Warren Buffett: price is now irrelevant

Prices for averagely decent firms have hit an all-time high, warns Warren Buffett.

Warren Buffett warns that "prices for decent, but far from spectacular" firms have "hit an all-time high". In his latest letter to shareholders in his investment vehicle Berkshire Hathaway, he notes that price now seems "almost irrelevant to an army of optimistic purchasers".

This "purchasing frenzy" is partly due to empire-building chief executives being egged on to carry out acquisitions by fee-hungry investment bankers. Exacerbating this natural tendency of ambitious executives is "the ample availability of extraordinarily cheap debt even a high-priced deal will usually boost per-share earnings if it is debt-financed".

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free
https://cdn.mos.cms.futurecdn.net/flexiimages/mw70aro6gl1676370748.jpg

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up
MoneyWeek

MoneyWeek is written by a team of experienced and award-winning journalists, plus expert columnists. As well as daily digital news and features, MoneyWeek also publishes a weekly magazine, covering investing and personal finance. From share tips, pensions, gold to practical investment tips - we provide a round-up to help you make money and keep it.