Post #60 by Indefensible on the Investing Beginners board

Personal Finance Topics / Investing Beginners

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"What am I misunderstanding in Buffett's statement? Or am I just completely wrong in my assessment of reinvestment in the company?"

Hi AnomolyInvestor,

I think Buffett is making a casual observation that a company growing profitably without much additional investment required is better than one that does require further investment, all other things being equal. So in your example, company A & B may have similar growth rates/ profits but A does not need to invest to achieve it (Capex requirements are different).

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