Buffett's letters consistently emphasize the importance of return on equity over earnings per share
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Buffett's annual letters consistently emphasize
Buffett's letters consistently emphasize the importance of return on equity over earnings per share
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A single share represents fractional ownership of a company
Earnings per share
Earnings per share (EPS) = Net income / Shares outstanding
Cyclically adjusted price-to-earnings ratio
Price-to-Earnings Ratio (P/E) measures market value relative to earnings
Market capitalization
Market capitalization = share price × shares outstanding
Anchoring effect
Anchoring bias skews sell decisions based on initial purchase price
Educational content, not financial advice.
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