Still Going Strong

Kahn, the chairman of Kahn Brothers, a low-profile New York investment firm, might be Wall Street's oldest active investor. He's in the office every business day, reading scientific periodicals, annual reports and newspapers in search of undervalued stocks in the tradition of his friend and mentor, Benjamin Graham, widely considered the father of value investing.

Kahn worked as a teaching assistant for Graham at his lectures at Columbia University that started in 1928, and he helped Graham with statistical material for his first major work, Security Analysis, which was co-authored by David Dodd and published in 1934. Kahn met his wife, Ruth, at one of Graham's early Columbia lectures. She died in 1996.

Along the way, Kahn got to know many of Graham's famous disciples, including Warren Buffett. A gutsy Kahn wasn't swept up in what he calls the "crazy market" of the late 1920s. In fact, his first trade in the summer of 1929 actually was a short sale of Magma Copper that turned out to be a winner in a few months.

Given his success over a 77-year career, Kahn has no need to work, but he scoffs at retirement. "It's like I'm married to the business, more so because my wife isn't here. It's sort of a like a game with me," Kahn said recently at the firm's midtown Manhattan office. "It's fun to get things right for the right reason."

Kahn could be on the job for a while longer because he's a member of an extraordinarily long-lived clan. His oldest sister, Helen "Happy" Reichert, is 104, and his younger brother, Peter, is 95. Kahn's other sister, Lee Reichart, died in the past year at 101. Only about 1 in 1,000 people in the Kahns' generation reach 100. The Kahns have been the subject of studies seeking to unlock the elusive genetic secret of long life. So far, researchers haven't found much through their genetic sleuthing, except that the Kahns have high levels of the "good" cholesterol, HDL, which can ward off heart disease.

The surviving siblings remain mentally sharp, and Irving is in good physical condition. In warm weather, he walks the mile from his apartment on Manhattan's Upper East Side to the firm's offices on Madison Avenue and 55th Street. On a cold recent afternoon, this reporter rode on a city bus with Kahn from his office to his home. Although his firm would gladly pick up the tab for a car service, Kahn finds the $25 cost "obscene," relative to the senior-citizen bus fare of $1.

Says Kahn Brothers president, Tom Kahn, Irving's 63-year-old son: "My father continues to research ideas and talk to companies. One of the nice things about this business is that there's no mandatory retirement age, and you allegedly get wiser as you get older." And, he adds: "Sometimes I'll talk to a company and they'll tell me. 'Your father just called last week.' Irving is a voracious reader. He reads several newspapers a day, plus numerous scientific journals. He's a frustrated scientist."

Irving Kahn still finds good ideas. A year ago, he unearthed Payless ShoeSource (ticker: PSS), the country's largest budget-shoe retailer, whose shares were around 12, just a small premium above book value of $10. Kahn was bullish on the business because he felt there was a strong need for well-made, inexpensive shoes — and the stock was cheap. Payless has since doubled. "I read a lot of annual reports," Kahn says. "J.C. Penney decided to get rid of Payless." Part of his research involved buying a pair of Payless leather shoes for $49. He liked them, and was wearing them at the office last week. "He feels that, at $99, Rockports are too expensive," jokes Tom Kahn.

A modest man, Irving Kahn isn't crazy about the attention his 100th birthday is generating. He was honored Tuesday night by the New York Society of Security Analysts, which he, Graham and several others founded in 1937, when stocks were largely discredited as an investment and the community of stock analysts — then called statisticians — was very small.

About 100 people attended the dinner, including such value-investing luminaries as Mario Gabelli, Marty Whitman, Charles Royce, Jean-Marie Eveillard and Walter Schloss. The keynote speaker, Louis Lowenstein, a former Columbia Business School professor, lauded Kahn as a "model of wisdom and sanity."