Tickers in this Article: CMG, BRK, MCD, YUM
Fortunately for you, this is not an article where I am going to articulate the merits of one particular company and why it is the best investment to own for everyone. Even as much as I admire Warren Buffett and base my investment philosophy on his teachings, I won't even say that Berkshire Hathaway (NYSE:BRK-A) (NYSE:BRK-B) is the most desirable investment for every investor.

What Matters for Everyone
It's actually quite simple in determining the only investment or investments you should own. It comes down to one question that should be carefully examined before devoting additional time going forward. Before making any investment, you must first ask: "Would I want to own 100% of this business at the current price?"

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If you can arrive at a yes, then you have found a worthwhile investment opportunity. But answering this question accurately means you will have spent time examining the business, its management, and the competition - things that any prudent and rational buyer of an entire business would do. Once that part is done, you move on to the second part - is the price right? It's not hard to find companies that fulfill the first part of the question; the difficulty is finding ones that qualify on both counts. (For further reading, check out The Value Investor's Handbook.)

I Continue to Wait
One of my favorite businesses today is Chipotle (NYSE:CMG), a fast casual chain of fresh Mexican food. Anyone that likes burritos and tacos will likely have a very favorable opinion on Chipotle. However, shares are far too rich. And because the company is doing so incredibly even during this economy, the shares attract growth chasers who bid the shares up. Today they are at $80, implying a P/E of 28. Prior to the recession, shares were nearly double that price at an even much higher valuation. (For related reading, check out Why Warren Buffett Envies You.)

With just over 900 restaurants, its not hard to see why shares command a premium. McDonalds (NYSE:MCD) has over 31,000 stores; Yum Brands (NYSE:YUM) which operates Pizza Hut and Taco Bell, has over 36,000 stores. If Chipotle gets to one-tenth of this store count, it will have nearly quadrupled its current store count.

The Bottom Line: Pay A Fair Price For Quality
Value investing is not a rigid approach that says only stocks trading at single digit P/E's and below book qualify as attractive investments. Value investing is really about looking at investing from the perspective of a business owner. It allows us to look at a company like Chipotle and realize that its a good bet at 15-times earnings, instead missing out on opportunities due a rigid framework. Price is what you pay and value is what you get. (For related reading, check out Stock-Picking Strategies: Value Investing.)

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