experienced a correction due to missed earnings expectations and increasing competition, causing its stock price to plummet. Had John invested $1 million, as he initially planned, he would have lost approximately 50% of his investment. This preserved critical retirement funds. Description: Discover how a retiring tech executive utilized the Margin of Safety Calculator to identify and avoid investing in an overvalued cloud computing company, preserving his retirement nest egg. Learn how value investing principles can protect your wealth in a volatile market. Category: Client Service