I would also consider the cost base, some companies like Costco and RyanAir have an incredible ability to keep costs low which keeps them profitable. A ‘bonus’ metric would be operating leverage. If you can generate additional revenues with costs increases at a slower rate, you set yourself up for margin expansion.
Based on channel checks (creatives I track who sell on Etsy) Etsy seems to be struggling this year in the US. They may have initiatives planned to reverse this but their moat is weakening in my opinion
Restacking! Great breakdown of how successful companies protect their profits - worth sharing because it shows clear ways to spot businesses that can stay ahead of competition. The analysis of companies like Adobe and Etsy, plus the useful charts showing how brand power connects to profits, helps make sense of what makes some companies more valuable than others.
Nice article but aaaahhhh stop capitalising moat! It doesn't stand for anything!
Well, there may be an explanation to it 😀 https://x.com/atmosinvest/status/1778769672805978190?t=286Co9o5er7pi83nQezonA&s=19
I would also consider the cost base, some companies like Costco and RyanAir have an incredible ability to keep costs low which keeps them profitable. A ‘bonus’ metric would be operating leverage. If you can generate additional revenues with costs increases at a slower rate, you set yourself up for margin expansion.
Great comment! Operating leverage is an underrated metric for more mature companies. You don't need 20% revenue growth to get solid retuns.
Based on channel checks (creatives I track who sell on Etsy) Etsy seems to be struggling this year in the US. They may have initiatives planned to reverse this but their moat is weakening in my opinion
Thanks for the information!
Restacking! Great breakdown of how successful companies protect their profits - worth sharing because it shows clear ways to spot businesses that can stay ahead of competition. The analysis of companies like Adobe and Etsy, plus the useful charts showing how brand power connects to profits, helps make sense of what makes some companies more valuable than others.