To the frugal value investor, it might seem off that Warren Buffett's Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) owns shares of cloud-based data company Snowflake (NYSE: SNOW) . The stock is anything but cheap. With a price-to-sales ratio of 120, it's a highly risky equity right now. And in the near term, its price is as likely to go down as it is to go up.
I'm a growth investor, and I'm not buying Snowflake at these prices. The only reason Berkshire Hathaway owns that company, in my opinion, is that Berkshire won a share price that was unavailable to the general public. Was it a smart move for the managers (not Warren Buffett) who made that deal? Almost certainly, as they got a price of $120, and the stock opened at $245.
The question today is: Can we find stronger investment ideas than Snowflake? The answer is simple -- absolutely. Innovative Industrial Properties (NYSE: IIPR) and Virtu Financial (NASDAQ: VIRT) also have triple-digit revenue growth (like Snowflake). But unlike Snowflake, both of these companies have very nice profit margins, and the stocks are dirt cheap.
For further details see:
2 Game-Changing Stocks That Are Better Buys Than Snowflake