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October 15, 2024

Measuring the Moat: Assessing the Magnitude and Sustainability of Value Creation

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October 15, 2024

Measuring the Moat: Assessing the Magnitude and Sustainability of Value Creation


Consilient Observer

Measuring the Moat: Assessing the Magnitude and Sustainability of Value Creation

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October 15, 2024

 
 
  • It is critical for investors to assess corporate strategy, which explains how a firm builds a moat around its business that can lead to sustainable value creation.
  • We begin by showing why strategy matters and distinguishing between industry and company life cycles.
  • We turn next to industry analysis to get the lay of the land. We then discuss industry structure, disruption, and vertical versus horizontal integration.
  • We finish with firm analysis. We examine the sources of added value, review pricing decisions, consider the impact of regulation, and then discuss brand value. We include a checklist.
 
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