Thomas Gayner
Profitable, modestly financed, and able to redeploy what it earns.
| Measure | Formula | Median | Middle half | Reporting it |
|---|---|---|---|---|
| Return on equity | Net income ÷ shareholders’ equity | 11.7% | 6.3% – 20.4% | 537 |
| Debt to equity | Total debt ÷ shareholders’ equity | 0.79x | 0.39x – 1.45x | 442 |
| Free cash flow | Operating cash flow − capital expenditure | $746.10m | $87.12m – $2.61bn | 526 |
Where each comes from
| Return on equity | The first criterion is a business earning good returns on capital without much leverage; this is the return half of that pair. |
|---|---|
| Debt to equity | And this is the leverage half. Stated together on purpose — a high return produced by borrowing is a different fact. |
| Free cash flow | Reinvestment at good rates is the third criterion, and it needs cash the business actually generates rather than earnings it reports. |
Source: Markel annual shareholder letters, which restate the four criteria every year.
What this cannot tell you
Two of his four are judgements: management with talent and integrity, and a fair price. Neither is in a filing.
This page describes a published method and applies its measures to filings. It is not a score, not a ranking and not a recommendation, and no page here aggregates these into a verdict. · All 11 metrics