![]() ![]() Concurrently, the market has recognized Halma’s quality. In 2021, the company was named one of Britain’s Most Admired Companies. Notably, given the novel challenges, pandemic-related business disruptions served to illuminate the value of Halma’s value proposition to customers. Over the past ten years, Halma has grown its earnings at about 12% per year, including during the very difficult COVID-challenged 2021. Halma has also been a proficient acquirer and operator of companies. However, quality companies have broadly been bid up in price over the past decade and notably during 2021.įor example, UK-based Halma has been an effectively managed manufacturer of products that help their clients make the world cleaner, safer, and healthier. Historically, quality companies have adapted effectively and evolved appropriately during difficult business conditions, turning challenges into opportunities. While humanity might have learned to live with COVID, there are plenty of other challenges ahead: evolving customer preferences and buying habits rising materials and labour cost inflation growing geopolitical tensions increasing regulatory interventions and so on. The conundrum for investors these days is the trade-off between the value of quality and price to pay for it. Unfortunately, quality companies also suffer from two shortcomings as investments: companies fail to sustain excellence in perpetuity and stocks of excellent companies get bid up in price to reflect their quality, thereby reducing future expected returns. High-quality companies can generate substantial investment gains for investors. ![]()
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