When you invest in a business, it can be overlooked that you need to draw a distinction between the per share results of a business and the results of the business itself. It is not enough to say that, say, Apple grew it profits by 10% to figure out what is going on with your wealth, because you do not own the entire business and the capital structure of any business is subject to stock repurchases (which can raise per share profits at a rate higher than the overall growth of the firm) or the issuance of new shares that results in stock dilution (which can cause your share to represent lower profits than the overall growth of the firm).
It’s always there in the background of every business I study. How is that one, single share protected over time?
When I look at a business like Wal-Mart, I see … Read the rest of this article!
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