Cash flow absurdity and Warren Buffett’s Owner Earnings
Most analysts will talk of EBITDA, EBIT, NOPAT and what not. Warren Buffett’s approach is to think in terms of Owner Earnings. It is somewhat akin to free cash flow.
financial strength
How Mr. Market is grappling with intangibles
I think we have become leaders in the value investment industry for buying companies where intangibles have become their largest asset and you can’t see from a price to earnings or price to book how cheap the company is
Income Statements and Balance Sheets have largely lost their relevance for investors
The way things are, the only numbers of use to an investor from a Balance Sheet relate to debt. The expensing of investments in intangibles of lasting value creates a distortion that completely undermines the use of the Income Statement. Reported earnings are not only useless for investors but also misleading for the unwary.
Numbers, financial statements and things that can be counted but may not count
You know, Skippy, if all this bad stuff hadn’t happened, we would be having a pretty good quarter.
Financial strength – the debt equity ratio has serious shortcomings
No company under consideration will even be close to scrambling to pay its creditors.
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