More on Buffett as not a value investor:
Of course every investor who buys a stock thinks he/she is getting a good value for his/her money. But if we categorize purchases by growth vs. value, then Buffett neither buys popular growth stocks nor deeply-discounted Ben Graham stuff.
IMO, Mr. Buffett is not a value investor because - in contrast to Ben Graham--
1) Buffett does not buy (from what I can see) undervalued and sell at full value.
(KO, G, AXP, WXP, DIS, FNM, MCD --- all high pe and high p/bv IMO)
2) Emphasizes income statement over balance sheet.
"Your goal as an investor should simply be to purchase, at a rational price, a part interest in an easily understandable business whose earnings are virtually certain to be materially higher five, ten, and 20 years from now." Buffett quote. This is not classic value investing! Even if it does work out fabulously well.
Paul Senior |
