Over the long run, the primary driver of a stock's market value appreciation is the growth in its underlying intrinsic value, specifically its earnings per share (EPS). This simple but profound concept grounds investing in business fundamentals, treating stocks as ownership stakes rather than speculative tickers.

Dividends do not inherently increase an investor's capital, as a dividend payment reduces the stock's price by the same amount. Total shareholder return is only achieved if the dividend is fully reinvested without taxes or fees; otherwise, only price appreciation grows the initial investment.

Speculation isn't inherently negative; it's the financial engine of innovation. It represents putting capital at risk for uncertain future gains, which is fundamental to groundbreaking ventures like Tesla. The challenge is encouraging productive speculation without letting it get out of control.

Companies termed "share cannibals" aggressively repurchase their own shares, especially when undervalued. This capital allocation strategy is often superior to dividends because it transfers value from sellers to long-term shareholders and acts as a high-return, low-risk investment in the company's own business.

While passive market investing is wise, the highest potential returns often come from actively investing capital back into your own business. It is the one asset over which an entrepreneur has the most control and which offers the greatest potential for asymmetrical upside.

Financial models struggle to project sustained high growth rates (>30% YoY). Analysts naturally revert to the mean, causing them to undervalue companies that defy this and maintain high growth for years, creating an opportunity for investors who spot this persistence.

Instead of taking profit and paying taxes, a business can reinvest that capital into a growth driver, like hiring. This investment reduces taxable income while dramatically increasing the company's profit potential, leading to a much larger, tax-efficient gain in enterprise value.

When a company's stock trades at a significant discount to tangible assets, the market signals that every new dollar invested is immediately devalued. The correct capital allocation is returning capital to shareholders via buybacks or dividends, not pursuing growth projects that the market refuses to credit.

According to the Kalecki-Levy equation, gross investment spending immediately becomes revenue for another company. Unlike consumption-driven revenue which has immediate wage costs, the cost of investment (depreciation) is recognized slowly over time, creating a powerful, immediate boost to aggregate corporate profits.