{"id":8056,"date":"2013-04-19T12:45:40","date_gmt":"2013-04-19T07:15:40","guid":{"rendered":"https:\/\/www.moneyworks4me.com\/investmentshastra\/?p=8056"},"modified":"2024-03-11T15:03:07","modified_gmt":"2024-03-11T09:33:07","slug":"philip-fishers-strategy-of-investing-in-right-stocks","status":"publish","type":"post","link":"https:\/\/www.moneyworks4me.com\/investmentshastra\/philip-fishers-strategy-of-investing-in-right-stocks\/","title":{"rendered":"Look for the Right Stocks – The Philip Fisher way"},"content":{"rendered":"

“I don’t want a lot of good investments; I want a few outstanding ones.”<\/strong><\/em><\/p>\n

These words reflect the modesty of Philip Arthur Fisher, who, with his 70+ years of successful investing experience, is considered the pioneer and the mastermind of the growth stock school of investing.<\/strong><\/span><\/p>\n

\u00a0About Philip A. Fisher\u2026 (1907-2004)<\/span><\/span><\/h3>\n

Philip Fisher<\/a>, a 1928 drop-out of Stanford Business School, worked as analyst in Anglo-London Bank (San Francisco), switched to a stock exchange firm, and subsequently moved on to start his own money management business, <\/span>\u2018Fisher & Co.\u2019<\/strong> in 1931.<\/span><\/p>\n

His biggest investing success dates back to 1956, when he acquired a lot of stock in Texas Instruments<\/strong><\/span>, long before it went public in 1970. It was first quoted at around $2.70, and went on to go as high as $200 – a rise of 7,400%, that too, without dividends. Fisher’s own gains were significantly higher, given the fact that he had bought the shares privately, and much before the company went public.<\/p>\n

Fisher on Investing:<\/span><\/h3>\n

While Benjamin Graham advised investors to invest in companies with well-established track records available at low valuations;, Philip Fisher\u2019s investing guidance was more towards seeking out truly outstanding businesses and willing to pay even higher valuations in exchange for the prospect of much higher returns.<\/strong><\/span><\/p>\n

Broadly, Philip Fisher can be seen as a long-term investor in well-managed high quality growth companies at reasonable price. Specialized in innovative companies driven by R&D<\/strong><\/span>, Fisher’s main interest was to find growth stocks; companies that had a technological edge on their competition which they could use to their advantage to compound their returns over the very long time scales. He was prepared to hold it for over fifty years in some cases. He was one of the initial professional investors to recognize the merits of hi-tech firms like Motorola and Texas Instruments when they were starting out.<\/p>\n

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His Investment Philosophy:<\/span><\/h3>\n

Out of the many ways in which Philip Fisher contributed to the acumen of the intelligent investor, the 2 indispensable ideas that hold a special place, which can be found in his investment classic \u2018Common Stocks and Uncommon Profits\u2019<\/strong>,<\/span> the first investment book ever to make The New York Times bestsellers\u2019 list, are:<\/p>\n