In Praise of Boringly Profitable Companies
Let’s be honest, the investment world has a terrible weakness for a good story. We’re all drawn to the charismatic founder with a grand vision, the disruptive startup that promises to change the world, the stock that’s supposedly going to the moon. It’s exciting, it’s glamorous, and more often than not, it’s a fantastic way to lose your shirt. I find that as the market gets more jittery, there’s a certain quiet satisfaction in turning away from the noise and focusing on a rather old fashioned concept, profit.
I’m not talking about projected, hypothetical, ‘jam tomorrow’ profit. I mean cold, hard cash piling up in the bank, quarter after quarter. It’s a shockingly simple idea, yet one that seems to get lost in the hype cycle.