Short term or long term vision?

New stock for our Doubler Portfolio

Sometimes, you buy a stock after just a few days of research. Other times, it takes years before you're convinced.

The company I’m discussing today falls into that second category—not because of the company itself, but due to market conditions. During the pandemic, it experienced a massive boost, and the big question was always: how much would revenue and profits decline once the dust settled?

Now, years later, the company has proven that it can consistently deliver strong results—even despite supply shortages. And with the long-anticipated correction finally seeming to materialize, as excess inventory needs to be cleared, I’m confident that, in the long run, we’re not overpaying.

Over the past ten years, this company achieved an impressive compound annual revenue growth rate of 16%, though it's expected to level off to around 10% in the coming years. During that same period, earnings grew by 33% annually, while maintaining an average return on equity (ROE) of 20.9%. All this with a debt ratio of just 11.3%.

Today, we can pick up this stock at a price-to-earnings ratio of less than 7. This is a textbook example of how investors apply different time horizons when determining fair value.

Yes, there may still be short-term volatility. However, over the long term, I expect returns of 10% to 15%, with limited downside risk for this company.

Let me introduce you to