MW How you as an investor can avoid mistakes that are made even by Warren Buffett and other market veterans
By Philip van Doorn
Also: Stock and real-estate market warnings, Eli Lilly's success, a mixed response to Nvidia and how cuts to Social Security and other government agencies can affect you or loved ones
On Feb. 22, Warren Buffett published his annual letter to shareholders, in which the Berkshire Hathaway Inc. $(BRK.B)$ chief executive provided his customary detailed discussion of the company's varied business and outlined his investment philosophy.
Buffett also mentioned the mistakes he made along the way - some of which he might have avoided if he had been more disciplined in sticking with his own strategy.
Anyone interested in investing can learn something from the letter, no matter how much experience they have in industry or markets. You can read it here.
In Wednesday's "Need to Know" column, Barbara Kollmeyer shared words of wisdom from Larry Swedroe, who has written many books about investing during a long career managing money. He quoted Buffett and Peter Lynch while providing four lessons about investing that can be avoided easily but can spell doom, even for market experts.
You can sign up here to receive the daily "Need to Know" newsletter in your inbox early each morning. It includes the latest market buzz and "the call of the day" from an investor, trader, economist or other financial professional.
Are you worried about how politics or the economy might hurt you as an investor?
There is always financial risk involved in investing. The early days of the Trump administration are showing that it's important to be aware of uncertainty - no matter if you're a Democrat or Republican, or however you feel about the administration. This week, Quentin Fottrell noted the key to adapting to changes in the economic environment.
Market warnings
No matter what is going on in the economy or markets, there are daily warnings that stock prices are headed for a major decline. The above chart underscores the current buzz that U.S. stocks are expensive and due for a broad pullback. The S&P 500 SPX trades at a forward price-to-earnings ratio of 21.3, compared with a 20-year average valuation of 16.2. These are weighted ratios of companies' share prices to rolling consensus 12-month earnings-per-share estimates among analysts polled by FactSet.
Joseph Adinolfi shared various warnings about the stock market this week:
-- 'Stock markets today are just about as risky as I have ever seen': Elliott's Paul Singer gives rare interview
-- The 'vibes' on Wall Street are starting to sour. Just look at these six charts.
-- Trump's tariff push has spooked investors. Here's what it would take for him to step in to stop the selling.
More warnings:
-- What Warren Buffett really thinks about the stock market
-- Three catalysts have driven S&P 500 corrections since 1964. Here's what could spark one now.
How might you or your loved ones be affected by cuts to government agencies?
On Thursday, the Social Security Administration announced it would soon undergo a reorganization that would "include significant workforce reductions."
Jessica Hall looked further into the potential job cuts, the scope of the agency's work and the looming Social Security funding shortfall.
And despite President Trump's vocal support for the federal government's funding of state Medicaid programs, the budget reconciliation process in Congress could lead to cuts - beyond Trump's stated goal of eliminating inefficiency and fraud.
Beth Pinsker explained how cuts to Medicaid funding might be applied, and how that could upend nursing homes.
Brett Arends: Why the Medicaid 'chainsaw' will come for your home
Nvidia beats estimates and the stock sinks
Nvidia Corp. $(NVDA)$ reported quarterly results that beat analysts' estimates for revenue and earnings, but the stock still declined 8.5% on Thursday. It was down 17% from a week earlier. For 2025, the stock has declined 10.5%, following a 171% return in 2024, with dividends reinvested.
What might be weighing on investors' minds is a slowing of Nvidia's sales and earnings increases. The numbers are still good and would be stellar for nearly any other company. But it might have been too easy to get used to triple-digit year-over-year comparisons that began less than two years ago when the company established its dominance in what was then a new market for graphics processing units (GPU) being installed by data centers to support the development of artificial intelligence technology.
Here are the sequential and year-over-year increases in the company's revenue for the past eight quarters:
Fiscal quarter ended Sales ($mil) Sequential change Year-over-year change
Oct. 2024 $35,082 17% 94%
July 2024 $30,040 15% 122%
April 2024 $26,044 18% 262%
Jan. 2024 $22,103 22% 265%
Oct. 2023 $18,120 34% 206%
July 2023 $13,507 88% 101%
April 2023 $7,192 19% -13%
Jan. 2023 $6,051 2% -21%
Source: FactSet
And here are the same comparisons for earnings per share:
Fiscal quarter ended EPS Sequential change Year-over-year change
Oct. 2024 $0.78 17% 110%
July 2024 $0.67 12% 170%
April 2024 $0.60 21% 629%
Jan. 2024 $0.49 33% 764%
Oct. 2023 $0.37 50% 1263%
July 2023 $0.25 202% 849%
April 2023 $0.08 44% 29%
Jan. 2023 $0.06 110% -52%
Source: FactSet
Emily Bary led team coverage of Nvidia's results and its annual report. She also previewed an event in March that could reverse this year's slide for Nvidia's stock.
More: Nvidia is the biggest chip player. But it also leads by this metric - which may surprise you.
Other tech coverage:
-- Super Micro's stock surges. Here's what's really behind the big rally.
-- Why Apple's stock has held ground as the 'Magnificent Seven' have faltered
A big week for Eli Lilly
Through Thursday, shares of Eli Lilly & Co. $(LLY)$ were up 4% from a week earlier and up 17.5% for 2025, with dividends reinvested. And those gains followed a return of 31.5% in 2024, on the success of the company's GLP-1 medications for Type 2 diabetes and weight loss.
Ciara Linnane covered a new drug-pricing plan from Eli Lilly this week, which could upend the GLP-1 market, and the company's new plan to expand production at four U.S. sites.
Pricing pressure: In China you can get Ozempic and Wegovy within the hour for only $100 a month
Home builders take their lumps
In this week's ETF Wrap, Christine Idzelis looked into this year's performance for exchange-traded funds that focus on a particular industry - residential construction in the U.S. February has been a rough month for these ETFs and these are the factors that have been driving the group down.
Housing coverage:
-- The brightest spot in the housing market is fading fast
-- Mortgage rates are falling. Here's how much income you need now to buy a house for $250,000, $400,000 and $1 million.
Retirement - managing IRAs and taxes
Alessandra Malito writes the Help Me Retire column. This week she helped a reader who had a complex question. He has a traditional IRA and expects to have $4.5 million in the account when he is required by the Internal Revenue Services to begin taking annual required minimum distributions when he is 75. Right now the RMD age is 72, but it will increase to 75 in 2033.
Based on IRS life-expectancy tables, on which annual RMD amounts are based, the reader's estimated required IRA distribution for the first year will be more than $180,000. That money would be taxed as regular income. So the question is, should he do a full or partial conversion to a Roth IRA? He would face the income-tax burden immediately, owing no taxes when the RMD payouts begin.
But the decision is more complicated. Here are all the factors to consider for a Roth conversion decision, including timing requirements and a possible mix-and-match approach.
More retirement help: I'm 45 and my 401(k) was frozen. Should I roll it over to a bigger account, a Roth IRA or just withdraw all $140K?
Are meme coins ruining the bitcoin party?
Bitcoin (BTCUSD) was trading for $83,670 Friday morning, down 23% from an intraday high of $109,225 on Jan. 20, according to CoinDesk. The Friday price was down 9% from the end of 2024. That was the day President Trump began his second term, and the president has often expressed support for virtual currencies.
In this week's Distributed Ledger newsletter, Frances Yue looked into the phenomenon of meme coins and or not meme coins, which helped lead last year's rally for virtual currencies were hurting bitcoin and ether (ETHUSD) in 2025.
What should you stream in March?
Mike Murphy previewed "a relatively slow month" for streaming content and offered advice on how to cut expenses with an ideal mix of streaming services.
Want more from MarketWatch? Sign up for this and other newsletters to get the latest news and advice on personal finance and investing.
-Philip van Doorn
MW How you as an investor can avoid mistakes that are made even by Warren Buffett and other market veterans
By Philip van Doorn
Also: Stock and real-estate market warnings, Eli Lilly's success, a mixed response to Nvidia and how cuts to Social Security and other government agencies can affect you or loved ones
On Feb. 22, Warren Buffett published his annual letter to shareholders, in which the Berkshire Hathaway Inc. (BRK.B) chief executive provided his customary detailed discussion of the company's varied business and outlined his investment philosophy.
Buffett also mentioned the mistakes he made along the way - some of which he might have avoided if he had been more disciplined in sticking with his own strategy.
Anyone interested in investing can learn something from the letter, no matter how much experience they have in industry or markets. You can read it here.
In Wednesday's "Need to Know" column, Barbara Kollmeyer shared words of wisdom from Larry Swedroe, who has written many books about investing during a long career managing money. He quoted Buffett and Peter Lynch while providing four lessons about investing that can be avoided easily but can spell doom, even for market experts.
You can sign up here to receive the daily "Need to Know" newsletter in your inbox early each morning. It includes the latest market buzz and "the call of the day" from an investor, trader, economist or other financial professional.
Are you worried about how politics or the economy might hurt you as an investor?
There is always financial risk involved in investing. The early days of the Trump administration are showing that it's important to be aware of uncertainty - no matter if you're a Democrat or Republican, or however you feel about the administration. This week, Quentin Fottrell noted the key to adapting to changes in the economic environment.
Market warnings
No matter what is going on in the economy or markets, there are daily warnings that stock prices are headed for a major decline. The above chart underscores the current buzz that U.S. stocks are expensive and due for a broad pullback. The S&P 500 SPX trades at a forward price-to-earnings ratio of 21.3, compared with a 20-year average valuation of 16.2. These are weighted ratios of companies' share prices to rolling consensus 12-month earnings-per-share estimates among analysts polled by FactSet.
Joseph Adinolfi shared various warnings about the stock market this week:
-- 'Stock markets today are just about as risky as I have ever seen': Elliott's Paul Singer gives rare interview
-- The 'vibes' on Wall Street are starting to sour. Just look at these six charts.
-- Trump's tariff push has spooked investors. Here's what it would take for him to step in to stop the selling.
More warnings:
-- What Warren Buffett really thinks about the stock market
-- Three catalysts have driven S&P 500 corrections since 1964. Here's what could spark one now.
How might you or your loved ones be affected by cuts to government agencies?
On Thursday, the Social Security Administration announced it would soon undergo a reorganization that would "include significant workforce reductions."
Jessica Hall looked further into the potential job cuts, the scope of the agency's work and the looming Social Security funding shortfall.
And despite President Trump's vocal support for the federal government's funding of state Medicaid programs, the budget reconciliation process in Congress could lead to cuts - beyond Trump's stated goal of eliminating inefficiency and fraud.
Beth Pinsker explained how cuts to Medicaid funding might be applied, and how that could upend nursing homes.
Brett Arends: Why the Medicaid 'chainsaw' will come for your home
Nvidia beats estimates and the stock sinks
Nvidia Corp. (NVDA) reported quarterly results that beat analysts' estimates for revenue and earnings, but the stock still declined 8.5% on Thursday. It was down 17% from a week earlier. For 2025, the stock has declined 10.5%, following a 171% return in 2024, with dividends reinvested.
What might be weighing on investors' minds is a slowing of Nvidia's sales and earnings increases. The numbers are still good and would be stellar for nearly any other company. But it might have been too easy to get used to triple-digit year-over-year comparisons that began less than two years ago when the company established its dominance in what was then a new market for graphics processing units (GPU) being installed by data centers to support the development of artificial intelligence technology.
Here are the sequential and year-over-year increases in the company's revenue for the past eight quarters:
Fiscal quarter ended Sales ($mil) Sequential change Year-over-year change
Oct. 2024 $35,082 17% 94%
July 2024 $30,040 15% 122%
April 2024 $26,044 18% 262%
Jan. 2024 $22,103 22% 265%
Oct. 2023 $18,120 34% 206%
July 2023 $13,507 88% 101%
April 2023 $7,192 19% -13%
Jan. 2023 $6,051 2% -21%
Source: FactSet
And here are the same comparisons for earnings per share:
Fiscal quarter ended EPS Sequential change Year-over-year change
Oct. 2024 $0.78 17% 110%
July 2024 $0.67 12% 170%
April 2024 $0.60 21% 629%
Jan. 2024 $0.49 33% 764%
Oct. 2023 $0.37 50% 1263%
July 2023 $0.25 202% 849%
April 2023 $0.08 44% 29%
Jan. 2023 $0.06 110% -52%
Source: FactSet
Emily Bary led team coverage of Nvidia's results and its annual report. She also previewed an event in March that could reverse this year's slide for Nvidia's stock.
More: Nvidia is the biggest chip player. But it also leads by this metric - which may surprise you.
Other tech coverage:
-- Super Micro's stock surges. Here's what's really behind the big rally.
-- Why Apple's stock has held ground as the 'Magnificent Seven' have faltered
A big week for Eli Lilly
Through Thursday, shares of Eli Lilly & Co. (LLY) were up 4% from a week earlier and up 17.5% for 2025, with dividends reinvested. And those gains followed a return of 31.5% in 2024, on the success of the company's GLP-1 medications for Type 2 diabetes and weight loss.
Ciara Linnane covered a new drug-pricing plan from Eli Lilly this week, which could upend the GLP-1 market, and the company's new plan to expand production at four U.S. sites.
Pricing pressure: In China you can get Ozempic and Wegovy within the hour for only $100 a month
Home builders take their lumps
In this week's ETF Wrap, Christine Idzelis looked into this year's performance for exchange-traded funds that focus on a particular industry - residential construction in the U.S. February has been a rough month for these ETFs and these are the factors that have been driving the group down.
Housing coverage:
-- The brightest spot in the housing market is fading fast
-- Mortgage rates are falling. Here's how much income you need now to buy a house for $250,000, $400,000 and $1 million.
Retirement - managing IRAs and taxes
Alessandra Malito writes the Help Me Retire column. This week she helped a reader who had a complex question. He has a traditional IRA and expects to have $4.5 million in the account when he is required by the Internal Revenue Services to begin taking annual required minimum distributions when he is 75. Right now the RMD age is 72, but it will increase to 75 in 2033.
Based on IRS life-expectancy tables, on which annual RMD amounts are based, the reader's estimated required IRA distribution for the first year will be more than $180,000. That money would be taxed as regular income. So the question is, should he do a full or partial conversion to a Roth IRA? He would face the income-tax burden immediately, owing no taxes when the RMD payouts begin.
But the decision is more complicated. Here are all the factors to consider for a Roth conversion decision, including timing requirements and a possible mix-and-match approach.
More retirement help: I'm 45 and my 401(k) was frozen. Should I roll it over to a bigger account, a Roth IRA or just withdraw all $140K?
Are meme coins ruining the bitcoin party?
Bitcoin (BTCUSD) was trading for $83,670 Friday morning, down 23% from an intraday high of $109,225 on Jan. 20, according to CoinDesk. The Friday price was down 9% from the end of 2024. That was the day President Trump began his second term, and the president has often expressed support for virtual currencies.
In this week's Distributed Ledger newsletter, Frances Yue looked into the phenomenon of meme coins and or not meme coins, which helped lead last year's rally for virtual currencies were hurting bitcoin and ether (ETHUSD) in 2025.
What should you stream in March?
Mike Murphy previewed "a relatively slow month" for streaming content and offered advice on how to cut expenses with an ideal mix of streaming services.
Want more from MarketWatch? Sign up for this and other newsletters to get the latest news and advice on personal finance and investing.
-Philip van Doorn
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February 28, 2025 13:11 ET (18:11 GMT)
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