From "The outsiders" by William Thorndike
-The outsider CEOs achieved extraordinary results by consistently zigging while their peers zagged.
-The outsider CEOs consistently calculated the projected return before starting a project. They believed that the value of the financial projections was determined by the quality of their assumptions, not by the number of pages. Many developed single-page analytical templates that focused employees on key variables. These deceptively simple but analytical one-pagers served as a trigger to invoke Kahneman's slower reflective/analytical System 2
-To Buffett, there is a compelling Zen-like logic in choosing to associated with the best and in avoiding unnecessary change.
-Buffett believes that excellent investment ideas are rare and exceptional returns come from concentrated portfolios. "We believe that a policy of portfolio concentration may well decrease risk if it raises the intensity with which an investor thinks about a business and the comfort level he must feel with its economic characteristics before buying into it"
-Better to change vessels in a chronically leaking boat than to patch leaks
-See's : The Turning point : WB bought See's for $25 million. They had tangible book of $7M and 4.2M in pre-tax profits. They paid an exorbitant 3X book and 6 times pre-tax income compared to Graham's strictures. They saw a beloved brand with excellent returns on capital and untapped pricing power. The company has sent 1.65B in free cash to Omaha in 39 years.
-Buffett's contrarian insight was that companies with low capital needs and the ability to raise prices were actually best positioned to resist inflation's corrosive effects.
-The deals not done were very important.
-Singleton was a very disciplined buyer, never paying more than 12 times earnings and purchasing most companies at lower multiples. Many companies were acquired using Teledyne's pricey stock.
-The outsider CEOs achieved extraordinary results by consistently zigging while their peers zagged.
-The outsider CEOs consistently calculated the projected return before starting a project. They believed that the value of the financial projections was determined by the quality of their assumptions, not by the number of pages. Many developed single-page analytical templates that focused employees on key variables. These deceptively simple but analytical one-pagers served as a trigger to invoke Kahneman's slower reflective/analytical System 2
-To Buffett, there is a compelling Zen-like logic in choosing to associated with the best and in avoiding unnecessary change.
-Buffett believes that excellent investment ideas are rare and exceptional returns come from concentrated portfolios. "We believe that a policy of portfolio concentration may well decrease risk if it raises the intensity with which an investor thinks about a business and the comfort level he must feel with its economic characteristics before buying into it"
-Better to change vessels in a chronically leaking boat than to patch leaks
-See's : The Turning point : WB bought See's for $25 million. They had tangible book of $7M and 4.2M in pre-tax profits. They paid an exorbitant 3X book and 6 times pre-tax income compared to Graham's strictures. They saw a beloved brand with excellent returns on capital and untapped pricing power. The company has sent 1.65B in free cash to Omaha in 39 years.
-Buffett's contrarian insight was that companies with low capital needs and the ability to raise prices were actually best positioned to resist inflation's corrosive effects.
-The deals not done were very important.
-Singleton was a very disciplined buyer, never paying more than 12 times earnings and purchasing most companies at lower multiples. Many companies were acquired using Teledyne's pricey stock.
