| | | I would say that Buffett moved away from Graham's investment strategy after spending his early, post graduation years in Graham's employ where he spent many hours paging through Barron's, among other things, for companies whose stock price was below their book values.
He came to the conclusion that, in such instances, these companies were not always "investment bargains" as their stock prices did not always move back up above those book values, often for good reason.
According to interrogations and research of Graham's methods by David Clark/Mary Buffett, they concluded that Graham never made the distinction between a company that held a long-term competitive advantage over its competitors and one that didn't. He was only interested in whether or not the company had sufficient earning power to get it out of the economic trouble that had sent its stock price spiralling downward.
Buffett learned to seek out companies that had Durable Competitive Advantage, i.e. long term competitive advantage over their competitors, with financial criteria that supported that status .... and he made BILLIONS using that strategy ... FAR MORE than Graham would ever had made using his, IMO. |
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