Serious Money: Better than Apple, Google, Microsoft & Berkshire Hathaway, Part 3

Some might be convinced already and others may just find Williams to be too darn boring to keep their attention. However, if you follow "my pal Warren," boring is good!

So far, every metric has implied that Williams is indeed the greatest value, but I will continue to see if I can find where this trend might break down, starting with how the company is doing allocating its resources by looking at the return on invested capital (ROIC).

• Microsoft (MSFT): 52.48
• Apple (AAPL): 27.19
• Google (GOOG): 16.60
• Williams Companies (WMB): 11.06
• Berkshire Hathaway (BRK.B): 4.08

This is the first time Williams comes up short, and Microsoft can crow that it is still king. To understand this metric one only has to look at Microsoft's cost of licensing its software to be installed in a new PC -- close to nothing. This compared to leasing drilling rigs for exploration and building out new pipelines and maintaining them.

In context, for comparison within WMB's industry, Dynegy Inc. (NYSE: DYN) has a ROIC of 4.27, less than half. Not to make excuses, the technology companies do much better and achieve more bang for the buck.

Looking still further, the following lists the return-on-equity per share.

• Microsoft (MSFT): 49.67
• Apple (AAPL): 24.30
• Williams Companies (WMB): 18.95
• Google (GOOG): 16.72
• Berkshire Hathaway (BRK.B): 4.34

Here Williams makes a respectable showing, but Microsoft continues to eat everyone else's lunch. If this were the only criteria we were looking at, then Microsoft would be the one to buy and there might be some question why Williams is worth the fuss. Berkshire Hathaway would bring snickers and questions as to why it was even in the mix.

There are folks that worry about what will happen to Berkshire Hathaway when Warren Buffett and Charlie Munger are gone, but given the number of companies it owns and the vanilla nature of them, the only thing to fret about is probably where growth will come from. To me, that is not much of an issue since I think Its size alone restricts that.

Apple investors and analysts are more concerned, it seems, with the health of Steve Jobs, the founder and chairman of Apple who has taken a medical leave of absence. His value to the company is immeasurable, and while the current team is very capable, there must be some doubts as to whether they can continue to invent and, more importantly, execute over the long term without him.

In this regard, it would seem Google and Microsoft are better situated from a risk standpoint, and Williams, being the most vanilla and most focused of all, might present the least investment risk.

Previous posts:
Serious Money: Better than Apple, Google, Microsoft & Berkshire Hathaway, Part 1 and Part 2

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares of BRK.B and WMB shares and options.