Warren Buffett talks about investing in stocks with high Price to earnings (P/E) ratios. Buffett is the CEO of Berkshire Hathaway and is considered by many to be the greatest investor of all time. This question is from the 1998 Berkshire Hathaway Annual Meeting.
Subscribe to The Investor Center for content focused on investing, stocks, entrepreneurship, and passive income. Interviews feature the best business minds in the world including Warren Buffett, Charlie Munger, Howard Marks, Peter Lynch, and Ray Dalio. https://www.youtube.com/channel/UC2cL3pI1H3tiozKif6A8fmA
Warren Buffett Reading List:
The Intelligent Investor – https://amzn.to/31603ld
The Warren Buffett Way – https://amzn.to/3esAApY
Common Stocks and Uncommon Profits – https://amzn.to/3hPtZb2
The Outsiders – https://amzn.to/315rZFJ
Business Adventures – https://amzn.to/2BwKKqI
Where are the Customers’ Yachts? – https://amzn.to/3fNNWxg
The Little Book of Common Sense Investing – https://amzn.to/2YXQban
(The above are affiliate links that help support the channel at absolutely zero cost to you.)
OTHER VIDEOS YOU MAY LIKE:
▪️Charlie Munger: Avoid These Mistakes to Double Your Net Worth: https://www.youtube.com/watch?v=omqdy4_5iXw
▪️Howard Marks on Investing in a Low Interest Rate Environment: https://www.youtube.com/watch?v=MRpgOfSL4TU
▪️Charlie Munger: 100 Years of Wisdom Summed Up in 20 Minutes: https://www.youtube.com/watch?v=S15XpqbUFFA&list=UU2cL3pI1H3tiozKif6A8fmA&index=19
source
30 Comments
Charlie didn't speak very often, but when he did it was always brilliant!
Charlie broke it down effortlessly 2:40 sometimes the answer is so simple it’s not believable. My dad always said life is simple, it’s not easy but it’s simple.
Okay should you invest or not wtf spent minutes with direct answer.
I see P/E as a bet how high am I willing to bet on the future of a company
The guy who understands intinsic value, but doesn't understand tesla, yet invest in byd.
So he said, "No"
I look for prospective pending acquisitions and/or talk of foreign partnerships/expansion for a fair share price or ipo
PE ratio goes up with price increase, but even more with Earnings decrease. I prefer to watch price and earnings separately.
The collapse of Margin debt leads to a decrease in stock prices and trigger a wave of selling as investors try to cover their losses, Buying a stock is easy, but buying the right stock without a time-tested strategy is incredibly hard. Hence what are the best stocks to buy now or put on a watchlist? I’ve been trying to grow my portfolio of $145K for sometime now, my major challenge is not knowing the best entry and exit strategies … I would greatly appreciate any suggestions
Is i invest in 50 pe ratio
RUSSIA🇷🇺 MKT CAP TO GDP -23% UNDERVALUED BUFFETT INDICATOR /200% USA 🇺🇸INDIA🇮🇳 POPULAR
RUSSIAN🇷🇺COMPANIES PE RaTIO BELOW 5 /2- RTS 140000 MEANING COMPANIES EARN 50 LAKH INR EVERY YEAR ON 1 CR MKT CAP 🧢🎩- UNDERVALUED INVESTOR IS REALIST WHO BUY FROM PESSIMIST SELL TO OPTIMIST BUY STOCKS CRYPTO FOR LONG TERM CONNECTIVITY NOT GROWTH – BUY PUT CALL STOCKS CRYPTO FUTURES FOR SHORT TERM UNCERTAINTY (2) USA -30/ INDIA🇮🇳-30 OVERVALUED
@Investor center: Why do investors think PE is important when it has got zero correlation with your outcome. For example, American Express trades a multiple of 15 with trailing 5year return of 48%. Whereas Mastercard, trades at a multiple of 37 with trailing 5year return of 126%. At the end of the day, my 100 dollars in American Express becomes 148 and the same becomes 226 with Mastercard. So who cares if I overpaid or got less ownership of the company. Correct me if I am wrong. What am I missing here?
10.000 ?
BUFFED AND CHARLIE BOUGHT AMAZON AT P/E 78 LOL
Well the challenge is to buy low p/e that become high p/e in short to medium term.
The challenge with the simple dive is you don't dive in shallow waters and hit your head on the floor.
charlie counting train cars
Don''t i wanna invest in stocks with low Price to earning ratio? The more money is earned on every dollar invested the better i.e. low p/e… no?
Remember, guys: a good company is not always a good investment, it depends on the price you pay for it.
Confirmed: Charlie sips his coke about once a minute.
I like it! You get paid just as well the simple dive as long as you execute it well! Don't make it so complicated, keep it simple and go for the high probability of return
P/E is relative and just another metric to compare and get a quick idea. But if it's because of real growth, it's acceptable while it's not very high. If it's just hype, then you are taking too much risk.
Classic Charlie 😁
Sorry I’m not sure I get the message right, does this imply why searching for a high P/E stock when a low PE ratio stock has same earnings prospects as high PE stocks?
Warren the goat. This is really good to know as Tesla's P/E so high.
I loved the fact how Charlie's interestingly very uninterested in what buffet has to say 😂😂
well said from the one and only
Thank you for this excellent video👍
Buffett the legend ❤️