His approach has allowed him to amass a personal fortune worth billions of dollars.

And many of those who have put their trust and cash in Mr Buffett's capable hands have become incredibly wealthy.

Like most other shares, Berkshire Hathaway shares have suffered as markets have nosedived, shedding about 7% of their value last Friday.

It's unlikely Warren Buffett will be losing sleep over the current downturn though.

History repeats

He's seen it all before.

And he knows how to take advantage when shares are going cheap.

In times like these, studying Mr Buffett's previous purchases during downturns could pay handsomely.

Let's look at three investments Mr Buffett made after markets crashed. Two were during the Global Financial Crisis (GFC), and one was a few years later.

General Electric (NYSE: GE)

In 2008, amid the GFC, the General Electric share price shed more than 30% of its value.

Around that time, Buffett's Berkshire Hathaway invested $3 billion in the multinational conglomerate.

It would prove to be an incredibly fruitful deal for Berkshire Hathaway and its shareholders.

By 2018, Buffett could claim that his $3 billion investment had provided a profit of about $1.5 billion, representing a 50% return.  

Goldman Sachs (NYSE: GS)

In September 2008, also amid the GFC, shortly before his investment in General Electric, Buffett's Berkshire Hathaway acquired a 10% stake in Goldman Sachs.

At that time, shares in the bank were trading at around USD$150.

When Berkshire Hathaway sold its stake at the start of the pandemic in 2020, it collected a profit of around USD$3 billion.

Bank of America (NYSE: BAC)

A few years after the start of the GFC, another financial crisis rattled markets.

Concerns about the level of the US government's spending led to the US debt ceiling crisis.

The Bank of America share price took a hit.

At the start of 2011, Bank of America shares were trading at around $14.

By the end of the year, the bank's share price had plummeted, losing more than 50% of its value.

Amid the steep declines, Buffett saw an opportunity.

Berkshire Hathaway pumped $5 billion into the ailing bank and continued to increase its holdings over the years.

Towards the end of last year, reports of Berkshire Hathaway reducing its stake in Bank of America began to emerge.

In October 2024, it was reported that Berkshire Hathaway had downsized its position in Bank of America by 26%.

Around that time, Bank of America shares were changing hands for more than $40 each.

Clearly, Buffett knows not only when to buy but also when to sell.

The post Warren Buffett's greatest GFC investments, what can we learn? appeared first on The Motley Fool Australia.

Extending its 23%-plus climb during 2024, the S&P 500 started 2025 off with a bang, rising 2.7% in January.

And while some S&P 500 companies failed to keep pace with the index's gain, others soared. Representing a range of industries, the five top-performing S&P 500 stocks all rose more than 20% last month with Robinhood Markets (NASDAQ: HOOD) leading the pack.

1. Robinhood Markets (up 39.4%)

Investors hate uncertainty. So when they gained clarity into how the Securities and Exchange Commission (SEC) investigation against Robinhood regarding securities violations would resolve (Robinhood will pay $45 million in penalties), investors rejoiced, sending the stock soaring.

2. Twilio (up 35.6%)

Twilio (NYSE: TWLO) held its Investor Day on Jan. 23, and investors liked what they heard. The software company, which supports artificial intelligence developers, expects to generate positive operating income in 2025 and more than $3 billion in free cash flow from 2025 through 2027.

3. Constellation Energy (up 34.1%)

Days after the ball had dropped, Constellation Energy (NASDAQ: CEG) powered higher, when it announced its plan to acquire Calpine, an electric utility with robust clean energy assets. The utility stock soared 25% higher on the day of the news.

4. CVS Health (up 25.8%)

Inspired by a proposal from the Centers for Medicare and Medicaid Services that Medicare Advantage payments rise 4.3% on average, investors bid CVS Health (NYSE: CVS) stock higher. An analyst's positive take also contributed to the stock's movement. Evercore ISI hiked its price target to $65 from $60.

5. GE Aerospace (up 22%)

GE Aerospace (NYSE: GE) lifted investors' spirits when it reported strong financial results. Compared to Q4 2023, revenue and free cash flow climbed 14% and 21%, respectively, in the fourth quarter of 2024. The market also celebrated management's auspicious 2025 forecast that includes continued free cash flow growth.

Is now the time to buy these S&P 500 stars?

The top-performing S&P 500 stocks in January are industry leaders that are certainly worth further investigation. Potential investors should ensure that they match their individual investing goals.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

The post These were the 5 top-performing stocks in the S&P 500 in January 2025 appeared first on The Motley Fool Australia.

At the time of writing, the rare earths developer's shares are up 6% to 35.5 cents.

Why is the Arafura share price racing higher?

Investors have been bidding the Arafura share price higher this morning after the company released an update on the funding of the Nolans Project.

According to the release, Arafura has received a letter of interest (LOI) from Canadian export credit agency Export Development Canada (EDC) for the provision of potential financing of up to US$300 million for the Nolans Project.

Management notes that the indication of support from EDC is linked to a strategic arrangement between EDC and General Electric Co (NYSE: GE) to advance the energy transition. In July 2022, Arafura and GE signed a memorandum of understanding for the supply of NdPr from Nolans for use in the manufacture of permanent magnets used in GE's offshore wind turbines.

GE has facilitated Arafura's engagement with EDC, enabling access to the financing. However, it is worth noting that EDC's indicative support is not a commitment, and its participation is subject to its standard due diligence procedures.

But if all goes to plan, things are looking good for Arafura's funding. Management notes that it aligns with in-principle letters of support from Germany's Euler Hermes for up to US$600 million and up to a combined A$350 million from Export Finance Australia and the Northern Australia Infrastructure Facility.

'We are delighted'

Arafura's managing director, Gavin Lockyer, was very pleased with the news. He said:

We are delighted to receive indicative support from Export Development Canada for the Nolans Project. This is further demonstration of the strategic significance that international governments place on the project and its capacity to provide a sustainable supply of critical NdPr to meet the needs of major businesses in key global jurisdictions. We are proud to include GE among the tier-one OEMs associated with offtake from Nolans, and welcome GE's provision of its Aero power generation technology for the Project.

The post 'We are delighted': Why the Arafura share price is racing higher on Tuesday appeared first on The Motley Fool Australia.

GE held on to the title with an iron fist for nearly two years:

GE MARKET CAP DATA BY YCHARTS.

Exxon takes over

By the summer of 2002, Microsoft had recuperated while oil producer ExxonMobil rose through the ranks. The top spot shifted between these three companies over the next four years, and then Exxon controlled the crown between 2006 and 2011:

GE MARKET CAP DATA BY YCHARTS.

At this point, Apple had turned its iPhone and iPad product lines into a world-class cash machine. Apart from a brief skirmish with Exxon in 2013, Cupertino monopolized the market cap throne for seven years:

GE MARKET CAP DATA BY YCHARTS.

What's new?

And now we're in the modern era. Apple is still the monarch of the market cap, but the title always seems to be within reach of Microsoft and e-commerce veteran Amazon. Online services expert and Google parent Alphabet has also joined the fray every now and then, but never quite managed to reach the top spot:

GE MARKET CAP DATA BY YCHARTS.

What have we learned from these charts?

In two decades and change, we've seen the business world shift away from oil producers and industrial-engineering companies while software, online services, and consumer electronics soared higher and higher. Amazon and Apple were mere minnows at the start of this adventure, with respective market caps of $27 billion and $17 billion at the turn of the millennium.

Over the same period, the early leaders have fallen out of sight. These days, General Electric and ExxonMobil are so far behind that they don't even belong in this conversation anymore. (The bigger they are, the harder they fall.)

Come back in another couple of decades, and the list of the market's largest market caps will probably look very different once more. Not even Apple and Microsoft are immune to market shifts and new challengers in the long run. The biggest winners in this millennium weren't the largest blue-chip companies at the start of the race, but the smaller and hungrier upstarts that were still piecing together their long-term business plans:

AAPL TOTAL RETURN PRICE DATA BY YCHARTS.

The post The world's most valuable companies from 2000 to 2022 appeared first on The Motley Fool Australia.

But eventually government stimulus will end, interest rates will rise, and the party will wind up.

So who will be left with a massive hangover afterwards?

Evans & Partners head of international equities Bob Desmond warned that there's always a serious risk some investors could see their capital "permanently impaired". 

Even in a bull market, some shares have certain hints that make it more likely that a devastating loss could come.

Desmond pointed out the 5 biggest warning signs to look out for:

Big debt

Borrowing money is a perfectly legitimate way to grow a business. 

But Desmond suggests keeping an eye on how much is borrowed and how the money is used.

He uses American Airlines Group Inc (NASDAQ: AAL) as an example to demonstrate how foolish some companies can be.

"In the five years to 2019, the company 'returned' US$13 billion in buybacks. This was despite the fact there was no capital to return, as free cash flow over the period was a NEGATIVE US$3.2 billion!" he said on Livewire.

"The ratio of debt to earnings before income, taxes, depreciation and amortisation (EBITDA) was 4.2 times in 2019 at the peak of the cycle."

Share buybacks are a common way for US companies to return capital to shareholders, similar to how dividends are regularly used in Australia.

Desmond was scathing of an airline borrowing this much money only to give it away.

"In our opinion this is highly irresponsible, given the industry already has a high degree of operational gearing, has a large amount of off-balance sheet debt in the form of leases and is vulnerable to rising oil prices," he said.

"And then when tough times hit, these companies go cap-in-hand to the government and/or shareholders to repair balance sheets at very depressed equity prices, resulting in severe value destruction."

Relying on accurate forecasts of something that's hard to forecast

There is always some risk when a stock is hyped up on a future assumption.

It's fair enough if the forecast is reasonable, but it could spell disaster if it's something that's hard to predict.

"We deliberately avoid businesses that rely on us correctly forecasting commodity prices, interest rates, elections, drug discoveries, economic growth or political outcomes," said Desmond.

"Experience has taught us that very few people are able to do this on a consistent basis."

For example, he recalled back in 2016 very few investors expected Donald Trump to win the US presidential election.

"And for those who did, how many predicted that markets would rally?" Desmond said.

"Or in March of this year, who would have thought the market would be at an all-time high in December, when the global economic contraction has been the largest since the Great Depression?"

No moat

A proper competitive advantage is a basic investment axiom. But it can get lost in the fervour of a bull market.

"Superior returns on capital normally arise from some form of competitive advantage – be it a brand, network effect, scale, reputation, data, client relationships, IP or technology," Desmond said.

"Over time, competition does a pretty good job of taking away excess returns for most businesses. And over time, it is very hard for an investor to earn a return much different than the underlying economics of the business one owns."

Poor management burning through cash

Terrible business decisions can cost even the biggest of companies dearly.

Desmond takes the example of General Electric Company (NYSE: GE). It was for many decades an industrial giant, but then started diversifying into finance, real estate, insurance and media.

"The end result was to take a AAA rated balance sheet and turn it into one that is now barely above junk status."

GE shares sold for about US$57 in the year 2000, but now trades for US$10.56.

In Australia, Desmond cites Woolworths Group Ltd (ASX: WOW) and Wesfarmers Ltd (ASX: WES)'s very expensive diversification attempts a few years ago.

"Who can forget Woolworths' ill-timed home improvement venture against the toughest of competitors, or even Bunnings themselves and their venture into the UK?" he said.

"Would it not have made sense to focus capital on the competitive advantage that made the company a market leader in the first place and then return excess capital to shareholders?"

Expensive share price

Buying shares cheaply sounds obvious. But again, in a mad 'fear of missing out' scramble, human nature can easily ignore 'fair value'.

"Even the most disciplined can be lured into paying inflated prices, especially in the upper reaches of a bull market," Desmond said.

"The narrative always follows a similar pattern that excess growth will last forever, interest rates will never rise, the company has changed (very few do), the company deserves a lower beta and the list goes on."

The post 5 ways to lose your money forever appeared first on The Motley Fool Australia.

But even a quality as ethereal as brand value can be measured.

Each year, United States consultancy, Interbrand, publishes a list of the top 100 brands in the world.

Clare Capital analyst, Robin Basra, said the rankings are calculated as a combination of three attributes – financial forecasts, the role of the brand and the strength of consumer preference for the brand.

And the world has dramatically shifted to technology over the past 10 years.

"A decade ago, Coca-Cola Co (NYSE: KO), IBM (NYSE: IBM), Microsoft Corporation (NASDAQ: MSFT), Google (Alphabet Inc (NASDAQ: GOOGL) (NASDAQ: GOOG)) and General Electric Company (NYSE: GE) represented the most valuable brands in the world," said Basra.

"In 2020, Google and Microsoft retain their positions, Apple Inc (NASDAQ: AAPL) has replaced IBM as the most valuable technology brand, and the others have fallen lower down the order – signalling changing dynamics and consumer preferences."

Another nod to the way the globe is shifting is that a non-American company, Samsung Electronics Co Ltd (KRX: 005930), snuck in at fifth place.

Valuable brands outperform rest of share market

This brand value thing matters on the stock market. 

In a year when most publicly listed companies were hammered by COVID-19, the share prices of the five most valuable brands were up 54% on average.

Even when generalised out to the 100 most valuable brands, their collective share price has outperformed the S&P 500 Index (SP: .INX) by more than double.

Most valuable brands by sector

The brand leaders for each sector have also shown healthy share price growth. 

The exception is Toyota Motor Corp (TYO: 7203), which perhaps isn't surprising considering the economic downturn.

The post What COVID-19? World's 5 most valuable brands are up 54% appeared first on The Motley Fool Australia.

Blue-chip potential

CSL Limited (ASX: CSL) and Cochlear Limited (ASX: COH) are heralded among long term investors as two of the most rewarding companies on the ASX. Both companies have provided sustainable long-term growth and continued innovation has seen them become global leaders in their respective fields. As a supplier of sterilisation equipment to hospitals, Nanosonics shares similar characteristics to the two healthcare giants and could potentially follow in their footsteps.

Nanosonics was founded in 2000 and is a global provider of sterilisation devices to hospitals and healthcare centres. The company's flagship Trophon device sterilises ultrasound probes without the use of chemicals and sells for more than $10,000. The Nanosonics business model also generates revenue from its 'consumable' components which are patented, protecting Nanosonics from being undercut by competitors. Many investors and analysts have high hopes for Nanosonics, given the company's sticky business model, dual revenue streams, and large addressable market.

Solid results

Earlier this year, Nanosonics delivered a strong half-year report, highlighted by a 221% increase in net profit of $7.1 million and record first-half sales revenue of $40.7 million. Sales of Trophon devices increased 11% and contributed $16.4 million to revenue, while recurring consumables and services were up 59%, generating $24.3 million in revenue.

Fundamentally, Nanosonics looks in good financial health with an expected earnings growth of 48% and a 64% revenue growth, indicating that earnings are driven by high-margin products. The cash balance of Nanosonics grew to $71.3 million in the first half, indicating excellent debt management and opening the potential for further research and product development.

Global and product expansion

Like Cochlear's hearing implants, Nanosonics products are sticky in the sense that hospitals and healthcare centres are unlikely to stop using the devices once they are installed. A lucrative sales agreement with the General Electric Company (NYSE: GE) has allowed Nanosonics to gain 40% of the market share in the United States. Nanosonics aims to develop a global growth strategy as more markets develop, with the company already identifying Europe and Japan as the next regions of growth.  

In addition to further expansion, Nanosonics also intends to dominate the infection prevention sector by investing heavily in research and development. The company looks to grow its product pipeline to address infection prevention not only in hospital settings, but also in dentistry and aged care facilities. Nanosonics aims to develop products that not only kill bacteria, but also collect data that ensures traceability and compliance of infection control standards

Foolish takeaway

As a company with a $1.3 billion market capitalisation and profits less than $10 million, Nanosonics is a long way from the likes of CSL and Cochlear. However, it does share similar characteristics, which could see the company develop into something special.

With its chief executive being the former vice president of global marketing at Cochlear, Nanosonics is poised to execute its global strategy. Equipped with strong fundamentals and a business model that fuels recurring revenue, Nanosonics can take advantage of its market opportunity by continuing research and development to further enhance its product pipeline.

The post Is Nanosonics the next ASX healthcare blue-chip? appeared first on The Motley Fool Australia.

And despite Ferrari being nominated as the world's most powerful brand, it ranks 350th in the world with a value of US$4 billion. CEO of Brand Finance, David Haigh says the Italian car maker's mix of desirability, loyalty and consumer sentiment give the company an indisputable brand power.

The top 10 most valuable brands list is dominated by tech companies, with most domiciled in the US.

So without further ado, here's the list of companies, country and their estimated brand value, in US$.

Source: Brand Finance

The top 4 have retained their positions from 2013. Big movers up include, Verizon, GE and AT&T, while Walmart, IBM and Coca-Cola all slumped. Coca-Cola came in at number 12 this year, after holding down ninth last year.

The post The world's top 10 most valuable brands appeared first on The Motley Fool Australia.