I will usually only buy a business if its Return on Invested Capital (ROIC) [1] is greater than my discount rate (except for the last year).[2] I adopt this approach because if a business’s ROIC has been, or is, greater than my discount rate, I think the business could be viable. It also means that any [...]
Archive for the ‘My Discount Rate’ Category
My Discount Rate
Posted in My Discount Rate on February 22, 2010 | 2 Comments »
Categories
- Asset Allocation
- Competitive Advantage – 1
- Competitive Advantage – 2
- Competitive Advantage – 3
- Controlling emotions
- Customer Captivity
- Earnings Growth and Profitability
- Economies of Scale
- Falsifying scenario’s
- Group Decision Making
- Ignoring market moves
- My Circle of Competence
- My Discount Rate
- My Quantitative Valuation Model – 1
- My Quantitative Valuation Model – 2
- Normalising Earnings
- ROIC and Competitive Advantage
- ROIC versus ROE
- Talking to Management
- Technology and Competition
- The Basics – Part 1
- The Basics – Part 2
- The Basics – Part 3
- Valuing using scenarios
- When to Sell
- Will the business survive?
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