Charlie Munger: "I can’t give you a formulaic approach because I don’t use one. I just mix all the factors, and if the gap between value and price is not attractive, then I go on to something else." We buy securities like Apple that we wouldn’t have bought in the old days." 2018
Bill Gurley: "Knowing what long-term cash flows look like requires knowledge of a vast number of disparate future variables. What is the long-term growth rate? What is the long-term operating margin? How long will this company hold off competition?" abovethecrowd.com/2011/05/24/all…
"While one might not have specific numbers required to complete an accurate DCF, we do know which business qualities would have a positive impact on a DCF exercise, all things being equal. characteristics that are inconsistent with a strong DCF model have low “revenue quality.”
Charlie Munger: "There are two kinds of businesses: The first earns 12%, and you can take it out at the end of the year. The second earns 12%, but all the excess cash must be reinvested — there’s never any cash. We hate that kind of business.”
Warren Buffett: “Most important is pricing power. If you’ve got the power to raise prices without losing business to a competitor, you’ve got a very good business. And if you have to have a prayer session before raising the price by 10%, you’ve got a terrible business.”
Jeff Bezos: "It’s the absolute dollar free cash flow per share that you want to maximize, and if you can do that by lowering margins, we would do that. ... Companies are valued not on their percentage margins, but on how many dollars they actually make, and a multiple of that.”
