My investment philosophy (THREAD)
A) Identify stocks based on financial metrics such as:
rev growth/margin profile/op fcf & fcf trends/bs health/capital mgmt
Is growth powered solely by more opex, debt or equity dilution?
Is there any operating leverage apparent in business?
A) Identify stocks based on financial metrics such as:
rev growth/margin profile/op fcf & fcf trends/bs health/capital mgmt
Is growth powered solely by more opex, debt or equity dilution?
Is there any operating leverage apparent in business?
B) Study quality of products, competitive landscape, innovation pipeline, mgmt quality, & try to identify a strong moat.
Ask myself (& others) will products be growingly needed over 20 yrs? Is the company in a position to fill added demand?
Is it being disrupted or disrupting?
Ask myself (& others) will products be growingly needed over 20 yrs? Is the company in a position to fill added demand?
Is it being disrupted or disrupting?
C) Listen to several past earnings calls & executive interviews to gage how timely & successful mgmt is w/executing stated goals.
Were predictions reliable or did they consistently miss the mark?
How smoothly are ops carried out?
Can I trust this mgmt team w/my $?
Were predictions reliable or did they consistently miss the mark?
How smoothly are ops carried out?
Can I trust this mgmt team w/my $?
D) Ensure I know every aspect of the company so I understand what possible future news would threaten the validity of my investment thesis. 
And finally... if it still looks extremely compelling:
E) Buy 40-50% of full position & hold until thesis changes (usually for several years)
f) add in 10-20% pieces when headline noise doesn’t threaten overall thesis BUT does provide price opportunity.
Rinse & repeat 🙂
E) Buy 40-50% of full position & hold until thesis changes (usually for several years)
f) add in 10-20% pieces when headline noise doesn’t threaten overall thesis BUT does provide price opportunity.
Rinse & repeat 🙂
