I love this channel and content. You choose a wide variety of books and illustrate them perfectly, thank you for assisting me in gaining knowledge in this field. You should be held in high regards in the RU-vid community. Carry on and keep helping others!
Great video. One other factor to look out in a 100 bagger + is the dividend payment or lack of one! A few of the 100 baggers pay out no dividend (Monster Beverage, Berkshire Hathaway, Amazon) or have a very low payout ratio (Apple - 22% of net earnings), Microsoft 33% of net earnings). The rest of the net earnings are invested straight back into the company for more growth - this can mean many billions of dollars are reinvested back again compounding the company's growth.
Video summary: Buy company with following traits 1. Small Caps upto 1 B in Market cap 2. Twin engine: Find High revenue growth stocks, getting high multiples ( PE PB PS) 3. Coffee Can approach: Buy right, sit tight. Hold for 10 years 4. Honest Management
I had read this book about 2 years back (along with Acquirers Multiple by Tobias Carlyle) and these have completely changed my perspective on stock. Today I have accidentally stumbled upon your channel and found this video. I have to say this video has been crisp, concise and captures the essence of the book. Nice work and I would probably be spending next couple of hours going through your other videos to get a gist of some of the well known finance books.
Hey swedish investor, im following ur channel for a couple of months now and im wondering. It would be nice that, for instance for this video, would provide some example stocks which you think fall in the category you're talking about. Gr, a Dutch follower
King Brouwer, I appreciate that you've been following the channel for so long 🙌 Thank you for the suggestion, I will think about it in the future videos, and see if it can be done in a way that is educating, and not just handing over a "stock tip". Because in investing, I really think that you must make your own decisions. That's why the videos focus 100% on helping one develop his/her own toolkit. I think there's a biblical proverb which goes like this (I may have made my own interpretation): "Give a man a stock tip and he'll be wealthy for a day. Teach a man to invest and he'll be wealthy for a lifetime." Cheers 😁
13:51 I can't avoid to check my portfolio value every day! Haha but during last year I trained my "stomache" (like Peter Lynch said) and instead of selling, I bought to average down prices. Great information! Greetings from a very difficult financial country like Argentina! ⭐⭐⭐
My daughter loves Minute Physics on RU-vid and I hope you'll consider it a complement when I say the few videos I've watched so far are like the Minute Physics for investment books. Easy to follow. Easy to listen to. Imparts a lot of good info in an uncomplicated way. I'm a beginner in the retail markets but don't want to just point and guess. Your channel is helping me focus on the right investing strategy for my particular strengths and interests without having the read every single book out there. I haven't narrowed down which books I want to actually buy yet, but I'm on my way. Thank you!
Hi Swedish investor, I am wondering if you could let us know of some ways of finding whether a manager is good other than looking at just their owner percentage in the company if you know of any. Thanks in advance :)
Yeah, 100 bagger sounds really special until you hear the 26 years on average :) that mean its about 20% annual return which is of course amazing and pretty non-hassle for a set and forget simple business you believe in at all weather. Having said that you don't have to restrict yourself to this type of investment as it is absolutely possible to find value and other types of investments with expected return of 20% annually. But they do require higher turnover...
hi great video! When talking about great CEO's He cites Thorndikes who says that it is Cashflow that determines value not Earnings. How do you understand that? should we still look at earnings or just analyze pure cashflow? best regards
Am listening to the audiobook atm and can attest to its excellency! I intuitively thought it would advocate penny stocks but it's soooo much better than that!
exactly! How much does this return over buying an etf or a good piece of real estate. What are the chances that none of these will produce? I don't feel like gambling.
if it takes 26 years for the average 100 bagger you could "simply" do 19,4% annually and you will get the same results without the struggle of having to decide now, which company might be one of the best stock picks for for the next almost 3 decades though 19,4% annually might be just as difficult
I like the idea of twin engines, but I would add a few more things. Let's say the company doubles its sales but trades at the same multiple. That's a doubling in stock price. Then, the company doubles its net income margins. Keeping PE the same, that's a 4x. Then, the PE multiple rises to reflect the improvements in earnings. That's an 8x. Then, the company uses those new free cash flows to buy back half its shares. That's a 16x. Kind of an ideal scenario, but it goes to show what is possible by just doubling the revenue, if the other puzzle pieces fall into play. Of course, it would have to be the type of growth that creates value, and wouldn't apply to companies that grow their revenue by destroying their margins or taking on way too much debt.
That is really interesting. I first heard about 10 baggers in Peter Lynch's book, One Up on Wall Street which I recommend to anyone interested in stocks.
Great video. Just a little surprised that there is mention of the importance of high ROE and the companies willingness to reinvest back into the business, since it’s a key point of the book.
Good luck finding a high growth, low PE stock in this market 😂 Everything is overpriced AF. I would expect a correction but wtf knows when they’re printing this much money.
If you are sticking to the strategy of this book it means that your holding period will be very long. This in turn means that brokerage fees etc plays a much smaller role, so you could basically go with anything. For the second question, I guess that you must invest a number which you think is significant once you've multiplied it with 100 ;)
Good summary video - value for your 14 minute investment. But the book by Chris Mayer uses a lot of both sound & flawed logic. Logical fallacies abound. For instance, survivor bias: drawing inferences from past history where you assume you made the right decision, back then. But that's bullshit: hindsight is 100% but you don't have that until LATER. What about timing? Different issue: having both sales growth & earnings strength + multiples growth means you have a strong company. But the market should be pricing that into the stock. If you're growing both sales & valuation by 100%, you generally see the market putting high value on them. The stock isn't cheap. So the analysis tells you what you want, helps you pick a target. Then the price has to be right, & that's more likely subject to the vicissitudes of the market. You wait till external events crush the whole market, suck down even superior companies so you can buy them cheap. That means you really do have to time the market, something everyone says investors can't generally do. Buy & hold works, right? You need to buy & hold, count on long-term capital appreciation as a company's strategy & execution pays off over time + compounding of investments kicks in. Sounds great. Buffett did this. "Buy right, then sit tight: this is how to make money in 100 baggers." (10:40) Sure. Buffett proves it. But Buffett's returns weren't amazing before he turned 60. The secret of Buffett's success: don't die. He's doing the 'not dying' part really well, pushing towards 100, so sure, buy & hold compounding returns have hit the steep part of the exponential curve for him then had a 30 year run. Most of us will need our money by the time we hit 65 & will be drawing it down: Buffett didn't. Most of us won't have 40 years to go after 60. Buffett did. Bully for Buffett, but I'm not sure his experience can be extrapolated to my situation or yours. Hindsight is 100% There's useful ideas in the book & this video offers a painless summary - if you can figure out how to apply those lessons to your circumstances now, & avoid much of the investment counsel. Don't get sucked into the typical garbage logic trope of investment books: picking someone really successful, explaining how if you were him & made the same right decisions when he did, you'd be successful too. Of course you would. Doesn't mean those decisions were obvious (or everyone else would have had equal success). Doesn't mean the same decisions are obvious today - circumstances are different, to start with. Doesn't mean outcomes will work out the same way going forward from today. Companies we invest in won't repeat their successes the same way. And we're all subject to external circumstances that will be different this time. An obvious example: what if someone had given you an opportunity to buy into one of only two producers of neon gas 5 years ago, pointing out it was absolutely crucial for semiconductor production? Done so at a good price? Sounds good, right? And it was, right up until Putin's artillery wiped out Mariople & destroyed the entire business with an invasion. And you don't even have to find yourself on the losing side: if you purchased the juggernaut of the fruit & veg business in the 1920s, United Fruit, you had the incredible blue chip stock of the US 1920s. Even WW2 wouldn't derail them, right? Wrong. United Fruit is gone. Picking lessons like this from hindsight - stock in trade for investment books - is a logical fraud. Push back Am I full of shit? Argue back & point out what I've overlooked or gotten wrong. I'm interested, legitimately DO want to improve. Just not too impressed with much of what I find in investment counsel. I keep seeing what appear to me to be obvious logical fallacies that produce good sales stories (for book authors & esp investment managers who charge me too much) but won't benefit me.
However, this contradicts the findings and studies that show that small growth stocks tend to perform poorly (e.g. compared to small value stocks). Presumably, all such stocks (small cap growth) would have to be analysed and not the few extremely successful ones. Then the results could be quite different. It is probably not possible to determine the potentially successful companies in advance. In this case, the book is fascinating but useless.
The one about "ignoring macro analyst". I feel like it is subject to "survivorship bias". The surviving company that actually be a hundred bagger is of course in the big picture doesnt care by the macro, but there will be also many company with good management, healthy growth et cetera but died because of major change in policy.
In my view it is not macro policy but if a company in China moves into your market. The Solar panels business was headed towards 100 bagger until China companies stole the technology and under cut the price. In the communications sector Huawei was about to take over the sector until they were banned. If a Chinese company goes after a product they will undersell it until the company that developed the product dies.
@@MrL702 I agree. Furthermore, it must be considered that one invests only a fraction of his/her capital in a potential 100 bagger, for example 10%, so that, even in the lucky case in which this happens, he will have obtained a 10 bagger. With an ETF, on the other hand, larger capitals can be invested and the final return will be better than the theoretical one of 100x on a single stock.
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Twin Engines: The 1+1 > 2 ideas are correct. But the twin engines described in the video are somehow wrong. The absolute Dual Engines are: The Growth in Earning exceeds the Growth in Capital Invested & The Strength of ROIC exceeds the Cost of Capital Rate.
What a wonderful presentation!!! Love it!! Nobody explains about baggers anymore they just talk nonsense and promote very bad companies. Take for example NIO and PLTR I believe the RU-vidrs that promote these stocks are very irresponsibles. But people must learn to learn first with the right investors and invest later.
Hi, Great video. By any chance do you have any video/ links on tools which I use to filter out companies in the stock exchange based on the Earnings, P/E, dividend, ...... ? Highly appreciate
a 10 bagger is a grand slam, a home run with 3 men on base to start (aka bases loaded.) The man on 3rd gets a base, 2nd gets 2 and 1st gets 3; add in your 4 for a home run and you have 10 bases.
Very interesting video and thank you for the hard work you put into this so a newbie like can have ready resources to learn from. My question is since you made this video, what companies would my list as future 100 baggers? I am starting late with investing. But do have large amounts of sums to invest so just started doing my research. Is there a way I can DM you for some suggestion and questions please?
Super! I wonder how some people are so patient for 26 years average and others are not - its the temperament. Not the intellect - 26 years is long and one needs to resist thousands of Venusses….one deserves a Prize after that…
Tesla, the trade desk, mastercard, amd to name a few. I think i have potential multi baggers in the making stoneco, lemonade, virgin galactic, crowdstrike
@@TheSwedishInvestor I could do way better than that betting on sports 😎✌ already hit 1 under in the yankees game and I'll hit 2 out of 3. I dont know shit about stocks but I know how to select ipos but I need like 100k+ and I'm not there yet :(( like pelotons ipo or Robinhood when it comes out ect 👍 anyways I called several ipos that all made money and I know that's worth something to someone haha......so I have pieces to the success puzzle I just havent fully put it together ;) sept 2nd 2019
Well, it already is basically 100 times the value since its IPO. If it id grows another 100 times, it means people expect it to gain a monopoly in the car and truck market.
Can you please summarize the book "Cracked it how to solve big problems and sell solutions like a top strategy consultant" that would be great help because i can't find it in my country.
6:00 How is that a 300% increase?! Current Market Cap: 200M×15=3B New Market Cap: 400M×30=12B You increase Sales and P/E by 100% each, i.e. factor 2, that means you increase Market Cap by 2×2=4! Or am I missing something?!
Hey YassoKuhl! This is a very confusing one (and I often make the mistake myself), but a 300% increase means that you add 3x to the already existing 1x. So that's a total of 4x, if that makes sense. Just consider that a 100% increase makes something 2x of what it was before and you can go from there.
@@TheSwedishInvestor Ah, gosh! I confused myself. Sorry! Thanks for the quick answer and the great content! Been binging your videos for the last couple of days. I suppose I should buy some of those value investing books now ^^
Hey everyone, I'm currently trying to find out how one could make the lives of busy traders a lot easier ;) Which is why I have two very simple questions: 1. As a career-oriented individual, what are the 2 biggest issues you're dealing with when trying to stay healthy? 2. When it comes to balancing career with peace of mind and physical health, what would you wish for more than anything else? Thanks so much in advance - looking forward to reading your answers
Working as a management consultant: 1. Having time for cooking and for exercising (gym) during projects which require more attention and overtime than usual 2. Being able to completely shut out work. This is especially a problem during weekdays, but on weekends and sometimes during paid vacation too.
