Microsoft’s Gross Profit and Return On Equity Secret

The average business in the United States earns a return on equity of 14.5% right now (historically, American businesses have earned return on equity around 12.0%). In 2000, Microsoft was earning return on (unleveraged) equity of 36.0%. By coincidence, in 2019, Microsoft is also earning return on (unleveraged) equity of 36.3%. 

Over the past nineteen years, Microsoft has managed to grow profits from $8 billion to $36.5 billion annually. While some of this is attributable to new products and greater penetration across various global markets, the greater percentage of Microsoft’s growth can be attributed to the greater velocity of Microsoft purchases that occur. In 1999, the average Microsoft consumer made a Microsoft purchase … Read the rest of this article!

Financial Stocks In A Conservative Dividend Portfolio

It’s one of the most intriguing questions when contemplating long-term portfolio planning: What role should finance stocks play when you’re planning to buy things that you intend to hold for 10+ years? On one hand, the demand for things like asset collecting (mutual funds, ETFs, etc.), short-term credit (credit cards), and longer-term lending (bank stocks) is an area that will have perpetual demand. There will always be people directing other people’s investments, there will always be people borrowing money on credit, and there will always be people needing long-term loans to start a business, continue funding a business, buy a home, or whatever requires an infusion of meaningful capital.

On the other hand, … Read the rest of this article!