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Navigating Corporate Profitability and Investment Strategies
This chapter examines the financial strategies of S&P 500 companies, focusing on the trends in profitability, earnings, and stock buybacks. It contrasts the approach of Berkshire Hathaway on long-term reinvestment with the prevalent practice of short-term share repurchases, while also addressing the performance and challenges faced by major tech stocks. Additionally, it provides insights into market valuations and the implications of current trends for individual investors, particularly within the context of diversified index investing.