We believe companies that possess the following business attributes, management attributes, and financial attributes are well positioned to create value for shareholders through varying economic and market environments.
- Essential products and services
- Loyal customers
- Leadership in an attractive market niche or industry
- Sustainable competitive advantages
- Strong operators with integrity
- Effective capital allocators
- Meaningful share ownership
- Strong balance sheet and free cash flow
- High returns on capital
Purchasing such businesses when they are trading at discount to Intrinsic Value and with a meaningful Margin of Safety reduces the likelihood of permanent capital loss on any single investment.