Welcome to the Investing for Beginners podcast, episode on capital allocation. Join Dave and Andrew as they explore the importance of capital allocation in investing, discussing its impact on company performance and shareholder returns.
00:00:38 - Introduction to capital allocation and its importance
00:01:26 - Definition and overview of capital allocation
00:04:54 - Discussion of different capital allocation options (dividends, share buybacks, reinvesting, debt reduction)
00:11:05 - Importance of capital allocation and why CEOs often struggle with it
00:15:48 - Metrics for evaluating capital allocation (ROIC, free cash flow, dividend yield, share buyback effectiveness)
00:26:45 - Discussion on debt as a capital allocation strategy 00:29:03 - Examples of companies with good and bad capital allocation practices
00:35:47 - Conclusion and wrap-up
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