What does
Warren Buffett's
message to stockholders mean for you and your money?
Every
year Mr. Buffett, the world's third-richest man and arguably the most
successful stock-market investor in history, writes a letter to
stockholders in his investment company
Berkshire Hathaway.
BRKB -0.38%
The latest
came out this weekend. There are usually some nuggets for all those who
haven't invested in Berkshire, and this year's letter was no exception.
Here are five:
Warren Buffett, chairman and chief executive officer of
Berkshire Hathaway, before being presented the Presidential Medal of
Freedom at the White House in February.
Bloomberg News
1. Watch out for stock-market valuations.
Mr.
Buffett's company is now sitting on a cash hoard of $38 billion.
"That's among the highest levels it's ever been," says Stifel Nicolas
analyst
Meyer Shields.
While Mr. Buffett says he is looking for a big acquisition, and
has his "elephant gun loaded," the high cash pile also suggests he's
having a challenge finding really good deals. If Mr. Buffett is
cautious, investors might want to take note: It's another sign that many
valuations on the stock market may be looking a little stretched.