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The Hidden Power of Capital Allocation (And Why Order Matters)
Manage episode 498163048 series 3422773
In this episode of the Investing for Beginners Podcast, Dave and Brian Feroldi from Long-Term Mindset dive deep into the importance of capital allocation and why the order of operations matters. Brian explains the foundational aspects of capital allocation, including reinvestment in the core business, paying down debt, and other strategies for maximizing returns. The discussion covers real-world examples such as Teladoc's acquisition of Livongo and the capital allocation practices of companies like AutoZone, Coca-Cola, and Apple. Learn why understanding capital allocation is crucial for investors, especially those investing in individual businesses, and how to analyze management's decisions for better investment outcomes.
00:21 Understanding Capital Allocation
00:57 Importance of Capital Allocation
04:01 Five Core Options for Capital Allocation
06:34 Case Study: Teladoc and Livongo
07:38 The Order of Capital Allocation
14:33 Framework for Capital Allocation
26:50 Analyzing Capital Allocation Decisions
32:01 Red Flags in Capital Allocation
35:37 Examples of Great Capital Allocation
37:01 Conclusion and Resources
Timestamps are generated by artificial intelligence, and are not 100% accurate depending on the platform used for listening.
More from Brian:
Today’s show is sponsored by:
Go to SHOPIFY.COM/beginners to start selling with Shopify today.
Get your summer savings and shop premium wireless plans at MintMobile.com/beginners
Stop needlessly overpaying for car insurance. Drivers who save with Jerry save over $1,300 a year on average. Download the Jerry app at Jerry dot AI slash Beginners
Squeeze the most out of your Summer with Liquid I.V. Tear. Pour. Live More. Go to LIQUID-IV DOT COM and get 20% off your first order with code INVESTING at checkout.
Leesa has a lineup of beautifully crafted mattresses tailored to how you sleep – without the luxury price tag. Go to Leesa.com, promo code INVESTING for 25% off mattresses PLUS an extra $50 off.
What do Dave and Andrew recommend?
Our #1 recommended stock research platform is FinChat (now Fiscal.ai). Get 2 weeks access for free using our link (no card required): fiscal.ai/ifb
Have questions? Send them to [email protected]
SUBSCRIBE TO THE SHOW
Apple | Spotify | YouTube | Amazon | Tunein
Learn more about your ad choices. Visit megaphone.fm/adchoices
590 episodes
The Hidden Power of Capital Allocation (And Why Order Matters)
The Investing for Beginners Podcast - Your Path to Financial Freedom
Manage episode 498163048 series 3422773
In this episode of the Investing for Beginners Podcast, Dave and Brian Feroldi from Long-Term Mindset dive deep into the importance of capital allocation and why the order of operations matters. Brian explains the foundational aspects of capital allocation, including reinvestment in the core business, paying down debt, and other strategies for maximizing returns. The discussion covers real-world examples such as Teladoc's acquisition of Livongo and the capital allocation practices of companies like AutoZone, Coca-Cola, and Apple. Learn why understanding capital allocation is crucial for investors, especially those investing in individual businesses, and how to analyze management's decisions for better investment outcomes.
00:21 Understanding Capital Allocation
00:57 Importance of Capital Allocation
04:01 Five Core Options for Capital Allocation
06:34 Case Study: Teladoc and Livongo
07:38 The Order of Capital Allocation
14:33 Framework for Capital Allocation
26:50 Analyzing Capital Allocation Decisions
32:01 Red Flags in Capital Allocation
35:37 Examples of Great Capital Allocation
37:01 Conclusion and Resources
Timestamps are generated by artificial intelligence, and are not 100% accurate depending on the platform used for listening.
More from Brian:
Today’s show is sponsored by:
Go to SHOPIFY.COM/beginners to start selling with Shopify today.
Get your summer savings and shop premium wireless plans at MintMobile.com/beginners
Stop needlessly overpaying for car insurance. Drivers who save with Jerry save over $1,300 a year on average. Download the Jerry app at Jerry dot AI slash Beginners
Squeeze the most out of your Summer with Liquid I.V. Tear. Pour. Live More. Go to LIQUID-IV DOT COM and get 20% off your first order with code INVESTING at checkout.
Leesa has a lineup of beautifully crafted mattresses tailored to how you sleep – without the luxury price tag. Go to Leesa.com, promo code INVESTING for 25% off mattresses PLUS an extra $50 off.
What do Dave and Andrew recommend?
Our #1 recommended stock research platform is FinChat (now Fiscal.ai). Get 2 weeks access for free using our link (no card required): fiscal.ai/ifb
Have questions? Send them to [email protected]
SUBSCRIBE TO THE SHOW
Apple | Spotify | YouTube | Amazon | Tunein
Learn more about your ad choices. Visit megaphone.fm/adchoices
590 episodes
All episodes
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