Quality companies tend to have a strong balance sheet from "summary" of The Little Book That Builds Wealth by Pat Dorsey
One common trait among high-quality businesses is a robust balance sheet. This financial document provides a snapshot of a company's assets, liabilities, and equity at a specific point in time. A strong balance sheet indicates that a company has more assets than liabilities, meaning it has a solid financial foundation and is less likely to face solvency issues. A company with a strong balance sheet typically has ample cash reserves, low levels of debt, and valuable assets. This financial strength allows the company to weather economic downturns, invest in growth opportunities, and withstand unexpected expenses. In contrast, a company with a weak balance sheet may struggle to meet its financial obligations, leading to bankruptcy or financ...
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