- Low profit margins on sales coupled with low inventory turnover
- Low returns on shareholders' equity
- Absence of any brand loyalty
- Presence of multiple producers
- Existence of substantial excess production capacity in the industry
- Erratic profits
- Profitability that is almost entirely dependent upon management's abilities to efficiently utilise tangible assets.
Keep INVESTING Simple and Safe (KISS) ****Investment Philosophy, Strategy and various Valuation Methods**** The same forces that bring risk into investing in the stock market also make possible the large gains many investors enjoy. It’s true that the fluctuations in the market make for losses as well as gains but if you have a proven strategy and stick with it over the long term you will be a winner!****Warren Buffett: Rule No. 1 - Never lose money. Rule No. 2 - Never forget Rule No. 1.
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Wednesday, 8 October 2008
Identifying the Commodity Type Businesses
Commodity type businesses have the following characteristics:
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