QVI Stock Picks Review | Winter 2024 | #4

Quality Value Investing's financials sector updates on BRK.B and V

Summary:

• In this updated coverage, Quality Value Investing (QVI) reviews its financials sector stock picks, Berkshire Hathaway and Visa.

• The post includes updates to QVI’s checklist research and analysis of each company’s current wealth and the stock price’s present value.

• Any changes in my view (buy, hold, or sell) are reflected in the QVI Concentrated and Expanded Stock Picks Real-Time Performance Trackers.

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Uncovering the winning stocks of enduring enterprises

When referencing this report, premium (paying) subscribers can access their Quality Value Investing (QVI) Glossary of Investing Terms and Metric Targets. Unless noted, all data presented is sourced from Seeking Alpha Premium as of the market close on February 6, 2024, and intended for illustration only.

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In this series, Quality Value Investing reviews the QVI Real-Time Stock Picks by sector to update each holding’s performance, current wealth, and present value.

Today’s post covers QVI’s financials sector picks: Berkshire Hathaway, Inc. (NYSE: BRK.B) and Visa, Inc. (NYSE: V).

Company Current Wealth

To uncover the current wealth of each company, QVI defines the value proposition, measures returns on management, and assesses enterprise downside risks.

Value Proposition

QVI’s value proposition section defines the competitive advantages of a company’s products or services to its customers compared to the industry, including the stock’s historical performance vs. the sector and market.

Value Proposition Elevator Pitches

Berkshire Hathaway is the Warren Buffett-built conglomerate of diversified businesses wholly owned or through its massive stock portfolio, and, thus, better than an index fund because of its emphasis on quality and value.

Visa is a household name in global electronic payment processing, where half its revenues drop to the bottom line. Now, that's a dynamic business model, if not highway robbery.

Performance vs. Sector and Market

The chart below illustrates each pick’s performance against the Financials Select Sector SPDR® Fund ETF (NYSE: XLF) -1.79% and the SPDR®S&P 500 ETF Trust (NYSE: SPY) +11.08%, since February 9, 2022, when QVI’s first sector holding, BRK.B, was added to the Concentrated Stock Picks.

BRK.B +21.21% and V +21.24% have outperformed the sector and market in total returns during the two-year coverage period.

Of note, BRK.B +1,421 basis points (bps) and V +1,840 bps have each achieved alpha since their inception dates in the QVI Real-Time Stock Picks.

Next, we’ll look at each company’s returns on management and enterprise downsize risks and each stock’s present value, including shareholder yields, valuation multiples, and share price downside risks, exclusive to Quality Value Investing’s premium (paying) subscribers. The post concludes with the updated views on each covered stock.

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