Not all moats are the same. Some moats are wider but not as durable, while others might be durable but have little growth opportunities. The 3 things that determine the attractiveness of a moat and how much the business is worth are its return on capital, durability, and reinvestment opportunities. Return on Capital Return on […]
Peter Thiel is a co-founder of PayPal and Palantir Technologies, which specialized in big data analytics. While it is more apt to call him a tech entrepreneur than an investor, he knows something about moats and good thinking. Peter Thiel explains the differences between perfect competition and monopoly: “Every firm in a competitive market is […]
Price to Earnings ratio is the most widely used tool to gauge the attractiveness of a stock. But it is important to know the limitation of PE ratio so we don’t fall for the “everything looks like a nail to a man with a hammer” illusion. Here are a few things to understand. Confuse between […]
Free cash flow is the amount of cash that can be extracted from a business to pay a dividend, reduce debts and buy back its shares. Hence it is a neat figure to value how much a business should worth. However, free cash flow sometimes doesn’t provide us with the full picture. I was going […]
Karex is the largest condom contract manufacturer producing over 5 billion condoms annually to global brands like Durex, Ansell, government, and health organizations. While most of their earnings come from contract manufacturing (OEM) market, Karex’s also sells their own condom brands under Carex and INNO via OBM (original brand manufacturing) market. Karex named ‘Expansion of […]
The starting point to value banks is to understand how banks make money. Banks use the funds provided by their customers in the form of deposits and lend it to other customers that require financing whether that’s for credit card, house, car, business, personal or so forth. The spread between the deposit rate and financing […]