100 Baggers

Mayer went and found the stocks that returned a hundred to one and worked backwards through what they had in common, which is the right way to do this and almost nobody bothers.

The answer is less exciting than people want. You need a business that can reinvest its own profits at a high rate for a long time, you need to start small, and you need to not sell. That last one does most of the work and it is why the list is short, because almost everybody who owned a hundred bagger sold it somewhere around the third double.

The case I go back to is Monster. It was Hansen Natural, a sleepy juice company, and it did not invent an ingredient or build a factory. It took a product that already existed and repackaged it into something premium for a different customer. Same dirt, same steel, four times the revenue, except in a can.