Coffee-can quality- Some thoughts

11 06 2018

Good read!

BalaBlogs

(This was published in Deccan Chronicle. A few pointers on building a ‘coffee can’ portfolio. )

I mention this terminology “High Quality” stocks quite often, in my writings. Some people have asked me whether I could be specific in defining or explaining what a “High Quality” (HQ) stock is.

Let me put across some characteristics of HQ stocks, as I imagine them to be.

  1. Longevity with Pricing Power

In this era of technological change, life cycles of companies are shortening. So what it means to find HQ is a tough task. Many years ago, we used to talk of NOKIA as a HQ stock. We thought it would last forever. Or Kodak (do not know how many of this generation even know the brand name ‘kodak’). Even a mighty company like General Electric has metamorphosed.

At the same time, we have companies like Unilever, P&G, Gillette, Cummins, 3M etc which…

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