"The following four broad tenets and associated questions/ advice's are suggested by legendary investor Warren Buffet. · Business Tenets: – Is the business simple and understandable? – Does the business have a consistent operating history? – Does the business have favorable long-term prospects? · Management Tenets: – Is management rational? – Is management candid with its shareholders? · Financial Tenets: – Focus on return on equity, not earnings per share – Calculate “owner earnings” – Look for companies with high profit margins – For every dollar retained, make sure the company has created at least one dollar of market value · Market Tenets: – What is the intrinsic value of the business? – Can the business be purchased at a significant discount to its fundamental intrinsic value? Source: http://in.docsity.com/en-docs/Company_Analysis_-_Security_Analysis_and_Portfolio_Management_-_Solved_Quiz_"
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