So often, my messages to readers can be summed up in one word – patience.
Usually, I’m talking about the power of compounding and the importance of taking a long-term view with your investments.
I’m a huge proponent for dividend growth stocks. I’ve seen the amazing power of a dividend snowball forming firsthand.
I’m basing my own retirement plans around the passive income that my investment portfolio provides. And if you’re a reader of Wide Moat Research, I assume you are as well.
Anybody who consistently lives below their means, regularly invests their savings into high-quality, dividend growth stocks, and reinvests their dividends can – and will – reach financial freedom.
It’s not always easy. But it is that simple. And it requires (you guessed it) patience.
Compound interest is a wonder, but only if you let it be…
Do Nothing
Terry Smith is the CEO of Fundsmith. He also manages one of my favorite “superinvestor” portfolios. Terry is famous for his mantra: Buy good companies. Don’t overpay. Do nothing.
That’s beautiful.
Buy good companies. Don’t overpay. Then, do nothing.
Warren Buffett has a similar sentiment: “The stock market is designed to transfer money from the impatient to the patient.”
He’s largely talking about active traders here… especially those trying to time the broad market from a macro perspective.
In my humble opinion – that’s impossible to do consistently.
Buffett’s longtime partner, Charlie Munger, always had a way with words. He put it another way: “The world is full of foolish gamblers and they will not do as well as the patient investors.”
One more quote…
Howard Marks, who is one of both Brad and my favorite investors, has simply stated, “Patience is essential.”
Marks has also said, “When there’s nothing particularly clever to do, the potential pitfall lies in insisting on being clever.”
I fall prey to this myself.
Don’t Try to Be Too Clever
I’d like to think I’m a pretty clever guy, that I’m smarter than the average bear, as Yogi would say.
I’m always on the hunt for the next bargain that the market is mispricing. And don’t get me wrong – the market does misprice great companies all the time. We recommend a lot of them in the pages of The Wide Moat Letter.
But sometimes, that mindset can lead you down a path of ruin. Sometimes, there simply aren’t great companies trading for great prices. The market isn’t always efficient. But it usually is.
Sometimes, the right thing to do is to simply sit tight, squirrel away cash, and wait for the next attractive opportunity.
That can be a tough pill to swallow.
There’s always the temptation to “do something.” But sometimes, doing nothing is doing something.
The dividend snowball doesn’t require action from its owner to grow larger. With every dividend increase and every reinvested dividend, it’s getting bigger (organically).
If you have the patience for that, then you’re making money – and building wealth – while you sleep.
James Rogers, who is most famous for co-founding the Quantum Fund, which beat the market by thousands of percent during the 1970s, also expressed this sentiment articulately.
He said, “One of the best rules anybody can learn about investing is to do nothing, absolutely nothing, unless there is something to do.”
Regarding that “something to do,” Rogers said, “I just wait until there is money lying in the corner, and all I have to do is go over there and pick it up.”
With all of this in mind, I want to provide an example of a company that I’d absolutely love to recommend, but just can’t at today’s valuation.
Make a Watch List While You Wait
Casey’s General Stores (CASY) is on a roll this year. The stock’s up by nearly 40% on a year-to-date basis. And I guess this shouldn’t be surprising, considering CASY shares are up by more than 200% during the past five years and by more than 400% during the past decade.
This convenience store/gas station operator has been a compounding machine throughout its history. Casey’s has posted double-digit earnings-per-share (“EPS”) growth during 13 out of the last 20 years.
In its most recent quarter, Casey’s posted 19% EPS growth and signaled continued double-digit profit gains as it plans to aggressively add to its store count (the company has built/acquired nearly 1,200 units during the past 10 years and hopes to add roughly 250 stores a year moving forward. What’s more, with scale, the company believes it can continue to grow its margins.
Source: CASY Investor Deck, September 2025
What’s not to like about a stock that is rapidly growing its revenues while expanding margins? Those are the best stories when it comes to earnings growth.
And in Casey’s case, those growing profits translate directly toward a growing dividend.
The company recently became a dividend aristocrat, having increased its dividend for 25 consecutive years.
Over the past 20 years, the S&P 500’s dividend compound annual growth rate is roughly 6%. Casey’s General Stores boasts a 13.4% dividend growth rate over this same period, showing that this rather boring, Midwestern retailer can produce exciting returns.
Source: CASY Investor Deck, September 2025
This is the exact type of stock that I would love to see recommended in The Wide Moat Letter. The problem is, CASY shares are trading for 35 times earnings right now. That’s well above the company’s five-, 10-, and 20-year average price-to-earnings ratios of 23.4 times, 23.1 times, and 20.4 times, respectively.
Like so many other blue chips that are trading with high premiums right now, I know that chasing Casey’s with an all-time high valuation attached to shares is not a prudent decision.
Instead, as hard as it is, we’ll wait.
Casey’s isn’t the only stock that’s on my watch list at the moment.
After the market’s recent rally, I’m having a really hard time spotting great values in the market. And that’s also made it more difficult to find compelling values for our subscribers.
But that’s OK.
During times like these, when we’re sitting on our hands, that snowball continues to grow.
Hopefully sometime soon a wonderful company like Casey’s General Stores will go on sale. And when it does, I hope we’ll have the chance to recommend it to Wide Moat Letter subscribers.
But until then, my recommendation is to sit still, build cash, and don’t get too clever.
In other words… just do nothing if you can’t find a bargain that you absolutely love.
Regards,
Nick Ward
Analyst, Wide Moat Research
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