Benjamin Franklin: The Way To Wealth

Happy 4th. I include below one of my favorite Benjamin Franklin passages, written in 1757 under the guise of Franklin’s alter ego Poor Richard:

Courteous Reader,

I have heard that nothing gives an author so great pleasure, as to find his works respectfully quoted by other learned authors. This pleasure I have seldom enjoyed; for tho’ I have been, if I may say it without vanity, an eminent author of almanacs annually now a full quarter of a century, my brother authors in the same way, for what reason I know not, have ever been very sparing in their applauses; and no other author has taken the least notice of me, so that did not my writings produce me some solid pudding, the great deficiency of praise would have quite discouraged me.

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Hershey-Mondelez $107 Takeover Bid: Five Thoughts

Five thoughts on the news of a possible Hershey takeover beyond what the mainstream news has already reported:

#1. Rationally, Nestle should the highest bidder for Hershey stock. Due to an old agreement with Rowntree (a confectionary business now owned by Nestle), Hershey gets licensing rights to sell Kit-Kat in the United States. Those licensing rights terminate, and revert to Nestle, if a transfer of control occurs at Hershey. About $600 million worth of Kit Kats get sold in the United States every year, which flows through as $120 million worth of profits to Hershey shareholders. Assuming, in a takeover scenario, that those rights are worth 25x earnings, then Nestle ought to be willing to pay $3 billion more to acquire Nestle than any other competitor.

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Computershare FAQ: Is Computershare Safe?

Computershare is one of the biggest sources of inquiries that I receive through my site’s e-mail address. There seems to be a lot of people out there who wonder what Computershare is, and whether Computershare is a safe source to purchase stocks through.

The short answer: Computershare is possibly the most legit source you can choose to purchase stock. When a company goes public through an IPO, or wants to raise capital through an additional offering, it is the issuer and must keep track of who the shareholder base is. As you can imagine, that is a complicated and ever-changing job, and something that most companies have no interest doing.

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Alphabet Stock: High Chance Of Outperforming S&P 500

From a psychological point of view, I find that growth at a reasonable price investing is far more satisfying than deep value investing.

If you overpay for a strong company, you know that the passage of time is your friend. With each earnings report that propels the earnings per share rate ever higher, you get to see the intrinsic value of your ownership position increase in value. It’s fun owning things where the question is: “How much did the profits grow this year?” When the underlying profits are growing quickly, it is easy to dismiss moments when the stock price lags the growth in earnings. If earnings grow by 15% in 2016, and the stock price only advances 5%, there’s no real cause for concern unless you dramatically overpaid at the outset.

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