05-02-2015, 02:59 PM
Points very well made guys. I guess my high bar for admittance comes from the fact that I'm already pretty heavy into industrials (and I still don't own some of the ones I want), and there are 20 on my watch list. And that doesn't count transportation & distribution companies, railroads, or heavy construction, which I put into other categories.
I've read the PH shareholder letter and downloaded the IR app, which has a bunch of videos that attempt to describe each of their market segments (although in more of a promotional way than a deep dive). What I came away missing was the source of a moat. With UTX, the story for me is that they sell razors and blades in the form of elevators and jet engines, both of which have major barriers to entry in the form of time and investment, and both of which make money from long-term maintenance contracts, which are a virtually unassailable source of future earnings. PH has produced a higher rate of dividend growth however by selling valves, hoses, fittings and electric motors, and thousands of other things. I'll keep it on my watch list and maybe dig into it again when the inspiration strikes.
I've read the PH shareholder letter and downloaded the IR app, which has a bunch of videos that attempt to describe each of their market segments (although in more of a promotional way than a deep dive). What I came away missing was the source of a moat. With UTX, the story for me is that they sell razors and blades in the form of elevators and jet engines, both of which have major barriers to entry in the form of time and investment, and both of which make money from long-term maintenance contracts, which are a virtually unassailable source of future earnings. PH has produced a higher rate of dividend growth however by selling valves, hoses, fittings and electric motors, and thousands of other things. I'll keep it on my watch list and maybe dig into it again when the inspiration strikes.