Always great stuff, Todd. The nice part is the multiple ("speculative") piece tends to go up as earnings compound, it's just I prefer to get it for free.
Thanks! Yes, the tricky part is getting the confidence intervals about future earnings growth necessary to make the Buffett approach work. As you say, as earnings growth becomes more "certain," the multiples expand and you get the classic Davis Double Play.
Always great stuff, Todd. The nice part is the multiple ("speculative") piece tends to go up as earnings compound, it's just I prefer to get it for free.
Everything is easier said than done, of course.
Thanks! Yes, the tricky part is getting the confidence intervals about future earnings growth necessary to make the Buffett approach work. As you say, as earnings growth becomes more "certain," the multiples expand and you get the classic Davis Double Play.