Morningstar (NASDAQ:MORN) benefits from favorable industry dynamics, strong returns on capital, and wealthy (and liquid) customers. Further, the business is subscription driven and the demand for financial information is essentially perpetual -- although driven more or less by the bull and bear cycles of the market. The corporate stewards, too, use Buffett's language (10-K, p. 6): "Our strategy is to widen our economic moat." While not accepting the statement uncritically, the word choice is a sweet song to our ears. Warming our Buffett-loving hearts further, management writes: "our goal is to increase the intrinsic value of our business over time." Later, they also make a point to reference free cash flow. Swoon.
Morningstar, however, is pretty...
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