My time playing golf taught me some useful lessons as an investor. For one, you make mistakes all the time and you try to learn from them, but it's always about the next shot. It's about properly preparing and then executing to the best of your ability. That's an excellent mindset for an investor to [...]
We have a total of seven analysts, including myself, and we believe when investment teams have more than 10 people they start to break down. Egos get in the way, people start to specialize, and you just can't have the quality of collective discussion we think is necessary.
Our most important focus is on understanding a business' return on invested capital and, perhaps more importantly, its return on incremental invested capital [ROIC], which I've learned to appreciate more and more over the past 25 years. We scrub the financials to get a reliable picture of the company's historical full-cycle ROIC and want to [...]
We always ask before buying whether we'd be comfortable putting the stock in a lockbox for five years and not touching it. If we're not, we shouldn't buy it. That's not an argument for putting your head in the sand, but we think you need that level of confidence in the business to think most [...]
We’re typically not attracted to most technology businesses because of cut hroat competition, potential technology obsolescence, short product cycles,and the excessive use of stock options. The return on time is also a problem you spend so many hours analyzing new products and technology trends that 50 percent of your time gets spent on 5 to [...]