The Fairholme and Wintergreen funds are good examples. Berkowitz, Winters and their peers look to buy shares or debt of companies at a substantial discount to the managers' estimate of its true market worth -- taking advantage of what's called "impaired value." Winters saw this disconnect in Chesapeake Energy Corp. (CHK:Chesapeake Energy Corporation News, chart, profile, more Last: 41.73+3.16+8.19%
Delayed quote dataAdd to portfolio Analyst Create alertInsider Discuss Financials Sponsored by: CHK 41.73, +3.16, +8.2%) . The natural gas company's stock was hammered this summer as investors unplugged from the once-hot energy sector, but Winters sensed an overreaction. By his analysis, Chesapeake's assets, joint-venture relationships and potential gas reserves should be worth between $100 and $120 a share to an outside buyer. The stock, meanwhile, trades just north of $41 a share. "If you can buy something at potentially a third of transaction value, that's pretty exciting," Winters said.
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