Warren Buffett is probably most notable in his investment style as a proponent of being a common-sense, longer-term investor. By using this approach, the man has become known as the world's most successful investor. His long track record of success is unprecedented and, according to Forbes, Warren Buffett is among the richest men in the world with a total net worth in the neighborhood of $50 billion.
When seeking for opportunities to fund future growth, Buffett prefers companies that can meet their requirements through internally generated cash, as opposed to raising capital by taking on debt or issuing more stock. This ensures the companies aren’t dependant on securing loans to stay in business. By contrast, companies with large amounts of debt are usually dependent on external financing to keep growing and operating.
Of utmost importance to Buffet is the company's financial performance consistency. He looks for a growing company with no negative years of earnings growth in the past 5 years. If the company has had even one year of negative earnings growth in the last 5 years, he will not even consider it. The earnings per share (EPS) must be constantly growing.
So what does Buffet think of the U.S. economy and the markets current direction? He's quite bullish, even stating that 100% of his non-Berkshire net worth will soon be in U.S. equities if prices continue to look attractive. He believes that in 10-20 years from now most major companies will be setting new profit records.
With unparallel long term success and returns that would make most others' performance pale, it isn't much of a tossup whether or not his latest decision will yield great returns. While he isn't able to predict the short-term movements of the stock market, the odds are certainly with him over the long term.