The best way to protect against that, Woodman says, is to build
a moat around the company in the form of its content ecosystem.
Not exact matches
«The
companies that are going to be able to withstand this are the ones that have a sort of
moat around their businesses,» he said.
A Reinvestment
Moat company has the strong competitive advantages
around their core business as seen in the Legacy
Moats, but their market is not yet saturated and the
company has the ability to reinvest the cash they generate into growing.
In short, the
company is a cash - gushing powerhouse with thick, consistent profit margins and a huge competitive
moat around its business... it pays an above average yield (and a dividend that's steadily growing)... and it continually buys back its own stock.
Warren Buffett has spoken often of preferring
companies with economic «
moats»
around them that make a challenge from a would - be competitor a challenge.
The checklist for a small investor who focuses on buying good
companies with durable
moats would revolve
around three factors — business, people, price.
A classical value investor will not find the stock very attractive but there is no way to deny the
moat that the
company has built
around its margins and the growth it has been able to generate.