Sentences with phrase «incremental capital»

Leaving the question of price aside, the best business to own is one that over an extended period can employ large amounts of incremental capital at very high rates of return.

So long as returns on incremental capital in such situations are excellent, investors should not worry about low dividends.

Raising incremental capital in this environment was not possible.

Anything to remove the uncertainty, and the high cost of incremental capital due to uncertainty over survival.

To us, this cumulative and collective misfortune has translated into a loss of credibility and perhaps an inability to raise significant incremental capital for several years to come.

In our businesses we can nearly always grow revenues organically without incremental capital.»

«Leaving the question of price aside, the best business to own is one that over an extended period can employ large amounts of incremental capital at very high rates of return.»

First off, Munger said See's was his most important learning lesson because it taught Munger and Buffett about the value of owning a great business, specifically one that can produce ever growing levels of cash flow with very little incremental capital requirements.

Since that time, the company has sent around $ 2 billion of pretax cash flow to Berkshire, using just $ 40 million or so of incremental capital investments.

Our appraisal of what any company is worth is based on quantitative factors like its growth rate and returns on incremental capital as well as on qualitative factors like its management quality and stability of cash flows.

I believe it's fair to say that as we look at a world where very few asset classes globally have produced positive nominal returns year - to - date, and a world where US corporate earnings and economic growth have been tepid at best, increasingly ascending US equity valuations connote incremental capital concentration.

Scalable moats which can take in capital i.e., the business can grow rapidly but they need incremental capital for that growth and that capital is usually provided by keeping dividend payout ratio low.

And I only limit to high ROE, low leverage businesses (most of my portfolio businesses are debt - free) which can grow earnings where return on incremental capital is high.

The «good» part comes from what Warren Buffett talked about in one of his shareholder letter back in 1992: He wanted businesses that could invest large amounts of incremental capital at very high rates of return.

«At a high level we are seeing the health of the banking system here and it's been a process to return incremental capital,» said Devin Ryan, analyst at JMP Securities.

We, then, conservatively assume that UHS can grow ACHC's revenue and NOPAT / free cash flow without any incremental capital outlays after year 1, an unlikely assumption, but nonetheless.

After all the Buffett quote is that the best business is one that employs LARGE AMOUNTS of incremental capital at very high rates of return, not one that uses all of its incremental capital (and then some) to pay a dividend.

I like the approach and also like to look at dividends as part of the overall capital allocation of the company, if I can get a better return on the incremental capital by the company paying out a dividend then I'd prefer the dividend, however if the company could get a return on incremental capital superior to me, I'd be happy for them to keep it.

Smart companies don't just grow earnings — they grow earnings at a rate that's attractive relative to the incremental capital required to support this growth.

In an effort to capture the best of Graham's mechanical cigar butt approach and Buffett's more subjective concentrated approach, I've decided — for the time being — to go with a quantitative approach that tries to identify undervalued, unleveraged companies with high returns on incremental capital and / or invested capital.

I also recently discovered a superb blog site, Base Hit Investing (BHI) by John Huber and Matt Brice, that has added greatly to my knowledge of return on invested capital, return on incremental capital, and the impact of portfolio turnover on overall returns.

The actuary might say that you estimate the default loss rate over the life of the bond, and the required incremental yield that the marginal holder of the bond needs to fund the incremental capital employed.

After that, the portfolio managers were encouraged to ignore the rating, except to calculate the yield haircut for the incremental capital employed.

New Construction Program helps offsets the incremental capital costs of purchasing and installing equipment in buildings to reduce energy consumption.