Philip Fisher was a trailblazer in the world of growth investing and is often regarded as one of the most influential investors of the 20th century. His groundbreaking book, “Common Stocks and Uncommon Profits,” laid the foundation for many modern investment strategies and left a lasting impact on generations of investors, including the legendary Warren Buffett. In this article, we’ll dive deep into his biography, dissect his investment strategies, explore his invaluable tips for investors, and highlight some of his favorite assets. We’ll also discuss his enduring influence on the investment world and the legacy he left behind.
Who Was Philip Fisher?
Biography of Philip Fisher
Early Life of Philip Fisher
Birth and Childhood: Philip Arthur Fisher was born on September 8, 1907, in San Francisco, California. From a young age, he exhibited a strong interest in economics and finance.
Family: Fisher grew up in a wealthy family that valued education. His parents encouraged his intellectual curiosity and his interest in the financial world.
Teenage Years: During his school years, Fisher showed a keen interest in mathematics and science, subjects that helped him develop the analytical skills that would later define his career.
Education of Philip Fisher
Schooling: Fisher attended the local high school in San Francisco, where he excelled academically.
University: He studied at Stanford University, earning a bachelor’s degree in economics in 1928. During his time at Stanford, he developed a deep passion for the stock market and corporate analysis.
Early Career of Philip Fisher
First Jobs: After graduation, Fisher began his career at the Anglo-London Bank, gaining practical experience in banking and corporate analysis.
Early Successes: In 1931, amid the challenges of the Great Depression, Fisher founded his own investment firm, Fisher & Co. His disciplined investment strategies and thorough company analysis quickly led to impressive results.
Development of His Investment Philosophy: Fisher crafted a unique investment philosophy centered on in-depth company analysis and identifying growth opportunities. His methods were later immortalized in his seminal book, “Common Stocks and Uncommon Profits.”
Philip Fisher’s Investment Strategy
Philosophy
Growth Investing:
Philip Fisher was a pioneer of growth investing, seeking companies with significant growth potential. He believed that these companies would yield the best returns over the long term.
Famous Quotes:
“The best investments are in companies that have exceptionally good long-term growth prospects.”
“The stock market is a device for transferring money from the impatient to the patient.”
Qualitative Analysis:
Fisher placed immense importance on the qualitative aspects of a company. He believed that factors such as management quality, innovation, and market position were crucial to long-term success.
Keys to Success of Philip Fisher
Thorough Research:
Fisher was known for his exhaustive research, asking numerous questions to assess a company’s quality and growth potential. He often spoke with customers, suppliers, competitors, and former employees to gain a comprehensive understanding.
Long-Term Perspective:
Fisher invested with a long-term view, often holding positions for decades. He believed that patience and discipline were essential to investment success.
Focus on Management Quality:
Fisher emphasized the importance of strong and capable management. He sought companies led by visionary yet pragmatic executives.
Tips from Philip Fisher
General Advice
Invest in Quality Companies:
Fisher advised investors to focus on high-quality companies with strong growth prospects. “Look for exceptional companies and hold them for the long term,” he recommended.
Conduct Thorough Research:
He stressed the importance of rigorous research and analysis. “Ask questions and listen carefully,” Fisher often said.
Personal Recommendations of Philip Fisher
Books:
Philip Fisher authored several books, including “Common Stocks and Uncommon Profits” and “Paths to Wealth through Common Stocks.” These works provide deep insights into his investment philosophy and strategies.
Life Principles:
Fisher placed great importance on integrity, discipline, and continuous learning. He believed these principles were crucial both in investing and in life.
Fisher’s Favorite Assets
Investments
Major Holdings:
Fisher invested in companies he believed had long-term potential. His portfolio included major technology firms and innovative leaders across various industries.
Successful Strategies:
Fisher employed a range of strategies, including investing in companies with strong management and significant growth potential, to achieve stable returns.
Historical Successes
Iconic Investments: Among Fisher’s most successful investments were Texas Instruments and Motorola, which brought him significant profits and cemented his reputation as a top-tier investor.
Long-Term Gains: Fisher held many of his investments for decades, allowing him to reap the benefits of long-term value appreciation.
Philip Fisher’s Top 10 Investments
- Texas Instruments: Fisher recognized the potential of Texas Instruments early on and benefited from its impressive growth in the tech industry.
- Motorola: He invested in Motorola and held the stock for many years, which resulted in substantial gains.
- Hewlett-Packard: Fisher backed Hewlett-Packard due to its innovation and strong market position in the tech sector.
- Dow Chemical: He saw potential in Dow Chemical and profited from its steady growth and strong earnings.
- IBM: Fisher was impressed by IBM’s innovation and dominant position in information technology, leading to a long-term investment.
- DuPont: He identified DuPont’s potential as a leading chemical company and invested in its stock for the long haul.
- Boeing: Fisher invested in Boeing, recognizing its leadership in the aerospace industry.
- Raytheon: He was convinced of Raytheon’s strong growth potential in the defense sector and invested accordingly.
- 3M: Fisher saw the potential in 3M and profited from its innovation and market leadership in various industries.
- General Electric: He invested in General Electric, impressed by its innovation and diversified business model.
Influence and Legacy
Impact on the Investment World
- Teachings and Principles: Fisher’s investment principles and strategies have influenced generations of investors. His books and lectures remain vital sources of knowledge and inspiration for investors around the globe.
- Philanthropy: Beyond his investment career, Fisher was dedicated to charitable causes. He supported numerous educational and research projects, contributing to the advancement of knowledge and social justice.
Sustainability and the Future
- Commitment to Education: Fisher was deeply committed to promoting education and financial literacy. His books and teachings have inspired and educated countless investors.
- Future Prospects: Fisher’s principles of growth investing and qualitative company analysis will continue to be relevant. His influence on the financial world and society will endure, inspiring future generations of investors.
Conclusion: This was Philip Fisher
Philip Fisher was a remarkable investor and economist whose strategies and principles are still admired and applied by many today. By studying his tips and methods, you can gain valuable insights and improve your own investment strategies. His life and work stand as a powerful example of the importance of discipline, patience, and qualitative thinking in the world of finance. The top 10 investments of Fisher illustrate how he identified companies with strong long-term potential and held on to them, reaping high returns over years and decades.
