Someone asked me a question about using risk-adjusted discount rates when valuing stocks. Here’s my answer. The discount rate for a stock should be the opportunity cost of putting money in it instead of something else. For your average...
Someone asked me a question about relative valuations: “There are a couple of instances when we can value the stock based on comparables. However, for me, I feel that there is something in the middle that I can’t figure out. There is a...
Someone asked me this question: “Warren Buffett had commented that Coca-Cola has a durable competitive advantage. It is one of his ‘inevitables’. I am curious what is your thought on the investment merit of a business that may not grow...
From a “100-bagger” type perspective, the criteria are pretty simple: 1) Is it a small stock (probably a micro-cap, definitely a small-cap)? – We’re talking <$300 million market cap probably, but certainly like...
Someone sent in this question: When deciding to look for a bank, where do you start? What is your initial approach when finding a bank? So, I don’t really have one specific thing I look for in a bank stock. The way it usually works...
On a recent episode of the rundown – a weekly YouTube show with Andrew Kuhn and Vetle Forsland – Andrew asked the question of whether you could be a good investor without being a good stock picker and vice versa. To answer this question,...
A Focused Compounding App subscriber had a question about something I said in a recent podcast: “In your recent podcast you said you thought a tobacco firm should buy back its own stock rather than pay dividends – you said you...
One of Warren Buffett’s basic tests for buying a stock is the idea that if you wouldn’t buy the whole company at this price – market cap, enterprise value, etc. – you shouldn’t buy the stock. Not even to hold it for just a week, month, or...