IWF Australia member and CEO of Morningstar Australia was interviewed recently by Live Mint Business News explaining the concept of companies with “economic moats,” — those that have the potential to keep earnings growth secure from competition for long periods of time.
“A wide moat is where we think the excess return on capital can be achieved for the next two decades, and that is very hard to achieve. There are only about 200-250 companies globally that we give a wide moat rating to. Narrow moat means we expect excess returns for the next 10 years. It’s still a long time and hard to attain, but it’s much more available.”
Heather Brilliant, CFA, is chief executive officer of Morningstar Australasia. Before assuming this role in 2014, Brilliant was global director of equity and corporate credit research for seven years. In this role, she led Morningstar’s global equity and corporate credit research teams, consisting of more than 120 analysts, strategists, and directors. She also served on Morningstar’s Economic Moat committee, a group of senior members of the equity research team responsible for reviewing all of the firm’s Economic Moat and Moat Trend ratings.
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