Comments on: Warren Buffett Value Formula separates weak industries from strong ones.

By: jhalas20

jhalas20 — Sat, 25 Jul 2009 12:20:10 +0000

Alan, I like your …
Alan, I like your screen here. You’re right. It’s great for its simplicity. This screen will keep you from ever losing too much.

By: MrAlanKendall

MrAlanKendall — Sat, 25 Jul 2009 12:20:10 +0000

Yes, this formula …
Yes, this formula is not exact, but it does filter out 99% of the companies that are overpriced or do not have a good enough return. It forces me to focus on the 1% of companies that are making a good profit and are low priced. I used to have a different formula but after using it for 2 years, adopted this one for its simplicity.

By: tubebuffett

tubebuffett — Sat, 25 Jul 2009 12:20:10 +0000

Dude, you forgot …
Dude, you forgot the EPS and return on equity part. Warren buys companies by predicting the
EPS growth in ten years for an average P/e and not by book value. He has a calculation for intrinsic value based on EPS that is totally independant of book value.