The key distinctions...

Business Criteria

  • Earning at least a 12% return on equity
  • Producing gross profit margins above 25%
  • Operating with low or no long-term debt
  • Generate consistent sales and profit growth
  • PP&E spending no more than 80% of cash flow

Financial Criteria

  • Earning at least a 12% return on equity
  • Producing gross profit margins above 25%
  • Operating with low or no long-term debt
  • Generate consistent sales and profit growth
  • PP&E spending no more than 80% of cash flow

Growth Criteria

  • Consistent cash-flow
  • can increase customers
  • can increase prices
  • can increase turnover
  • conservatively financed
  • operating in durable industries
  • short term capital payback
  • good gross margins
  • good return on capital
  • book value growth potential