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Invest in Great Businesses Only at Reasonable Prices

What makes a ‘Great Business’?

Substantial Growth Potential over next 5-10 years, Bought at Fair Valuations

 

  • Profitable growth is a key to any businesses value, and enables the investor to compound their investment over time.

  • Businesses that smartly allocate profits and generate cash flow at a higher rate of return than the market offer outstanding long-term profit potential. Examples could be developing new products, opening new markets, acquiring small companies in the industry at attractive valuations, retiring more expensive debt, and returning capital to shareholders.

  • Strong market position from branding, patents, niche strength, scale, or high market share.

  • Profitable companies with a strong, defensible market position can maintain high returns for years or even decades.

  • Strong balance sheets to endure the business cycle's inevitable ups and downs.

  • Long-term holding periods lower tax liability through long-term capital gains.

Quality Value Style: Profitable, free cash flow generators, bought at attractive prices versus peers