Warren Buffett's approach to finding undervalued stocks with strong fundamentals
Purchase stocks trading below their true worth based on fundamental analysis
Always buy with a significant discount to protect against errors in analysis
Hold quality stocks for years, not months, to realize their true value
Focus on companies with solid earnings, low debt, and competitive advantages
Don't let short-term market fluctuations affect your investment decisions
Invest only in businesses you understand thoroughly
Look for stocks with P/E ratios lower than industry average or historical levels
Companies paying consistent dividends often indicate financial stability
Price-to-book ratio below 1 may indicate undervaluation relative to assets
Positive and growing free cash flow demonstrates business quality
Look for sustainable competitive advantages like brand, patents, or network effects
Stock price drop due to fixable issues, not fundamental business problems
Berkshire Hathaway CEO, known for buying quality businesses at fair prices
Father of value investing and author of "The Intelligent Investor"
Berkshire Hathaway Vice Chairman and Buffett's long-time partner
India's Warren Buffett, known for long-term value picks like Titan and CRISIL
Compare stock price to earnings per share; lower is often better for value stocks
Stock price relative to book value; useful for asset-heavy businesses
Revenue-based valuation; helpful when earnings are volatile or negative
Lower ratios indicate less financial risk and better balance sheet strength
Measures profitability; value investors seek high ROE with sustainable growth
FCF divided by market cap; higher yields suggest undervaluation
Value investing requires patience; market may take years to recognize true value
Hold 15-20 stocks across sectors to reduce concentration risk
Study company financials, management commentary, and business risks thoroughly
Some cheap stocks are cheap for good reasons; distinguish value from declining businesses
Warren Buffett: "It's far better to buy a wonderful company at a fair price"
Review holdings quarterly but avoid overreacting to short-term price movements