I don't know if Ackman and
other value investors failed to cut Valeant losses because they fell in love with the company or because they were unable to see or acknowledge their mistake, but the moral of the story is that concentrated investors watching the basket closely can still make costly mistakes.
Not exact matches
In Deep
Value: Why Activist
Investors and
Other Contrarians Battle for Control of Losing Corporations (Wiley Finance, 2014), I examined one such example of an undervalued, overcapitalized company that
failed to take its opportunity until two activists stepped up the pressure, and the outstanding returns that followed.
But a
Value Investor who
fails to consider valuations might do okay all the same if his assessments of all the
other factors he takes into consideration are sharp enough.