"Any prospectively identifiable moat (and if it’s not prospective, it’s not much use to investors) must be based on inherent qualities of the business. "
keep in mind that a business do change also. The qualities that made a business so great may not translate when the environment changes. We know that there will be businesses in the future but industries change and current ways be management or the business out in itself may not continue to do well if there is no adaptation going on.
It is easy to say adapt or die but when you look at history forms dies to make place to newer ones better adapted to the new conditions. In a sense even if a business entity succeeds in surviving for more than 100 years, it is definitely not the same thing as it was at its beginning or 50 years ago.
keep in mind that a business do change also. The qualities that made a business so great may not translate when the environment changes…even if a business entity succeeds in surviving for more than 100 years, it is definitely not the same thing as it was at its beginning or 50 years ago.
Completely agree!
That’s why we continue to watch and evaluate companies on an ongoing basis (technology companies more so than others). Very few companies are truly buy and never look at again, although many would have worked out that way over long periods, but your investments do need some attention to get the best results.
But at this time, these companies being discussed seem to be doing well and have an advantage at this point in time (but that obviously could change and must be watched).
One of the great benefits of these boards in my opinion are finding out these changes to our investing thesis(es?) from others potentially sooner than we could have on our own.
That’s why we continue to watch and evaluate companies on an ongoing basis
Indeed,I would suggest that the company which is going to last for 100 years and the buggy whip manufacturer who seems like fine going concern at the time, but which fails to adapt, are difficult or impossible to distinguish in real time. Technology makes this more obvious and the change can be quite rapid, but then, many things are rapid these days.
Yet during that 100 years many, probably most, aerospace firms have failed. Or been bought out at fire sale prices. It is hard for an outsider to know which will be agile enough to survive.
I have come into contact with managers like the one you mentioned. It is hard to know whether their attitude comes from reason or envy of managers with superior emergency skills and brain power. Because in this life not all crises can be avoided.
It seems the "durable competitive advantage"comes down to the time span of “durable” . For some traders durable is an hour. Institutions like college endowments can go on for hundreds of years. Plant walnut seedlings and wait…