Wb Presentation

1,108 views
1,041 views

Published on

Published in: Economy & Finance, Business
1 Comment
0 Likes
Statistics
Notes
  • Be the first to like this

No Downloads
Views
Total views
1,108
On SlideShare
0
From Embeds
0
Number of Embeds
21
Actions
Shares
0
Downloads
25
Comments
1
Likes
0
Embeds 0
No embeds

No notes for slide

Wb Presentation

  1. 1. Warren E. Buffet (second richest man in the world)
  2. 2. Warren E. Buffett <ul><li>Born : August 30, 1930 Omaha, Nebraska </li></ul><ul><li>Occupation: CEO, Berkshire Hathaway </li></ul><ul><li>Salary : 100,000 USD (2005) </li></ul><ul><li>Net worth : US$50 billion </li></ul>
  3. 3. <ul><li>Began his career at the age of 11 </li></ul><ul><li>he purchased three shares of Cities Service (Preferred ) </li></ul><ul><li>first lesson he learnt that became his legendary investment strategy - which is essentially - patience pays, so buy them and hold them. </li></ul><ul><li>He figured out two other critical things about himself </li></ul><ul><li>- what he is good at and </li></ul><ul><li>- what he likes to do. </li></ul>
  4. 4. <ul><li>1956 – formed the limited partnership </li></ul><ul><li>In nine years, Buffett turned a $105,000 into $26 million - a stunning 24,000 per cent increase </li></ul><ul><li>Initial investments - in textile companies, farm equipment manufacturers. </li></ul><ul><li>1962 – purchased Berkshire Hathaway, a textile manufacturing firm </li></ul><ul><li>Berkshire Hathaway eventually turned to a Holding Company </li></ul>
  5. 5. Acquisitions of Berkshire <ul><li>1964 - National Indemnity. </li></ul><ul><li>1972 - Candies for $25 million </li></ul><ul><li>1983 - Nebraska Furniture Mart </li></ul><ul><li>1989 – Borhseim </li></ul><ul><li>1998 - Dairy Queen, Geico (Largest Operation), Net Jets and General Re Corp. </li></ul><ul><li>2002 - Fruit of the Loom </li></ul>
  6. 6. Investments <ul><li>American Express </li></ul><ul><li>M&T Bank </li></ul><ul><li>The Coca-Cola Company </li></ul><ul><li>The Washington Post Company </li></ul><ul><li>Procter & Gamble </li></ul><ul><li>PetroChina </li></ul><ul><li>ISCAR </li></ul>
  7. 7. Management style <ul><li>views himself as a capital allocator </li></ul><ul><li>When Buffett acquires a controlling interest in a business, he makes clear to the owner the following: </li></ul><ul><ul><li>not interfere with the running of the company. </li></ul></ul><ul><ul><li>responsible for hiring and setting the compensation of the top executive. </li></ul></ul><ul><ul><li>Capital allocated to the business will have a price tag attached. </li></ul></ul>
  8. 8. Investment approach <ul><li>modification of the value investing approach of his mentor Benjamin Graham . </li></ul>
  9. 9. Basic questions to ask <ul><li>1. Does the company sell brand name products that are likely to endure? </li></ul><ul><li>2. Is the business of the company easily understood ? </li></ul><ul><li>3. Does the company invest in and operate businesses within its area of expertise ? </li></ul><ul><li>4. Does the company have the ability to maintain or increase profitability by raising prices? </li></ul><ul><li>5. Is the company, looking at both long-term debt , and the current position, conservatively financed? </li></ul><ul><li>6. Does the company show consistently high returns on equity and capital? </li></ul><ul><li>7. Have the earnings per share and sales per share of the company shown consistent growth above market averages over a period of at least five years? </li></ul><ul><li>8. Hs the company been buying back its shares , and if so, has it bought them responsibly </li></ul><ul><li>9. Has management wisely used retained earnings to increase the rate of return to shareholders? </li></ul><ul><li>10.Is the company likely to require large capital sums to ensure continuing profitability? </li></ul>
  10. 10. <ul><li>Brand Names </li></ul><ul><li>Understanding the company </li></ul><ul><li>Sticking to what you know </li></ul><ul><li>Company Growth </li></ul><ul><li>Sound management </li></ul>
  11. 11. <ul><li>&quot;I look for something that I can understand to start with, there are all kinds of businesses I don't understand.“ </li></ul><ul><li>conservative when speculation is rampant in the market and being aggressive when others are fearing for their capital </li></ul><ul><li>coined the term &quot;economic moat,&quot; preferring to acquire companies that possess sustainable competitive advantages over their competitors </li></ul>

×