Transcript
Introduction
Matt
This is Matt Reustle. And today, we are breaking down D.R. Horton. Our guest is Ed Wachenheim, Founder of Greenhaven Associates. Now to bring you behind the curtain a bit here, when I heard Ed was in for a breakdown, I did my best to treat this professionally, but I will let it be known, I'm a major fan of Ed.
In 2016, Ed wrote a book, Common Stocks and Common Sense. And in the forward to that book, Ed laid out his framework for how he approaches investing. Now I'll spare you my reinterpretation of those words and just recommend the book to anyone or any investor that hasn't read it yet. But in the same way that Michael Mauboussin grounds you in the foundation of fundamental investing, Ed did this in his own form.
And if you ever hear me on the show saying, average companies should trade at 15 or 16 times, Ed really laid out the reasoning for that in his book. And if I had any concern that Ed would live up to my high expectations, that was quickly squashed. What you will hear is an incredible discussion walking through D.R. Horton and the homebuilders broadly, and just how much has changed with this business model over the years.