Lawrence A. Cunningham Quotes

#1. companies that tie up very little extra working capital with incremental sales tend to be more attractive.

Lawrence A. Cunningham

#2. Gross profit margin demonstrates competitive advantage: it is the purest expression of customer valuation of a product, clearly implying the premium buyers assign to a seller for having fashioned raw materials into a finished item and branding it.

Lawrence A. Cunningham

#3. Common sense is the heart of investing and business management.

Lawrence A. Cunningham

#4. sustained high gross profit margins relative to industry peers tends to indicate durable competitive advantage. Zeroing

Lawrence A. Cunningham

#5. Valuation premiums of quality companies often reflect some degree of expected operational outperformance, but actual performance tends to exceed expectations over time. Stock prices thus tend to undervalue quality companies.

Lawrence A. Cunningham

#6. Asset-light industries are attractive since they require less capital to be deployed in order to generate sales growth. The finest examples are franchise operations, such as Domino's Pizza, where growth is funded by franchisees rather than by the company. Other

Lawrence A. Cunningham

#7. we are confident that the fundamental principle of long-term ownership of quality companies is a sensible one, new

Lawrence A. Cunningham

#8. The value any business creates, listed or not, is determined by the rate at which it deploys incremental capital. And

Lawrence A. Cunningham

#9. best businesses to own are those in which end markets are growing rather than shrinking. Absent

Lawrence A. Cunningham

#10. high capital intensity companies can also be attractive, especially where the capital requirement confers stability and deters entrants.

Lawrence A. Cunningham

#11. To achieve sustained high returns on capital requires possessing features that protect returns from competition; namely, competitive advantages. Identifying what these competitive advantages are and understanding their sustainability is an essential part of the quality investment process.

Lawrence A. Cunningham