Broker Check

Lessons from the Big Cat

Love him or hate him, the comeback Masters victory for Tiger Woods was special and has many lessons for investors and everyday people. After struggling with injuries and many personal issues, Woods put in the work and had the right discipline to improve his golf game to its former glory and once again put on the green jacket. The remarkable ascension from years of toiling without golf is a great example of how to rebuild ones skillset as a company or an individual. Will power and dedication to excellence is what separates great companies and individuals from the masses and what we all should strive for in our investments and daily lives.

Always looking for stories and examples that showcase unfathomable recoveries for our best companies, I can easily link Tiger’s victory to many of our current holdings.
Three technology companies immediately come to mind if you go back far enough to remember some darker periods in their history. Apple Inc. (with and without Steve Jobs) struggled for years and almost collapsed into the dustbin of forgotten computer companies before Jobs came back, and now Tim Cook, with the will power and innovative thinking to drive the company to greatness. Cisco Systems and Microsoft had their own dark periods but their survival was never threatened. Leaders during the go-go days of the first internet gold rush of the 1990s both Cisco and Microsoft lost their mojo and were resuscitated with new management and innovation that was absent for a decade or longer. Today, Cisco, Microsoft, and Apple are back on top of their game and striving for greatness among a field of talented challengers.

Today, we question if Facebook, Disney, Wells Fargo, and Bristol Myers have the right stuff and discipline to regain their dominance from earlier periods. I expect that at least two of these significant competitors will find the will power and management skills to rise again to the top of the stock market mountain. The tricky part is figuring out now who those two companies are likely to be. I have my favorites but time will tell and all possess the capability.

My challenge for the next several years is to find and invest in the best companies that will dominate the next wave of innovation in artificial intelligence, deep medicine, 5G communication, and blockchain innovation. I believe this homework assignment is important and worthy of a majority of my effort rather than trying to discern the next correction or acceleration in the stock market over the next month or two.

This week we move into the true beginning of earnings season. If Friday is a good example, the news and reaction may be better than many skeptics believe.

Have a great week,

Roger N. Steed

April 15, 2019

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