Hey guys,

Been reading the warrent buffet way book, however, I am not too sure if my understanding of the phrase below is 100% correct.

"Each dollar of retained earnings is translated into atleast one dollar of market value."

Retained earnings are the profits from the company right?

So if company X makes 100 million retained profit, they reinvested 100 million back into the company million, they would make another 100 million profit from it?

Therefore translating to at least one dollar of market value right?

Thanks heaps!!!