Many 'Wide Moat' Companies Losing Competitive Advantage
Every company is looking over its shoulder these days.
The number of firms with a "wide moat" that presents an almost insurmountable obstacle to potential competitors has been declining.
Rapid-fire innovation, technology and globalization mean challengers can arise from almost anywhere. A company can also have a wide moat in a business that isn't the money-maker it once was. Or a firm can become so enormous that it is difficult for it to significantly increase its profits.
Take personal computers, for example.
News events, such as the oil spill of BP or the government's civil suit against
"Competitive advantage these days is difficult to obtain and it is difficult for a business to have an indefinite wide moat," said
"Wide moat companies don't necessarily correlate to good investments, because if they did, why do they have to spend so much money on advertising?" asked
The combination of
"Companies are nipping at the heels of wide-moat companies such as
Despite plenty of competitors and the fact that cheaper versions of its products can be produced by others, Apple's brand image and products keep it well ahead of the pack. One challenge it faces, however, is that it is best known in the U.S. and not as popular in growing international markets.
Here are stocks of additional firms enjoying wide moats:
More recent arrivals on the corporate scene than such storied companies can also have a wide moat.
"It could be argued that the search engine
Available at Amazon.com:
- European Debt Crisis Affects Investments
- 7 Valuable Lessons For Investors
- The Reality of Mutual Fund Returns
- Mutual Funds and a Changing Landscape
- Assembling a Sturdy Retirement Portfolio
- Funds for Recent College Grads
- Many 'Wide Moat' Companies Losing Competitive Advantage
- Who Got Hit Worst in the Market Crash
- Utility Stocks: Trade Flash for Dependable Payouts
- Formulate Strategy Before Diving Into Higher Risk Mutual Funds
- Contrarian Investors Target Promising Out-of-Favor Stocks
- Income Investors Face Challenges as Economy Shifts
- Can SEC Beat Goldman Sachs?
- Business Schools' Great Ethics Debate
- Investing for Retirement A Balancing Act
- Fees Can Take Big Bite Out of Retirement Fund Contributions
- Small-Cap Stocks Poised For Big Comeback
- John C. Bogle's Old-fashioned Investing Advice Still Applies
- 10 Great Mutual Funds You've Never Heard of
- Mutual Funds Fees & Expenses Only One Factor
- Why Investors Are Flocking to Index Funds
- Trend Setting Companies Target Hip Young Consumers
- Weakening European Stocks Offer Some Bargains for U.S. Investors
- Investing: What to Do About Inflation and What Not to Do
- Kick-Start a Portfolio With Just a Little Cash
- Exchange Traded Funds Offer Low-Cost Diversification
- Fresh Look at Socially Responsible Mutual Funds
- Technology Opens Doors for Investors
- Make the Most of Your Mutual Fund Money
- Fiduciary Standard for Giving Investment Advice
- 'Investment Rewards' Credit Cards Well Worth A Look
Investing - Many 'Wide Moat' Companies Losing Competitive Advantage | Successful Investing
(c) 2010 Andrew Leckey