This Is My Top Performing Stock, What's Yours?

Key Concepts

• Long-Term Investing: Holding onto stocks for extended periods.
• Founder-Led Companies: Businesses where the original founder remains in a leadership role.
• Future-Shaping Businesses: Companies that are innovating and influencing the direction of industries.
• Valuation Concerns: The common criticism of high stock prices relative to current earnings.
• Business Evolution: The ability of a company to transform and expand into new areas.

Amazon as a Top Performing Stock

The speaker identifies Amazon as their all-time top-performing stock, which they have held for over 15 years. Despite feeling they may have been "late to the game," the speaker learned the importance of owning Amazon early in their career at The Motley Fool, through discussions with David Gardner.

Historical Valuation and Skepticism

Even in the past, Amazon was frequently criticized for being "absurdly overvalued" and was doubted to ever generate "meaningful profits." This highlights a recurring theme of skepticism surrounding the company's financial performance relative to its market valuation.

Lessons from Owning Amazon

The speaker emphasizes several key takeaways from their experience holding Amazon shares:

• Business Evolution: Amazon serves as a "great reminder that what a business is today isn't necessarily what it'll be tomorrow." A prime example is the unforeseen impact of Amazon Web Services (AWS), which was not even considered when the speaker initially invested.
• Founder Leadership: The value of having a "founder leader" is a significant lesson.
• The Power of the Long View: The importance of "taking the long view" in investing is underscored.
• Investing in the Future: The speaker advocates for "investing in companies that are shaping our future."

Argument for Holding Winning Stocks

The core argument presented is that while long-term investing doesn't always guarantee success, "when the evidence is clear that it is working, do yourself a favor and hold on to those shares for as long as you can." This suggests a strategy of identifying strong performers and resisting the urge to sell prematurely.

Conclusion

The speaker concludes by sharing their top-performing stock, Amazon, and poses the question to the audience about their own top-performing investments. The overarching message is the power of conviction in a well-researched, long-term investment, particularly in companies that demonstrate significant growth and future potential, even in the face of initial valuation concerns.