Common Stocks and Uncommon Profits

Three of the ideas you’ll keep

The Clif summary of Common Stocks and Uncommon Profits pulls out 7 insights. Here are the first three.

1. The biggest gains go to investors who find the rare company that can grow sales and profits far faster than its industry for many years, then hold it, the mathematics of compounding beats any amount of clever trading.
2. Use the Scuttlebutt method: build a picture of a company by talking to its competitors, customers, suppliers, ex-employees, and researchers. The 'business grapevine' reveals qualitative truths that no balance sheet shows.
3. Judge a company against the Fifteen Points, covering market potential, R&D productivity, profit margins, sales organization, and above all the depth and integrity of management, not just its current earnings or P/E ratio.

The other 4 — and the full 11-minute summary — are in the app.

What’s inside: 8 chapters

The whole summary runs about 11 minutes, read or listened to.

1. Clues from the Past: Why Growth Beats Everything
2. Scuttlebutt: The Business Grapevine
3. The Fifteen Points, Part One: The Business Itself
4. The Fifteen Points, Part Two: People and Integrity
5. When to Buy: Ignore the Forecasters
6. When to Sell: Almost Never
7. The Hullabaloo About Dividends
8. The Don'ts: How Investors Sabotage Themselves