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Buffett looks for businesses with a high return on invested capital from "summary" of Warren Buffett's Ground Rules by Jeremy C. Miller
Warren Buffett seeks out businesses that have a high return on invested capital. This means that he is looking for companies that can generate a significant amount of profit relative to the amount of money invested in the business. A high return on invested capital indicates that a company is able to efficiently allocate its resources and generate strong profits. By focusing on businesses with a high return on invested capital, Buffett is essentially looking for companies that have a competitive advantage. These companies are able to earn high profits because they have some sort of unique advantage that allows them to outperform their competitors. This could be due to factors such as strong brand recognition, economies of scale, or proprietary technology. Buffett believes that companies with a high return on...
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