The Little Book That Builds Wealth Quotes

“Identify businesses that can generate above-average profits for many years. 2. Wait until the shares of those businesses trade for less than their intrinsic value, and then buy. 3. Hold those shares until either the business deteriorates, the shares become overvalued, or you find a better investment. This holding period should be measured in years, not months. 4. Repeat as necessary.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“1. Identify businesses that can generate above-average profits for many years. 2. Wait until the shares of those businesses trade for less than their intrinsic value, and then buy. 3. Hold those shares until either the business deteriorates, the shares become overvalued, or you find a better investment. This holding period should be measured in years, not months. 4. Repeat as necessary.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“One annual report is worth 10 speeches by a Federal Reserve chairman.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“the likelihood that those estimated future cash flows will actually materialize (risk), how large those cash flows will likely be (growth), how much investment will be needed to keep the business ticking along (return on capital), and how long the business can generate excess profits (economic moat).”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“Wait until the shares of those businesses trade for less than their intrinsic value, and buy.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“Network-based businesses tend to create natural monopolies and oligopolies.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“The difference between Cisco Systems CEO John Chambers and Enron’s Kenneth Lay is far easier to recognize with the benefit of 20/20 hindsight.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“Unless a company has an economic moat protecting its business, competition will soon arrive on its doorstep and eat away at its profits. Wall Street is littered with the dead husks of companies that went from hero to zero in a heartbeat.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“The best engineer in the world can’t build a 10-story sandcastle.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“Even the Best Company Will Hurt Your Portfolio If You Pay Too Much for It.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“unless a company has some kind of economic moat, predicting how much shareholder value it will create in the future is pretty much a crapshoot, regardless of what the historical track record looks like. Looking at the numbers is a start, but it’s only a start. Thinking carefully about the strength of the company’s competitive advantage, and how it will (or won’t) be able to keep the competition at bay, is a critical next step.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“Thinking about moats can protect your investment capital in a number of ways. For one thing, it enforces investment discipline, making it less likely that you will overpay for a hot company with a shaky competitive advantage. High returns on capital will always be competed away eventually, and for most companies—and their investors—the regression is fast and painful.”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments

“you can simply buy wonderful companies at reasonable prices, and let those companies compound cash over long periods of time. Surprisingly, there aren’t all that many money managers who follow this strategy, even though it’s the one used by some of the world’s most successful investors. (Warren Buffett is the best-known.)”
― Pat Dorsey, The Little Book That Builds Wealth: The Knockout Formula for Finding Great Investments