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Episode 76: Operating Performance Ratios (Margins and the DuPont Machine)
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Episode Summary
This episode addresses the ultimate question for any company investor: "Is this actually a good business?". We show why looking at the headline profitability metrics in isolation can be incredibly misleading. Specifically, we explore how three entirely different companies—a manufacturer, a retailer, and a software firm—can all report an identical, stellar return on equity (ROE) of twenty-four percent, yet possess completely different operational machinery.
By unpacking the…
The skinny
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