One of Warren Buffett’s most successful investments was in American Express, just after the ‘Salad oil scandal’ hit. A company had been faking inventory to receive loans secured against it, and American Express was one of the casualties when the scam was uncovered. The stock plunged 50% and allowed Buffett to secure a strong growing business at a cheap price. Higher One (NASDAQ:ONE) is a financial services company offering debit card accounts and electronic payment facilities targeted at HE institutions and students. It is being hit with its own set of scandals which leaves the stock trading at a forward P/E ratio of just 7 despite returns on equity of 15% (which have historically been much higher at ~30%).
