One-time investment can lead to sustained and certain output

Assets that can continue to provide investors with stable returns are called cash cow assets.

Cash cow companies are increasingly favored by capital

There are extremely high barriers in the industry and there is a certain degree of monopoly, or the industry itself is a relatively closed monopoly industry.

It can have a strong impact on costs and profits, and the company can continue to develop stably.

Have the attributes of sustainable operation

Stable performance, a large amount of cash on hand, regular dividends, and high dividend attributes

The stock price grows evenly and steadily, the company has strong ability to withstand market shocks, and the stock price and dividends are not significantly affected by macro trends.

Theoretically, cash cow stocks can travel through the bull and bear cycles. The bear market may not necessarily fall, and the bull market may not rise.

The business model is relatively fixed and no longer requires excessive brand promotion or technology research and development investment.

Different industries have different characteristics

Brand effect, or the "uniqueness" of the product itself, has a strong irreplaceable effect. Enterprises can steadily gain market share and returns without requiring additional R&D investment.

If the debt ratio is low and cash is abundant, if the market is not good, then the price will be reduced to make profits; if the economy is good, the price will be increased to increase profits.

Enterprises have long-term tolerance for price fluctuations

Liquor: an industry with stable profits, very stable gross profit margin, brand effect and abundant operating cash, short-term stock price fluctuations are completely acceptable

Part of the pharmaceutical industry: secret recipes/raw materials are irreplaceable and can generate strong brand effects

Sometimes it is disturbed by macroeconomics and policy strategies. The macroeconomic situation is not good, and the stock price is under pressure. The economy is improving, both volume and price are rising, and price increases are boosting.

Greater investment in fixed assets

Infrastructure: High debt ratio, with a strong moat, relying on strong economies of scale to make profits, such as power infrastructure, highways, etc., similar to a perpetual annuity, with a one-time investment and permanent income. Corporate fundamentals are almost unaffected by the market, with stock prices relatively stable and dividends stable. Also note that abundant cash flow in a bull market can overly push up stock prices, which will then experience volatility and return to normal.

Mineral resources: large initial investment and high barriers to entry. Minerals have non-renewable scarcity and independent industry cycle attributes. Ignore macro cycles and stock market cycles. Coal, for example, performs well in the second and third quarters of each year, and nonferrous metals perform well when the economy recovers or liquidity is abundant.

New energy minerals: Demand is growing day by day. After the industry ends its downward cycle, prices have begun to stabilize, driving industry profits to rebound.

Financial industry: It has thresholds, license and large investment requirements, government credit attributes, and natural barriers.

Technology monopoly: In the field of new energy, there is continuous investment in technology research and development, and product iterations

Chemical industry: the right to speak similar to secret medicine