Warren Buffett: Quantitative vs Qualitative Investing

In Buffett Partnership Letter October 9, 1967, Buffett said, “The evaluation of securities and businesses for investment purposes has always involved a mixture of qualitative and quantitative factors. At the one extreme, the analyst exclusively oriented to qualitative factors would say, “Buy the right company (with the right prospects, inherent industry conditions, management, etc..) and […]

What is Economic Franchise

Economic franchise is one of the most important investing concepts used by Warren Buffett. Companies with economic franchise are rare in the business world. They are great businesses which enjoy pricing power and could stand incapable management. In his 1991 letter to Berkshire Hathaway shareholders, Warren Buffett explained the concept of economic franchise: “An economic […]

Warren Buffett on Stock Repurchase

One usage of retained earnings we often greet with special enthusiasm when practiced by companies in which we have an investment interest is repurchase of their own shares. The reasoning is simple: if a fine business is selling in the marketplace for far less than intrinsic value, what more certain or more profitable utilization of […]

Buffett: Content vs Distribution

BECKY: You have bought more IBM shares though, right? BUFFETT: Yeah, we bought a few, yeah. JOE: I was just getting back to this media, ’cause I’m trying to understand, I don’t know what the landscape looks like. And Warren probably— doesn’t necessarily.Does it look like the pipes, Warren, eventually become more commoditized, you know, […]

Why Warren Buffett Bought IBM

BECKY: Wait. Wait a second, IBM is a tech company, and you don’t buy tech companies. Why have you been buying IBM? BUFFETT: Well, I didn’t buy railroad companies for a long time either. I—it’s interesting. I have probably—I’ve had two interesting incidents in my life connected with IBM, but I’ve probably read the annual […]

On Subprime Mortgage Industry

– There are similarities between subprime and manufactured housing financing – The most important factor for the subprime industry is the health of the economy, which has been good of late – Securitization moves the ultimate lender farther away from borrower, which is what causes problems – A shock will probably not occur unless we […]