ValueInvesting

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Miscellaneous thoughts of a Warren Buffett minded value investor


Warren Buffett’s long-time business partner Charlie Munger compares in his excellent book,Poor Charlie’s Almanack, success in the race track to success in the stock market:

The model I like - to sort of simplify the notion of what goes on in a market for common stocks - is the pari-mutuel system at the race track. If [...]

Posted on 22:34, April 5, 2009

Let me start this blog with a little quiz:

In the following table you have two companies that are both growing at constant rate of 5% per year. These are very Buffett style companies: stable and debt free. Everything else equal, in which one would you invest?

 

Widget Inc.

Gadget Inc.

P/E-ratio (price per earnings)

10

10

P/B-ratio (price per book value)

5

0.5

Growth

5%

5%

If [...]

Posted on 02:28, March 28, 2009
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