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10 March 2021
By Maynard Paton
One of my favourite SharePad screens identifies good-quality companies that have grown without acquisition. The screen uses the following filter criteria:
- Positive five-year turnover and operating profit growth;
- A minimum 15% for both return on equity and operating margin;
- Net borrowing of no more than zero (i.e. a net cash position), and;
- A five-year acquisition spend of zero.
I ran the screen the other day and found 28 matches. I studied Best of the Best — or BOTB as it now calls itself — because I was already aware of:
- Some very remarkable financials;
- An extraordinary share-price performance, and;
- Management deciding not to sell the business despite “extensive talks with a range of parties”.