Beating the Street Paperback – May 25, 1994

Great book that is easy to read and has great advice from psychology of the market to how should interpret a balance sheet. Highly recommend the read

This is the second most helpful book on stock investing I've read. The first isn't 'One Up on Wall Street' by Peter Lynch, but I'll come back to that later.This is an old book, and I am writing this review because I have the exact opposite opinion of that presented in one of the most helpful reviews of this book. This book is neither impractical nor outdated. And, unlike the first book 'One up ...', this isn't a feel good book that will show you how to use 'what you already know' to make money. Meaningfully beating the stock market is really hard.I first read this book sometime before the financial crisis of 2008-09, and went back to it several times for guidance on banks that were selling at very low prices during and after that episode. It is worth mentioning here that the section on valuation of Savings and Loans isn't in the chapter with the term 'S&L' in its title; it's in the previous chapter titled 'It's a Wonderful Buy'. From this book I learned about the importance of the Equity-to-Assets ratio. The metrics used to evaluate banks have not changed. Equally important was reading about past real estate and banking crises, and accepting that it is normal for these things to happen every few decades. Hearing about history, especially through the account of someone as experienced and knowledgable as Peter Lynch, is a rare privilege. It offers perspective, and acts like a bridge that takes one from worrying about uncertainty to seeking return in risk.In summary, doing one's homework is important in order to excel at anything that others are also doing. This book has been like a cheat sheet to help with my investing homework. The only book I've found richer in ideas for beating the market is Joel Greenblatt's 'You Can be a Stock Market Genius'.

Most memorable books of investing provide you a first-hand insight into the minds of Wall Street's successful and storied investors. Beating the Street is no exception. It gives us an opportunity to peer into the philosophy of one of Wall Street's greatest investors ever, Peter Lynch. For those of you who are unfamiliar with Peter Lynch, he headed Fidelity's flagship Magellan Fund from 1977 to 1990. His track record is still today a legend, having given investors a nearly 30% compounded return during his tenure. Beating the Street is Peter's autobiographical chronicle on how his investment strategies developed and evolved as he grew the fund from obscurity into a multi-billion dollar juggernaut.I find the beginning chapters of the book very relatable and eye opening. Peter has a very down-to-earth style of talking about his life as a portfolio manager and has no shame in sharing the lessons learned from his investing missteps. I find it interesting that he never really had any set strategy for diversification and didn't really pick stocks to weight his selections among certain industries or types of investment. Rather, he just studied hundreds of different stocks looking for underlying fundamentals that seemed favorable. He never really distinguishes himself as a "growth investor" or "value investor", but contrasts the semantics between the two in his early chapters. I would consider him to be a growth investor since he focuses strongly on long term increases in earnings and dividends. Many of Peter Lynch's methodologies sound similar to much of what is presented in Jim Cramer's books. However, I would characterize Peter's delivery and presentation much closer to "sane money" than "mad money".The writing style is very personable, and I like how most of the book could probably be understood by a fifth grader. But that is not to say the book is too simplistic. Later chapters go into more detail with the financial metrics Peter looks for in a company - something that both amateurs and professional investors could find insightful.The fact that Beating the Street was published in 1993 is no disadvantage, and in fact makes the book more interesting since Peter's stock picks can be viewed through the scope of time. Curiously, many of the stocks that Peter recommends in this book are now defunct since the companies have been merged or taken over by larger entities. Perhaps they were bought out because of the same attractive fundamentals that put them on Peter's radar.However, it should be noted that many of his picks went through tough times for investors not long after the book's publication. One of his favorite stock picks, Supercuts, overstepped its capacity by expanding too aggressively. By the mid-1990s, Supercuts was unable to make enough money to recoup the debt acquired from its rapid build-out. In his pitch, Peter also didn't tackle the question of competition crowding out Supercuts since its business model was so easy to replicate. Some of his other picks like Nucor or Cedar Fair are still publicly traded today, but have mostly traded sideways with bumpy ups and downs for the last 18 years. Since the early 90s those stocks would have presented subpar returns to buy-and-hold investors.The poor performance observed by researching a handful of Peter's recommendations makes me wonder if the "50-baggers" and "200-baggers" that he ran across as a portfolio manager during the 80s could still exist in today's sideways market. A cursory look at some of his favorite stocks mentioned in the book made me realize that stock performance in general during the 80s and early 90s was superior to the decades after. Just look at the chart for Cracker Barrel, which returned almost 1900% in price appreciation from 1984 to 1993, but at its best only returned about 100% from 1993 to 2011. Although this is a topic for further research, it makes me wonder whether Peter's principles still apply in today's stock market or whether they need some updating.The question of whether Peter's style still has the same effectiveness is why I am only giving the book four stars. Has much really changed? Would Peter still be able to generate annualized returns of 30% in today's sideways market? We may never know. I would love to see an updated edition with an epilogue from Peter on what he would do differently in today's environment and how he would change his recommendations given hindsight.

Timeless advice on picking good companies to invest in. It's hard to argue with the main theses: Earnings up equals stock price up sooner or later. Unless you payed an egregious price. Patience is key. As long as the fundamentals are intact, sit tight and let the case play out. The last bit is the simplest but hardest part.

Love how Peter explains things to consider. As a n investor and trader really enjoyed reading this book.

I enjoy reading this book. It took me days and nights to read. I also skip some. However, this book is a must-read. Lastly, I recommend this book for people who have some experience and looking to improve their investing mindset. Not for newbies because you will be bored to read page by page.

I really enjoyed Lynch's honest take on managing the Magellan fund. I think he was humble enough to admit his luck and how he got "enough of the 10-50X" returns to make up for his more numerous small losses or break-even deals. I think the DIY investor can learn a lot from this. First, it helped me remember that I'm not a pro and this isn't my day job. I can't go on a trip to research a company. Second, times have really changed since Lynch's success. The Magellan fund went on to mediocrity falling his departure. Which brings me to this point: index investing just has too much research supporting it. Even Lynch acknowledged that many active managers are little more than "closet index funds". So, as a DIY index investor following more of a Beating VTSAX approach, I liked it!

Interesting read on Peter Lynch's story and why he was successful trading stocks but the book didn't help in how to pick the best stocks or funds for your own portfolio. He went and had meetings with the company's he was interested in investing with. That's not practical for the average investor.