Warren Buffett Historical Growth is a quality investing strategy inspired by an interpretation of Warren Buffett's investment approach by Mary Buffett and David Clark in their book, The New Buffettology. It is a strategy that combines Buffett's focus on value and business quality. To work out whether the stock is reasonably valued, the strategy uses historical earnings growth; the higher that growth rate is, the more likely it is that the company has a durable competitive advantage. The strategy also looks for low debt and a high earnings yield, return on equity and return on capital employed. In The New Buffettology, Mary Buffett and David Clark explain: "Historical per share earnings that are both strong and show an upward trend indicate a durable competitive advantage." Remember, Buffett is famous for looking beyond financial measures when examining the quality of a business franchise.
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The world's most famous living investor, chairman and CEO of Berkshire Hathaway
The New Buffettology
by Mary Buffett, David Clark
The original book, "Buffettology: The Previously Unexplained Techniques That Have Made Warren Buffett the World's Most Famous Investor", was published in 1997 - a more recent edition, "The New Buffetology" was released in 2002. We are not aware of any backtesting for this screen.
This screen uses the following criteria:
Results are sorted by:
And limited to the first 200 Results
| Returns |  |
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FTSE 100 |
|---|---|---|---|---|---|---|---|---|
| 1 week | -0.7% | -1.3% | -1.2% | -2.4% | -2.1% | -2.1% | 0.5% | 0.6% |
| 1 month | -2.4% | -3.3% | 1.7% | -4.4% | -1.8% | -2.4% | 2.7% | -2.5% |
| 3 months | 3.2% | -1.9% | 6.0% | -11.2% | 4.0% | -3.2% | 2.4% | 10.5% |
| 6 months | -2.2% | -6.0% | -3.0% | -21.5% | -1.4% | 5.2% | -1.2% | 1.2% |
| 1 year | 6.2% | -7.1% | 4.2% | -9.6% | 11.2% | 5.3% | 2.9% | 3.3% |
| 2 years | -3.7% | 16.5% | 34.7% | 25.1% | 48.0% | 49.5% | 20.4% | 22.7% |
| Annualised | 3.6% | 6.2% | 11.7% | 8.4% | 16.2% | 22.1% | 12.3% | |
| Risks | ||||||||
| Max Drawdown | -30.7% | -16.3% | -27.1% | -29.7% | -12.7% | -12.2% | -20.6% | |
| Avg Holdings | 14.9 | 24 | 24.9 | 16.7 | 4.9 | 25 | 6.9 | |
| Diversification | Moderate | Good | Good | Good | Low | Good | Low | |
Studies based on equal weighted portfolios of max 25 stocks rebalanced quarterly. Qualifying shares below updated daily. Past performance not indicative of future returns.
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Ticker | Name | Mkt Cap £m | EPS Gwth Streak | ROE % 5y Avg | ROCE % 5y Avg | FCF | Long Term Debt | Net Profit before Extraords | Price 5y CAGR % | NAV PS 5y CAGR % | Earnings Yield % Last Yr | Exp. Return (Hist Gwth) | Flag |
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