#413 – Bill Ackman: Investing, Financial Battles, Harvard, DEI, X & Free Speech
Lex Fridman Podcast
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How to invest: Find Undervalued companies where mistake happened
Investing effectively requires identifying undervalued companies that have experienced mistakes or setbacks yet possess the potential for recovery. Look for businesses with long-term growth trajectories, strong cash flow generation, and significant barriers to entry that discourage competitors. These characteristics ensure that the company has a sustainable competitive advantage. Avoid overpaying for high-quality businesses as inflated prices can diminish potential returns. Instead, focus on companies being sold at low prices due to disappointed shareholders and a loss of confidence. By investing in these firms and aiding in their recovery, it’s possible to align the stock price more closely with the actual value of the business.
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