A recent, lengthy email that hit our inbox promised that an "Extreme Value" retirement plan which uses a "unique and little-known investment strategy" would double or triple our money with low risk.

Intrigued, yet suspecting this was another bit of marketing hype, we read the entire email thoroughly word for word over and over again because sometimes this gives insights into the strategy being employed.

One stock being touted in the email as the "85% Blue Chip Bond" is (courtesy of a Google search) almost certainly Home Depot (HD). On Home Depot's website, a press release states:

Ben Graham and latterly Warren Buffett swear by book value per share  (sometimes referred to as net asset value or asset value) as a useful if not the most useful measure of a company as a potential investment.

Many investors misunderstand Graham and Buffett by considering only static book value, much in the same way that they may look at the Price/Earnings ratio in isolation at a particular point in time.

A far better and more dynamic approach is to observe the growth (or decline as the case may be) in a company's book value over a period of  time. There are several reasons why such an approach is a better measurement of growth and predictor of future growth than EPS.