Quantitative Analysis

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The price you pay will determine your rate of return.  This is a key idea for Warren.  Management’s ability to grow per share earnings of a company is key to growth of the shareholder’s value in the company.  The increase in per share earnings will, over a period of time, increase the market valuation for the company’s stock.

Three Tests to Determine the Rate of Return

Warren performs three tests in order to determine if the company he invests in will yield him a desirable rate of return.

The price you pay will determine your rate of return.  This is a key idea for Warren.  Management’s ability to grow per share earnings of a company is key to growth of the shareholder’s value in the company.  The increase in per share earnings will, over a period of time, increase the market valuation for the company’s stock.

Three Tests to Determine the Rate of Return

Warren performs three tests in order to determine if the company he invests in will yield him a desirable rate of return.