462- A Third Kind of Capital
Free cash flow can be a golden ticket in the hands of a company with the right leadership.\xa0They can use it to supercharge innovation, expand their reach, or reward shareholders with dividends or buybacks, and for value investors, it\u2019s like spotting a diamond in the rough.\n\nAfter the growth and maintenance expenditures are accounted for, the way a company deploys its additional capital can signal the strength of management and the potential for future returns.\xa0As Buffett tells us in his recent letter, once you\u2019ve got companies that check all of the boxes he\u2019s looking for, this is the icing on the cake.\n\nJoin Phil and Danielle as they continue their analysis of this year\u2019s shareholder letter from Berkshire Hathaway, pulling out key takeaways that might\u2019ve been overlooked by some readers.\n\nFor help in crunching the numbers in your investment research process, click here to get your free Rule #1 Calculators for Investing Analysis:\xa0https://bit.ly/42dBHSn\n\nTopics Discussed:\n\nIndividual values in investing\n\nEntrepreneurship\n\nSee\u2019s Candy\n\nOperating cash flow\n\nGrowth/maintenance capital expenditure\n\nRare companies\n\n\nResources Discussed:\nBerkshire Hathaway shareholder letter\n\nLearn more about your ad choices. Visit megaphone.fm/adchoices