Owner: Investment Jungle URL:http://www.investmentjungle.com/blog Join Date: Thu, 31 May 2007 10:49:23 -0500 Rating:0 Site Description: The Investment Jungle’s mission is to empower individual investors to gain the knowledge, skill, and confidence required to invest in high quality stocks to ensure a lifetime of successful investing so as not to fall prey to ‘predators’ within the financi Site statistics:Click here
Understanding Return on Invested Capital 2007-07-26 08:00:13 As you know, for a Rule #1 investor, the return on invested capital is the most important of the Big Five.
In Phil Town’s own words (page 66)
It’s a measure of how effectively a company uses the money (borrowed or owned) invested in its operations. As such, it’s also an indicator of how effective a company’s management team is at using the money invested in its operations. A good, solid ROIC is one of the first indications that the managers of this business are on the side of its owners.
I have found an excellent article that was written back in 1996 that discusses the ROIC and that I feel is well written. The article states that
Return
On Invested Capital (ROIC) is a superior quantitative touchstone with which to assess value creation. We believe ROIC to be an important guide to a company’s future prospects for value creation and to be significantly more informative than traditional investment heuristics—EPS, EBITDA and ROE—which can be misleading i Read more:Understanding
Back from Vacation 2007-08-02 08:00:13 I returned late last night from my “visiting the in-laws” vacation. Although my vacation was a pleasant, relaxing experience, it seems that the markets decided to have themselves a good old time while I was away!
I happened to be watching a show where the commentator asked his guest if this was the start of a bear market. And the guest said something to the effect that “all the bulls must be on vacation!” I thought that was funny as I could appreciate the fact that I was a spectator to the market fall.
Unfortunately, I did not have access to a computer while on vacation. However, I do promise to get answer each comment and mail in the next couple of days. Also, I will be working feverishly on getting my watch list published so that I can easily find out if any of the stocks have fallen into the ‘buy’ range!
I hope that you enjoyed the articles that I had prepared in advance for you. I am looking forward to some buying opportunities in the near Read more:Vacation
Reader Request - Garmin Limited (NASDAQ:GRMN) 2007-08-06 19:04:22 Investment Jungle reader Seabiscuit has requested that we have a look at Garmin
Limited. Garmin Ltd trades on the NASDAQ under the symbol GRMN.
In fact, Phil Town used Garmin Limited in his example of calculating the Big Five. He wanted to compare two companies so he used Garmin Limited and General Motors. So, let’s see if Garmin Limited is still a Rule #1 stock.
Company Profile:
From Yahoo Finance
Garmin, Ltd. and its subsidiaries engages in the design, manufacture, and marketing of navigation, communications, and information devices that are enabled by global positioning system (GPS) technology worldwide. It operates in four segments: Automotive/Mobile, Outdoor/Fitness, Marine, and Aviation. The Automotive/Mobile segment offers a range of automotive navigation products, as well as a variety of products and applications designed for the mobile GPS market. The Outdoor/Fitness segment provides GPS-enabled handheld products for outdoor activities and training assistants for athl Read more:Reader
Carnival Monday - August 13, 2007 2007-08-13 18:44:11 Check out the Festival of Stocks 49th Edition over at My Wealth Builder. There are a ton of excellent articles.
And thank Super Saver for doing such a great job hosting this week!
If you liked this post, consider buying me a beer.
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