Philip Fisher

Overview

"Common Stocks and Uncommon Profits and Other Writings" by Philip Fisher is an influential investment book that offers valuable insights on how to identify successful stocks. Philip Fisher, a renowned investor and author, shares his experiences and expertise, providing readers with a comprehensive guide to achieving long-term investment success. The book was first published in 1958 and has since become a classic in the field of investing.

Key Points / Ideas

1. Importance of understanding the business: According to Fisher, before investing in a stock, it is crucial to thoroughly understand the business behind it. He emphasizes the need to evaluate a company's management, competitive advantage, growth prospects, and financials.

2. Long-term perspective: Fisher advocates for a long-term investment approach. He suggests identifying companies with solid long-term growth potential and holding onto them even during market fluctuations. Patience and discipline are key.

3. Scuttlebutt method: Fisher introduces the concept of "scuttlebutt," which involves gathering information about a company through various sources like suppliers, competitors, customers, and employees. This approach helps investors gain insights beyond what is publicly available.

4. Marginal thinking: Fisher advises investors to analyze a company's potential for future growth, rather than focusing solely on its current performance. By identifying the factors that can significantly impact a company's success in the future, investors can make more informed investment decisions.

Significant Evidence and Examples

To support his arguments, Fisher provides numerous real-world examples and case studies. He shares anecdotes from his own investment career, highlighting successful investment opportunities that arose from careful analysis and understanding of a company's business.

Fisher also emphasizes the need for detailed research and seeking information beyond financial statements. He illustrates this point by recounting specific instances where personal investigations conducted through the scuttlebutt method led to valuable insights and investment decisions that proved successful.

Conclusion

"Common Stocks and Uncommon Profits and Other Writings" is a seminal investment book that provides valuable guidance for investors. By emphasizing the importance of understanding a company's business, taking a long-term perspective, employing the scuttlebutt method, and considering future growth potential, Fisher offers a comprehensive framework for successful investing.

Readers who want to gain a deeper understanding of investment strategies and enhance their decision-making process would find this book highly valuable. It is worth noting that some of the examples and methods might be outdated due to the book's publication date, but the core investment principles presented by Fisher remain relevant today.

For those interested in further readings on investing, similar books like "The Intelligent Investor" by Benjamin Graham and "A Random Walk Down Wall Street" by Burton Malkiel offer additional perspectives and insights to explore.