Google: Now The Perfect Stock For Buffett
By Valuable Insights:
Google (GOOG), one of the premier growth stories of our generation, has been transformed into a value stock (at roughly 12x 2012 EPS ex-cash )- in fact, it's become so cheap, and underappreciated, that it's become the perfect stock for Warren Buffett and Berkshire Hathaway (BRK.A), and we believe it's increasingly likely that Berkshire will soon become a major shareholder. Google meets the following key Buffett criteria:
- Dominant brand with incredible global brand equity.
- Deep, wide and growing moat around core business.
- Management/owners focused on long-term value creation rather than short -term goals.
- Mr. Market is selling shares at a significant discount to intrinsic value due to an incorrect/myopic analysis of underlying earnings power.
In addition, Google is large and liquid enough for it to be worth Buffett's time and effort - a large position could actually be impactful to the Berkshire portfolio. Following Berkshire's recent purchase of IBM (IBM)Complete Story »
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