There is a list of about a dozen or so businesses that I have never gotten a chance to talk about because they have always been overvalued. 3M is one of those companies that is incredibly diversified in a Johnson & Johnson meets Honeywell meets Kimberly-Clark kind of way, and I have known darn well that investors in the stock have been able to sit back, collect their dividend that rises 7% or so every year on average with at least some increase coming in all economic conditions, and reap those 11-13% annual returns.
If your goal is to search for those opportunities that enable you to make a single buy decision, then kick back and become a beneficiary of the passage of time as distribution facilities increase, efficiencies in the manufacturing process are introduced, new products are developed, prices are raised, stock is repurchased, and dividends are paid, 3M … Read the rest of this article!
I’m showing you this video not for the editorial content—one of the deep flaws in arguments about wealth is that, when someone is making $1,000,000 compared to someone making $50,000, the rhetorical question “Does that person really work 20x as hard as the other?” usually follows. The problem with that question is that it equates effort with value.
Imagine someone owns 3.65 million shares, or about 1%, of the Kellogg’s corporation. Because of what he owns, he is delivering $18 million in profitable value to people across the world each year because those people are choosing to take their scarce dollars (which they acquired through work, investing, inheritance, etc.) and buy Rice Krisipies, Frosted Flakes, Fruit Loops, Pop-Tarts, Eggo-Waffles, and so on. A little less than half of that $18 million will show up in the form of $8-$9 million worth of dividend checks that are paid out every ninety … Read the rest of this article!