Tandy Leather Factory (NASDAQ:TLF) is a small company that has averaged returns on tangible equity in excess of 20% over the past 12 years because of its excellent economics. Revenues and margins have consistently grown year after year, and the company runs lean, returning any excess capital that cannot be reinvested at attractive rates back to the shareholders through either special dividends or intelligent share repurchases. Recent news also indicates that Tandy's best years are ahead of it.
A company with great economics and managers that work for the shareholder's best interest is a good investment for the long term, as long as you can enter at a good price. A company that historically earns 20% on tangible...
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