warren buffett

Best business of Warren Buffett

The Best Business According to Warren Buffett

What is the best business according to Warren Buffett? A business that has the highest rate of return on tangible capital over time. This requires characteristics that will be discussed in this article. Finding such a business can greatly increase your investment returns over time.

How to value a stock using DCF

How to value a stock using a DCF

Determining the stock value is most accurate when using a DCF analysis. The method is rather simple, but the reasoning behind the assumptions is crucial to avoid investing mistakes. In this article we look at how to perform a DCF analysis and what factors to think about when valuing a stock.

EBITDA versus Free Cash Flow

EBITDA versus Free Cash Flow Examples

Previously we explained Warren Buffett’s Owner Earnings which focuses on the free cash flow. EBITDA can give a dangerous perspective of the financial health of a company. In this article we look at a couple of examples of businesses to see if they generate cash. Multiple sources are used to explain this crucial factor for correctly assessing the financial health of a company.

Owner earnings

Warren Buffett and Owner Earnings

Owner earnings is introduced by Warren Buffett in 1986. Owner earnings is the cash that is available for the shareholders after capital expenditures. Here we see why this is so important and that many great businesses focus on available cash.

Understanding Investment Risk

Understanding Investment Risk

Investment risk is commonly understood in terms of volatility in the world of Finance. This academic definition of investment risk is fundamentally different from the view of Warren Buffett on risk. This article discusses the differences in these viewpoints on investment risks and explains why it is essential to understand investment risk correctly.

How Warren Buffett Invests

How Warren Buffett Invests in stocks

Warren Buffett gave many insights about how he invests in stocks over the years. In the previous article we discussed the investing philosophy and investing principles of Warren Buffett. This article looks at how Warren Buffett invests in stocks by explaining his investment criteria for good businesses. Warren Buffett uses four criteria to determine if …

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How to invest in stocks - Investing principles of Warren Buffett

The Investing Principles of Warren Buffett

Understanding the fundamental investing principles of Warren Buffett will help you to better understand the investing process. This article will present the four principles that are recommended by Warren Buffett. Organizing your investment thoughts around these four principles will help in achieving satisfactory investment results. Furthermore, understanding these four fundamentals will help you to better control your emotions and develop the right investing philosophy.