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Return on Capital — Scuttlebutt Investor

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“Leaving the question of price aside, the best business to own is one that over an extended period can employ large amounts of incremental capital at very high rates of return.” – Warren Buffett, 1992 Berkshire Hathaway Shareholder Letter Return on Capital or Return on Invested Capita

“Leaving the question of price aside, the best business to own is one that over an extended period can employ large amounts of incremental capital at very high rates of return.” – Warren Buffett, 1992 Berkshire Hathaway Shareholder Letter Return on Capital or Return on Invested Capital (ROIC) is something I think about a lot. The list of metrics I look at when I analyze businesses is long: revenue growth, operating margins, free cash flow, payout ratios, etc. But if I could look at only one metric about a business to judge the quality of that business- ROIC would be the metric. Good businesses

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