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Strategies & Market Trends : Buffettology

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To: cfimx who wrote (513)10/26/1998 4:49:00 PM
From: Axel Gunderson  Read Replies (1) of 4690
 
Oops! I'm eating worms on this one. Sorry, Twister. You are right - it was I that was reading the question wrong.

Still I don't think stock market response is a good way to value the company's business performance. Your post in fact gives the reason for this - there is a difference between voting and weighing.

Back in post 457 I offered another method for evaluating business performance, which gets back to the original problem:

If somebody really wants to quantify business performance, it makes more sense to take year to year growth in free cash flow over the previous years free cash flow so that one can see how they are vesting resources currently.

Axel
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