8 Stocks Warren Buffett Should Never Buy

download 8 Stocks Warren Buffett Should Never Buy

of 19

  • date post

    17-Oct-2014
  • Category

    Business

  • view

    9.461
  • download

    0

Embed Size (px)

description

8 Stocks Warren Buffett Should Never Buy

Transcript of 8 Stocks Warren Buffett Should Never Buy

PowerPoint Presentation

8 Stocks Warren Buffett Should Never BuyApple (NASDAQ: AAPL)

Apple (NASDAQ: AAPL)While Apple has tons of cash and trades at a very attractive valuation, the ever-changing dynamics of the computing industry would likely scare Buffett awayWill people still be using iPhones in 20 years? Maybe, but maybe not. The same goes for the rest of Apples products!Tesla Motors (NASDAQ: TSLA)

Tesla Motors (NASDAQ: TSLA)Warren Buffett generally invests in companies that have a steady track record of profitability and trade for reasonably low valuations2013 was Teslas first profitable year, and shares trade for 116 times this years projected earnings. Amazon.com (NASDAQ: AMZN)

Amazon.com (NASDAQ: AMZN)Even though Amazons sales are nearly $75 billion per year, the company managed less than $300 million in earnings last year. Shares trade for more than 550 times TTM earnings, despite a very inconsistent history of profitabilityNetflix (NASDAQ: NFLX)

Netflix (NASDAQ: NFLX)Netflix operates in a very competitive segment, and it remains to be seen whether the companys business will be able to compete with other streaming servicesNetflix doesnt have a clear competitive advantage, which is an absolute must for a Buffett investmentAnnaly Capital Management (NASDAQ: NLY)

Annaly Capital Management (NYSE: NLY)Annaly and the other mortgage REITs are simply too highly levered for Buffetts tasteThe high leverage leaves the companies very sensitive to interest rate fluctuationsBuffett would be more likely to purchase shares of REITs that own actual propertiesFacebook (NASDAQ: FB)

Facebook (NASDAQ: FB)Buffett and his right-hand man Charlie Munger have publicly stated they would never invest in Facebook, but wouldnt bet against it eitherMunger has even gone so far as to say that he despises the very idea of Facebook, calling it counterproductiveChipotle Mexican Grill (NYSE: CMG)

Chipotle Mexican Grill (NYSE: CMG)Although Chipotle has been the growth rockstar of the fast-casual dining sector, the stock still trades at a very high P/E ratio and is far too volatile for Buffetts tasteThe restaurant business is just too difficult to sustain a high profit margin in after growth slowsBitcoin

BitcoinEven though its not a stock, Bitcoin definitely is one investment well never see Warren Buffett makeBuffett has called the Bitcoin infatuation a mirage, calling it no more revolutionary that writing a check or sending a money order

The Greatest Thing Warren Buffett Ever SaidPhoto CreditsApple Ipad Randolf JorbergTesla Roadster flickr/cytechAmazon.com flickr/torleyChipotle wikipedia/proshobBitcoin pixabay/Dry2