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Pat Dorsey
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“• Besides fixed assets, an industrial company needs to manage working capital efficiently.”
― The Five Rules for Successful Stock Investing: Morningstar's Guide to Building Wealth and Winning in the Market
― The Five Rules for Successful Stock Investing: Morningstar's Guide to Building Wealth and Winning in the Market
“Next, divide free cash flow by sales (or revenues), which tells you what proportion of each dollar in revenue the firm is able to convert into excess profits. If a firm’s free cash flow as a percentage of sales is around 5 percent or better, you’ve found a cash machine—as of mid-2003, only one-half of the S&P 500 pass this test. Strong free cash flow is an excellent sign that a firm has an economic moat.”
― The Five Rules for Successful Stock Investing: Morningstar's Guide to Building Wealth and Winning in the Market
― The Five Rules for Successful Stock Investing: Morningstar's Guide to Building Wealth and Winning in the Market
“unless a company has some kind of economic moat, predicting how much shareholder value it will create in the future is pretty much a crapshoot, regardless of what the historical track record looks like. Looking at the numbers is a start, but it’s only a start. Thinking carefully about the strength of the company’s competitive advantage, and how it will (or won’t) be able to keep the competition at bay, is a critical next step.”
― The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments
― The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments
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