MI380: Hidden Compounders: The Best Stocks Hiding In Plain Sight w/ Shawn O’Malley
The Intrinsic Value Podcast - The Investor’s Podcast Network
The Investor's Podcast Network
4.6 • 592 Ratings
🗓️ 2 December 2024
⏱️ 50 minutes
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| 0:00.0 | You're listening to TIP. |
| 0:02.8 | On today's episode, I'll be going over the concept of hidden compounders. |
| 0:07.1 | Compounders are, well, companies that have extraordinary track records in compounding earnings |
| 0:11.1 | and returns for shareholders over time. |
| 0:13.4 | I've covered why long-term investors should focus on finding high-quality compounders in last week's episode, |
| 0:18.1 | but in short, owning companies with deep modes, protecting their profit |
| 0:21.2 | margins and opportunities for growth, is a recipe for a success. So this episode will very |
| 0:26.5 | much build on that conversation from last week. While there are some very well-known examples of |
| 0:31.3 | great compounders like Apple and Amazon that might come to mind, hidden compounders are meant to reference |
| 0:35.8 | businesses with phenomenal histories of stacking up returns that are hidden in plain sight. They might have generated some of the |
| 0:41.3 | market's best returns in the past decade or so and still be largely unknown. Hidden |
| 0:45.5 | Compounders are typically companies with boring, unexciting business models or with invisible |
| 0:49.9 | modes, where it's clear the company has some advantage in its favor, but it's difficult |
| 0:53.8 | to pinpoint |
| 0:54.4 | exactly what that is. When I say hitting compounders, think of companies that do things like |
| 0:59.1 | waste management, trucking, or manufacturing airline components. These are unglamorous businesses |
| 1:04.3 | with glamorous returns. Hitting compounders aren't talking about AI or the Metaverse on their earnings |
| 1:10.0 | calls. Their businesses are established and reliable, and they don't talking about AI or the Metaverse on their earnings calls. |
| 1:11.0 | Their businesses are established and reliable, and they don't need to lean into the latest |
| 1:15.1 | trend to try and impress investors. |
| 1:17.9 | You might remember my episode a few weeks back on Monster Beverage, which has been surprisingly |
| 1:21.6 | the best performing stock of the past three decades. |
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