Philip A Fisher
Philip Fisher also began his career as a securities analyst—then a new profession—in the late 1920s. He too published an important book on company analysis entitled Common Stocks and Uncommon Profits in 1958. Like Graham, Fisher also taught that investors should look at the business that lay behind the shares.
By contrast with Graham, though, Fisher saw his mission as seeking out those companies which would produce very strong growth for a long period. He is therefore regarded as one of the pioneers of growth investing.
Also, unlike Graham, Fisher emphasised the importance of what he termed ‘scuttlebutt’. He believed that to find excellent companies, you must speak to management, suppliers, customers, competitors, and whoever else might provide you with information about the company to help you make an investment decision.
Fisher believed there were relatively few excellent quality companies. He proposed that these few had characteristics such as capable and honest management, excellent products, low costs and high margins. Finally, Fisher de-emphasised diversification. Instead, he believed in concentrating efforts. In other words, if you found a great company, researched it thoroughly and were confident of its prospects, you should be able to invest a relatively large proportion of your capital in it.
Further Reading
- Phil Fisher isn’t as well known as Ben Graham but this article, which explains Fisher’s major teachings, also tells you why he’s worth reading.
- To find out more about him, read his Common Stocks and Uncommon Profits.
