Characteristics Of High Quality Listed Companies Worthy Of Long-Term Investment

As we all know, Investment It is a complex and difficult matter, if we can hold a good company for a long time. shares It does not affect the mood of the period, and it persists for decades to be called real long-term value investment. Because it is very difficult to do so, there are so few people who can really do that, so they will be praised by the world. All the investors in the world know Buffett, but maybe few people recognize Buffett, who lives in the town of Obama. Buffett succeeded in acquiring Berkshire Hathaway's listed company in 1963. After that, people in the town saw Buffett as an idol and hero. It was in those two years that thousands of people in the town bought Burke's stock, which was only about $10 at that time. More than 40 years later, most of the people in the town did not sell this stock. Over the past 40 years, there have been dozens of large and small stock disasters on the earth. The economic crisis has also happened several times, and more and more wars, floods and earthquakes have occurred. No matter which time, it may shake your confidence in holding shares. After attending the general assembly of Burke Xia, the reporters interviewed those rich people who had fewer hundreds of shares and tens of thousands of shares. Their common mentality was enough to make all the people moved and shocked. When they were asked whether old age would consider selling their own Burke summer stock, their answer was so consistent - "NO". Rather than Buffett's creation of the richest town in the United States, it is more like those investors who really know value investing have created the Burke summer's highest long-term quality company in the world.

Obama's people hold the stock of Burke Xia because of their confidence in Buffett, but most investors in the world are unable to buy this stock, which needs to be used. Finance Analysis and long term judgement define the quality companies that deserve our long-term investment. If the company has three or six equal grades, the companies all over the world should also strictly classify and screen them. Generally speaking, stocks can be classified as junk stocks, common stocks, growth stocks and high-quality stocks according to some commonly accepted rules and methods. Junk stocks refer to those stocks that are insolvent or whose shares are far more than their own value. Peter Lynch once said to a junk share: "no matter how much money you invest in a junk stock, the end result is that this investment becomes 0". Common stock refers to a large proportion of the "public" stocks that occupy a large proportion of the market. These stocks are almost the same as the market trend; the growth stocks can be divided into many types, and the most popular type of stock in the market is this type of stock. Of course, we must recognize the fact that the share price of a small growing company must be higher than that of a large growing company. On the contrary, the value of investment of large growing company is much higher than those of emerging small growing company. High quality stocks are the stocks of great companies that will never be thrown out in Buffett's eyes. The stocks of great companies are very few and there are few opportunities to buy at the right price. Therefore, it is very successful to capture a truly high-quality company with long-term investment in a lifetime. In my eyes, high-quality companies with long-term investment value should have the following qualifications or characteristics.

First, it must be the industry leader. There are fewer and fewer companies that actually monopolize oligopoly. As everyone knows, only monopoly can create higher profits than average. This is what all investors want to see. I believe there are also leading companies in China such as Coca-Cola, Microsoft and Google. This requires us to continuously track and analyze and grasp.

Second, it must be a non cyclical company. Over the past two years, the stock price of cyclical industries has soared, and stocks of cyclical industries such as nonferrous metals, energy and agriculture have been scrambled. Who has ever thought that once the supply and demand relations change, the share prices of cyclical industries will drop like snowballs. In fact, a truly great company must not be a very strong cyclical company. Buffett and Coca-Cola, which have been held by both sides, belong to the consumer companies. The quality companies such as Moutai and Suning are also not cyclical companies.

Third, the growth rate of net assets must exceed the average level of the industry. Many investors only like to see the growth rate of net profit per share in each fiscal year, while ignoring a more important net asset growth rate. In fact, the most important indicator of a company's steady growth is the growth rate of net assets. The change of net assets growth rate can directly become a criterion for judging whether a company is healthy or not. It is also an important basis for investors to continue to hold shares in the company.

Fourth, the dividend rate must not be lower than that of the three - year treasury bonds. A real long term value investor will never affect his confidence in holding stocks because of market trend changes or external factors, which requires continuous dividends from high-quality companies. The dividend yield per share is a very important standard that can reflect the quality of the company. Although most companies in the market do not pay dividends or pay dividends at present, it can be found that more and more companies have understood what dividends mean to the market and what they mean for the company's stock price level. The improvement of dividend rate is a sign of maturity of the stock market.

Fifth, sufficient cash flow. Cash flow is the blood of a company, Burke Xia. Price of stock All of the world's highest share prices are inseparable from Buffett's cash share. As Buffett said, "sufficient cash flow allows me to buy good things that are cheap and good when I make mistakes in this market". He has more than 30 large and small insurance companies, which provide Buffett with ample cash flow. The huge cash flow provides a lot of imagination for the company's value.

Sixth, investor relations. Whether the shop assistants or bosses understand that "customers are God", listed companies should also understand that "investors are God". A quality company should do more in terms of investor relations, such as updating the company's website information, asking questions, calling investors, and keeping contact with investors who hold their own stocks for a long time.