The Wall Street Journal: Annotating the Oracle of Omaha
Steven Kiel joined three dozen experts weighing in on Berkshire Hathaway's annual letter. Read the article here: Annotating the Oracle of Omaha.
On the right multiple for Berkshire:
The purchase price of a stock is the most important thing. Here, Buffett is saying that it is risky to purchase a stock near fair value or above, no matter whether it is Berkshire Hathaway or any other company. The higher the multiple paid, the higher the chance of not earning an acceptable return (or worse). Enjoy a company’s products. Respect their leadership. But don’t let an emotional attachment cause you to overpay for its stock.