Henry Singleton

“Singleton, in contrast, ran Teledyne for almost 30 years, and the annual compound return to his investors was an extraordinary 20.4%.”

“If you had invested a dollar with Singleton in 1963, by 1990 when he stepped down, It would have been worth a 180.”

“He believed that what counts in the long run is the increase in per share value, not overall growth or size.”

“He believed that cashflow, not reported earnings is what determines long-term value.”

“He believed that sometimes the best investment opportunity is your own stock.”

“Here's a quote from Warren Buffett and Buffett said, Henry Singleton, Has the best operating and capital deployment record in American business. If one took the hundred top business school graduates and made a composite of their triumphs, their record would no…”

“Henry Singleton founded it when he was 43 and had never founded a company before.”

“And between. And 1969, he purchased a 130 companies in industries ranging from aviation electronics to specialty metals and insurance. All but two of these companies were acquired using Teledyne's pricey stock.”

“In mid-nineteen 69, with the multiples on his stock falling and acquisition prices rising, he abruptly dismissed his acquisition team.”

“From this point on, the company never made another material purchase and never issued another share of stock.”

“At headquarters, there were fewer than 50 people in a company with over 40,000 total employees and no human resource or investor relations departments.”

“They devised a unique metric that they called the Teledyne return, which by averaging cash flow and net income for each business unit emphasize cash generation and became the basis for bonus compensation for all business unit general managers.”

“And I think at that point, the previous year, he had, I think, a 130 different business units, and I think a 129 of them were profitable.”

“1972 and 1984 and eight separate tender offers. He bought back an astonishing 90% of Teledyne's outstanding shares.”

“Singleton believed buying stock at attractive prices was self catalyzing. Analogous to coiling a spring that at some future point would surge forward to realize full value, generating exceptional returns in the process.”

“Singleton bought his own stock extremely well and generated an incredible 42% compound annual return for Teledyne's shareholders across the tenders.”

“He invested over 70% of combined equity portfolios in just five companies, with an incredible 25% of his portfolio allocated to a single company, which was his former employer, Litton Industries.”

“Singleton did not believe in detailed strategic plans, preferring instead to retain flexibility and keep his options open.”

“Many of the distinctive tenants of Warren Buffett's unique approach to managing Berkshire Hathaway were first employed by Singleton at Teledyne. In fact, Singleton can be seen as a proto-Buffett, and there are uncanny similarities between the two.”

“Both Singleton and Buffett recognized the potential to invest insurance company float to create shareholder value. And for both companies, insurance was the largest and most important business.”

“So Henry was actually ranked first in his class of 820 people in mathematics. He won the Putnam Award, which is one of the most prestigious and notoriously difficult mathematics competitions in the world.”

“We went into the semiconductor business in 1960, even though we were in the midst of a business crisis at the time, we did it because of our conviction that it was necessary for our long-term future growth and not because of any conviction that we would immedi…”

“Our contention was that smaller units gave management better control and made the local manager fully responsible for the success of their own operations and motivated them to perform well.”

“There are tremendous values in the stock market, but in buying stocks, not entire companies. Buying companies tends to raise the purchase price too high. Don't be misled by the few shares trading at a low multiple of six or seven. If you try to acquire those c…”

“By 1977 Teledyne was the largest shareholder in nine of the fortune 500 companies.”

“We actually held enough shares in six of these corporations to effectively have control over them, but Henry never exercised that capability.”

“The subsidiaries existed to generate cash, and Singleton's job was to allocate that cash.”

“When he dies, I think he's the third largest landowner in the United States at the time.”

“In fact, the book says that he never sold a single piece of real estate, whether it's a house or his ranch or just empty land in his entire life.”

“Through doing the signing, it's amazing how much you learn about the business. There's a reminder of each event or action behind every check.”

“Munger said Henry Singleton was the smartest single human being I've ever known in my entire life.”

“He concluded, Henry was a lot smarter, but Warren had thought about investments a lot longer.”

“Henry Singleton's grades everywhere were a hundred. Three digits squeezed into the space for only two. For every course he took, every final exam, 100.”

“Not the one Henry helped to finance. He invested in Apple.”

“Over the next 12 years, he bought back 90% of Teledyne shares. The result earnings per share exploded a 311% increase in just five years.”

“Warren Buffett once said that Henry Singleton had the best operating and capital deployment record in American business, bar none.”

“From 1963 to 1990, Teledyne, the company that Henry Singleton helped build from scratch, delivered annual returns of 20.4%, while the S&P 500 managed a mere eight percent. If you'd invested 10,000 dollars in Teledyne in 1963, by 1990, you'd have over 1.8 Milli…”

“Throughout the 19 sixties, Teledyne aggressively acquired more than 130 companies. But by 1969, Henry Singleton saw the acquisition prices head soar beyond rational value. Therefore, he slammed on the brakes, stunning Wall Street by making zero new deals.”

“Decades later, he'd become one of America's largest landowners.”

“In 1939, he was on a three-man team that won the William Lau Putnam Prize, an elite math competition. It was MIT's first time winning this award. His teammate? None other than the future Nobel physicist and outlier Richard Feynman.”

“With an internal capital of 450,000, they launched what was originally called Instrument Systems.”

“One technique he used was borrowing against the physical inventories of the companies that they had acquired.”

“And they purchased these companies using Teledyne's highly valued shares, often trading at 40 to 70 times earnings. They more than doubled the share count in the late sixties. But the financial results that followed more than made up for the shared dilution, t…”

“There was a whole team of people at Teledyne who had been taking care of the acquisitions, helping find these companies, working through the acquisition process, integrating them, And they were just laid off all at the same time.”

“There are tremendous values in the stock market, but in buying stocks, not in entire companies. Buying companies tends to raise the purchase price too high.”

“I won't pay 15 times earnings. That would mean I'd be only making a return of six or seven percent, and I can do that in treasury bills.”

“During the 1968 to 74 period, when most investors considered bonds safe and stocks risky, Singleton took the opposite view. He instructed his insurance companies to move away from fixed income securities and toward equities when the stock market was depressed.”

“In an era when virtually no companies bought back shares, Teledyne would conduct eight major share repurchases over the next 12 years, reducing the number of shares outstanding by more than 90%.”

“Shareholders who stayed with Teledyne from the first buyback in 1972 achieved gains of approximately 3000% by 1983, transforming many patient investors into multi-millionaires.”

“When American TV manufacturers still dominated the US market, Singleton anticipated the coming Japanese competition and exited the business entirely. This shocked industry observers. Packard Bell had a good market share and solid profits, but Singleton saw the…”

“In the end, what made Teledyne remarkable wasn't just Singleton's financial wizardry or Robert's operational discipline, but the seamless integration of the two, while most conglomerates of the era were ultimately dismantled or vastly underperformed the market…”

“Among over 1000 major American companies, Teledyne ranked 12th in profitability, 15th in growth, and sixth in market performance. In the multi-companies category, Teledyne was first in return on equity, first in return on total capital, and second in growth in…”

“The same year, Singleton conducted his eighth and final major stock buyback, acquiring 8.6 million shares at 200 dollars per share, approximately 30 dollars above the market price. This reduced Teledyne's outstanding shares to just over twenty million.”

“Companies that will sell one division and buy another because today this division generally sports a low multiple, and the one they're buying has a high multiple, and they think that may rub off on the whole company. That absolutely turns me off. The whole con…”

“Cooperman also noticed that Argonaut's investment portfolio contained only government securities, high grade municipals and corporates with zero junk bonds, a testament to Singleton's conservative investment philosophy that had transferred to the spun off comp…”

“Well, Cy, he replied, I figured most of these millions of expected potential computer customers would at first be intimidated by computers, but could anyone be intimidated by a computer named Apple? Besides, he said, all the others except Apple, if they failed…”

“Roberts noted that before the spinoff of Argonaut in 1986, Teledyne's stock price peaked at 367 dollars a share. By 1999, the combined value of all the companies was 691 dollars showing the lasting value Singleton had created.”

“Singleton is extremely intelligent. He tries to work out the best moves, and maybe he doesn't like to talk too much because when you're playing a game, you don't tell everyone else what your strategy is.”

“Subsidiary presidents had real authority, but they were measured on the Teledyne return, the average of the cash flow and reported profit, ensuring that they couldn't hide behind accounting tricks.”

“Charlie Munger said Henry Singleton was the smartest person that he ever met.”