Warren Buffett And The Interpretation Of Financ... Today

: He looks for low overhead. Ideally, SG&A (Selling, General, and Administrative) expenses should be 30% or less of gross profit.

: A key indicator of a moat. Buffett prefers companies with a gross margin of 40% or higher . High margins suggest the company isn't forced to compete on price alone. Warren Buffett and the Interpretation of Financ...

: High R&D can be a red flag. If a company must constantly spend to reinvent itself just to stay relevant, its competitive advantage may not be durable. : He looks for low overhead

: Great businesses generate enough cash that they shouldn't need heavy debt. Buffett looks for interest expenses that are less than 15% of operating income. The Balance Sheet: Testing for Durability Buffett prefers companies with a gross margin of

Warren Buffett and the Interpretation of Financial Statements: The Search for the Company with a Durable Competitive Advantage

While the income statement shows performance, the balance sheet reveals the company's structural health and staying power. Go to product viewer dialog for this item.