The following video is part of our “Motley Fool Conversations” series, in which analyst John Reeves and advisor David Meier discuss topics around the investing world.
As investors, we should take a long-term view of a company we might want to own. And when assessing the people in management, we should expect them to take a long-term view, too. One manager that John and David admired was Jim Sinegal of Costco. He set the long-term vision for Costco's business model. His replacement, Craig Jelenik, has some big shoes to fill, but he knows the Costco way of doing business. Jeff Bezos is another manager with a very long-term vision. Bezos continues to reinvest heavily in the future growth and competitive advantage of his company, even at the expense of current profits. It's not always easy for managers to look to the long term, however. Take turnaround situations such as Best Buy and Hewlett-Packard. They have lots of issues to deal with today, which is why John and David tend to stay away from situations like those.
Making sure your time horizons are matched up with those of the management team is one more way individuals can invest better.