Johnson Controls: CEO Interview Makes Me Proud To Be a Shareholder

Warren Buffett and Larry Smith-like wisdom resonates from an interview with Johnson Control’s (NYSE: JCI) Stephen Roell. It made me glad to be a shareholder. It made me proud to be an investor. You should read it.

I like his rate of growth projections and how he “takes a pass” if they don’t see at least 15%-16%.

Warren Buffett never paid a dividend because he believed he could invest more wisely than any of his shareholders. That’s essentially what Roell says, in a different way. That is, the same logic holds true for share buy-backs. A company should only do this if it does not have any sound investments to pursue.

Roell is pursuing rather than leveraging shareholders at increasing rates. That said, JCI does pay a small dividend, and I think there is a small buy-back plan in place.

Larry Smith is a highly respected, highly informed, highly driven, economics professor at the University of Waterloo. Specifically, Smith’s wisdom applies to Roell’s answer of the second question. It’s difficult and lengthy to put into words, but simply, I like leaders who exhibit “a little contrarian” style.

Disclosure: Long JCI