Why Warren buffet went all in on Apple #valueinvesting #fundamentalanalysis #warrenbuffett

Everyone talks about revenue and profit, but those numbers can be manipulated. So, the only metric that really matters is free cash flow. For example, WeWork was doing $1. 8 billion — in revenue, but they were also burning $2 billion in cash. And of course, — you know how that ended. Free cash flow is just cash from operations minus CapEx. It's the money left after running the business. On the other hand, for profits and net income, CFOs can play with depreciation, revenue recognition, and a whole bunch of other metrics all day. But cash is cash, so you either have it or you don't. Apple generates over $100 billion in free cash flow. At that time, Warren Buffett could have bought any other tech stock, but Apple was the one printing cash. So, of course, that's the one that he went all in on. When you screen for stocks, look at the free cash flow yield, which is free cash flow divided by the company's market cap. If you're looking at a number above 8%, you're getting paid. If you're looking at a number below 2%, you're overpaying for a story.