John Price says he's figured out
how to sell Warren Buffett in a box. Make that in a software
package, to be precise. Price is a mathematics and finance
scholar who a dozen years ago decided to make a study of
Buffett, the Omaha billionaire whose annual letter to shareholders
of Berkshire Hathaway (BRK-A, BRK-B) serves as a Talmud
Price has reduced what he's learned about
Buffett's philosophy and actions into binaries and entered
them into a program he is selling for an annual subscription
of $997. He calls it Conscious Investor (Curious Investor
having been taken, I suppose) and claims that following
the principles therein have helped him beat the market easily
since June 1997.
The software contains 10 years of data on
6,000 U.S. stocks and screens them according to Buffett's
purported priorities. The subscription updates the data.
And what does the virtual Buffett advise? "Look consistently
at high return on equity and return on capital. That's where
the managers are consistently delivering for shareholders,''
Price said. The other rule: Invest only in businesses that
Among the companies passing the program's
stock screener lately are Bed Bath & Beyond (BBBY) and
Walgreen (WAG). BBBY "is growing 25 percent a year''
and WAG "is building hundreds of stores. Their sales
growth is more than same-store sales,'' Price said. Buffett
has no known stake in either company.
Buffett doesn't endorse the software, nor has he complained
about it, Price said.
Ultimately, he looks at Buffett's approach
as labor-saving. Price said it shows the advantages of long-term
investing, a style in which "it's the company that's
doing all the work creating shareholder value. With short-term
trading, you're doing all the work.''
John Price is CEO of Conscious Investing. Email: firstname.lastname@example.org