Arthur J. Gallagher ($AJG) podcast mentions
So Matt and John are a little bit more tepid to sour on the acquisition growth strategy. So I'll just give my two cents because I, there's actually a small select group of companies that are these serial acquirers that have done spectacularly for investors. And one of the things that I have found, at least when looking at these types of businesses, is finding those in extremely fragmented but probably mature industries. Insurance brokers, car dealerships, um, companies like these where there's thousands of players in the industry, probably all like regionals or mom and pops and things like that. And you have this corporate, uh, sort of umbrella that you can work from that's like, hey, we've got a cost of capital advantage. We can take all of your back of the house sort of administrative stuff in-house. It's a lot of corporate synergies. And typically when you're buying a mom and pop, Maybe when they're retiring, you can probably buy it at a pretty good price and do it that way. So companies that have that playbook have done extremely well. Uh, the one that I'll just throw out as a great example of this, because I did say insurance brokers, is Arthur J. Gallagher, AJG. Uh, companies like this, it, it, it is a very, very niche tool. And there are companies out there that can do it well. Whether or not a $150 million drone company can do it is, is yet to be seen, but there are companies that have very good track records for it, and seeking out those companies can be good investments over the long term. So I'll just, you know, throw in the counter to what— to the kind of the red flags we're looking at, some of the things you can look for that can help out. But that's all the time that we have for today. As always, people on the program may have interest in the stocks they talk about, and The Motley Fool may have formal recommendations for our guests. Just don't buy or sell stocks based solely on what you hear. All All personal finance content follows Motley Fool editorial standards and is not approved by advertisers. Advertisements or sponsored content are provided for informational purposes only. To see our full advertising disclosure, please check out our show notes.
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