Getting Information on Competitive Strengths and Excess Returns

This is primarily a qualitative assessment. Reading articles on the firm and the sector in which it operates is a good starting point. Looking at the differences across firms in the sector on size, margins, working capital ratios and risk can also provide a basis for the competitive analysis. A useful comparison would be between the excess return (return on capital - cost of capital) earned by your firm and the average excess return earned by the sector. Online sources of information:

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Lessons From The Intelligent Investor

Lessons From The Intelligent Investor

If you're like a lot of people watching the recession unfold, you have likely started to look at your finances under a microscope. Perhaps you have started saving the annual savings rate by people has started to recover a bit.

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