The holy trinity of value creation
There is a single question that drives the fundamental investment thought process perhaps more than any other... Over the long term what allows one business to create significantly more value for shareholders than another, ostensibly similar business? Arguably, there is no definitive answer. History has shown that companies can achieve success in any and every manner conceivable. There is however, one feature so pervasive among those truly outstanding companies as to become a central tenet of value investing and one of the foundational pillars of Clime’s investment process - we call it the ‘holy trinity of value creation’. The ability to generate, retain and reinvest capital at incrementally accretive rates of return. The challenge is identifying such companies, preferably early, before their truly outstanding attributes are widely recognised by other investors. Today, we share some of the key markers that may make identifying such companies a little easier. (VIEW LINK)
The Clime Group is a respected and independent Australian Financial Services Company, which seeks to deliver excellent service and strong risk-adjusted total returns, closely aligned with the objectives of our clients.