"If a business earns 18% on capital over 20 or 30 years, even if you pay an expensive looking price, you’ll end up with one hell of a result." — Charlie Munger
Here are 10 stocks with a return on capital > 20%:
Here are 10 stocks with a return on capital > 20%:
1. Alphabet (GOOGL) ROIC: 32.1%
Alphabet is the parent company of Google, which makes money mainly through ads.
It also owns YouTube, Android, and invests in AI and other tech projects.
Alphabet is the parent company of Google, which makes money mainly through ads.
It also owns YouTube, Android, and invests in AI and other tech projects.
2. Eli Lilly (LLY) ROIC: 27.1%
Eli Lilly is a drug company known for making treatments for diabetes, cancer, and now obesity.
It’s growing fast thanks to its new blockbuster drugs.
Eli Lilly is a drug company known for making treatments for diabetes, cancer, and now obesity.
It’s growing fast thanks to its new blockbuster drugs.
3. The Home Depot (HD) ROIC: 25.0%
This is where America goes to fix its house.
The company sells lumber, tools, appliances.
This is where America goes to fix its house.
The company sells lumber, tools, appliances.
4. Hermès () ROIC: 44.6%
Some brands sell luxury. Hermès sells exclusivity.
It makes handbags that cost more than most used cars… and scarves that cost more than a flight to Paris. RMS.PA
Some brands sell luxury. Hermès sells exclusivity.
It makes handbags that cost more than most used cars… and scarves that cost more than a flight to Paris. RMS.PA
5. Accenture (ACN) ROIC: 25.0%
Big companies call Accenture when they’re stuck.
It doesn’t build apps or devices. It fixes what’s broken.
Strategy, software, and systems are cleaned up and running again.
Big companies call Accenture when they’re stuck.
It doesn’t build apps or devices. It fixes what’s broken.
Strategy, software, and systems are cleaned up and running again.
6. Apple (AAPL) ROIC: 33.2%
Apple makes consumer electronics, software, and services.
It integrates them into a seamless ecosystem.
Apple makes the hardware. Then charges rent to use it.
Apple makes consumer electronics, software, and services.
It integrates them into a seamless ecosystem.
Apple makes the hardware. Then charges rent to use it.
7. Arista Networks (ANET) ROIC: 21.2%
As the cloud grows, Arista cashes in.
It builds the high-speed pipes inside data centers.
Tech giants like Amazon and Microsoft rely on it.
You won’t see it. But your data sure does.
As the cloud grows, Arista cashes in.
It builds the high-speed pipes inside data centers.
Tech giants like Amazon and Microsoft rely on it.
You won’t see it. But your data sure does.
8. Cintas Corporation (CTAS) ROIC: 23.8%
Uniforms are a great business.
Cintas doesn’t just rent out work shirts. It sells peace of mind.
Need clean towels? Floor mats? Safety gear? First aid kits?
Cintas delivers it, replaces it, and bills you again next month.
Uniforms are a great business.
Cintas doesn’t just rent out work shirts. It sells peace of mind.
Need clean towels? Floor mats? Safety gear? First aid kits?
Cintas delivers it, replaces it, and bills you again next month.
9. Ferrari (RACE) ROIC: 24.9%
Most car companies want to sell more cars.
Ferrari doesn’t.
It caps production. Refuses to discount. And makes its customers wait years to buy one.
This isn’t just a car company. It’s a luxury brand that happens to make V12s.
Most car companies want to sell more cars.
Ferrari doesn’t.
It caps production. Refuses to discount. And makes its customers wait years to buy one.
This isn’t just a car company. It’s a luxury brand that happens to make V12s.
10. Booking Holdings (BKNG) ROIC: 43.7%
Every time someone books a hotel online, this company gets paid.
It owns , Priceline, Kayak, and more.
The travel industry is cyclical, sure. But Booking has two things going for it: scale and software. Booking.com
Every time someone books a hotel online, this company gets paid.
It owns , Priceline, Kayak, and more.
The travel industry is cyclical, sure. But Booking has two things going for it: scale and software. Booking.com
Return on Invested Capital is my favorite metric. A high ROIC is a must for me as a quality investor.
In the following e-book, you'll learn the difference between ROIC, ROCE, ROE, and ROA: compounding-quality.kit.com/9822642da1
In the following e-book, you'll learn the difference between ROIC, ROCE, ROE, and ROA: compounding-quality.kit.com/9822642da1
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