Henry Singleton, Outstanding Capital Allocator

I first heard of Henry Singleton, CEO of Teledyne by reading The Outsiders: Eight Unconventional CEOs and Their Radically Rational  Blueprint for Success, which shares the stories of great capital allocators of all times. Then, I received this presentation about him presented by Leon Cooperman from Omega Advisors in the Value Investing Congress of 2007.

Singleton was able to buy over 100 companies in the “Conglomerate Era” and then, in the ’80s, reaped the benefit of shrinking the total share count from 40 million to 12 million shares, without using debt, at low multiples.

His entire strategy used very little debt, with return on assets being very close to return on equity (ten-year ROA of  18,1% versus ten-year ROE of 19,3%). Despite not being a MBA student, he taught us a outstanding class on financial engineering.


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s