Tom Russo

Tom Russo

Last Update: 08-11-2015

Number of Stocks: 110
Number of New Stocks: 1

Total Value: $11,379 Mil
Q/Q Turnover: 2%

Details: Top Buys | Top Sales | Top Holdings  Embed:

Tom Russo Watch

  • My Evolution as an 'Intrinsic Value Seeker'

    I’ve been asked many times, “What do you think the intrinsic value is for this company?” Two years ago my answer would be “the intrinsic value of this company is $50, if you assume x% of free cash flow growth in the next few years and y% terminal free cash flow growth and y% discount rate.” If you ask me this question today, I would say, “First of all, that depends on my opportunity cost, which is reflected in the discount rate I use and secondly, over what period of time?”

    This evolution comes from learnings from my personal experiences, and conversations with some of the best value investors such as Tom Russo (Trades, Portfolio), Donald Yacktman, David Rolfe, etc. In the first few years of my value investing journey, I was a firm believer of the conventional wisdom, which says whatever method you use, be it DCF, liquidation value or the Multiple approach, one should calculate the range of intrinsic value of the security and apply a margin of safety when buying the security. If the intrinsic value of the company according to your calculation is $100 per share, you pay $70.


  • Tom Russo Adds to Long-Time Holding in Philip Morris

    Tom Russo (Trades, Portfolio) looks for value and price when making stock selections. If the firm in which he is a general partner with responsibility for $3 billion, Semper Vic Partners, can be said to reflect the influence of his investing philosophy, its success is undeniable. Semper Vic Partners has produced returns of 6.1%, 21.9% and 24.4% in the last three years.

    Russo’s most significant second-quarter acquisition was his addition of 334,598 shares to his stake in Philip Morris International Inc. (NYSE:PM), a cigarette and tobacco company headquartered in New York City and a fixture in his portfolio, for an average price of $82.16 per share. The deal had a 0.24% impact on Russo’s portfolio.


  • Value Investor Tom Russo on the Power of Consumer Brands

    Early in his career, Warren Buffett (Trades, Portfolio) achieved tremendous investment returns by purchasing cheap but not great companies, and then waited for the market to properly value the company.

    Later in his career, Buffett moved toward buying high quality companies at reasonable valuation metrics because these companies could reinvest capital at high rates of return for decades.


  • Nestle and Capacity to Suffer

    It is no secret to the readers on this forum that I am huge admirer of Tom Russo (Trades, Portfolio) and the idea of the “capacity to suffer.” Businesses with capacity to suffer are rare to find so once you find one, you would want to keep them for a very long time. The question then becomes, how can we identify businesses with the capacity to suffer when we don’t have access to management team the way Russo does? Here I am reminded of the answer Tom Gayner gave to a question he was asked on the Google Campus (link to the article):

    I spent more time reading about people using the exact same resources that you would have access to as well as annual reports, proxy statements and magazine articles. And I try to think and just look and get a gut feeling and make some judgment and discernment whether these people are acting in a way that’s reasonable. I encourage you to think about things in that dimension.


  • Tom Russo on Wealth Track – Long-Term Value

    I’ve written in the past on what I have learned from one of the greatest global investors – Tom Russo (Trades, Portfolio). I think the concepts of “capacity to suffer” and “capacity to reinvest” are profound. In this outstanding interview with Consuela Mack, Mr. Russo generously shared his further thoughts on “capacity to reinvest.”


  • How Harley-Davidson Stumbled – Value Investor Tom Russo

    A strong brand name is a powerful moat abound a business.

    Coca-Cola (NYSE:KO) has one and that is why it occupies a permanent position in the Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B) portfolio. Ditto for American Express (NYSE:AXP).


  • Value Investor Tom Russo Discusses Portfolio Management And His Favorite Valuation Metric

    In 2008 Tom Russo (Trades, Portfolio) was able to take profits on several of his core U.S. focused businesses and redeploy those proceeds into bargain international operators.

    Now those international companies represent a large percentage of his portfolio.  

  • A Weekend in Omaha

    This past weekend, I was lucky enough to attend my fourth Berkshire Hathaway (BRK.B) shareholder meeting in Omaha, Nebraska. A few readers that I regularly talk with wanted to know how it went in addition to my takeaways from the weekend’s events; those are the things the remainder of this article will focus on.

    My weekend started Thursday night with a dinner at the University of Nebraska at Omaha put together by Value Investor Conference. The speaker at the event was Tom Russo (Trades, Portfolio), portfolio manager at Gardner Russo & Gardner, an investor that I’ve considered well worth listening to for some time; unsurprisingly, he didn’t disappoint. Much of his speech focused on the concept of “capacity to suffer” – essentially, the willingness of management (in this case, at publicly held corporations) to act in a manner that may negatively impact short-term results.


  • 20 Questions Newsletter Featuring Tom Russo is Ready for Downlaod

    We have recently added "20 Questions with the Gurus" to our website for subscribers to enjoy. Each month, we will interview a new guru, using the questions you submit. Premium members will have higher priority when we choose which questions to submit.

    In addition to reading the interview, subscribers will also have the ability to download the exclusive 20 Questions newsletter. Below is a sample of what the newsletters will look like. This month's features global investor, Tom Russo (Trades, Portfolio).


  • Globetrotting the Tom Russo Way

    Almost three weeks ago, I wrote an article on global investing, which you can find here. In the end, I stated the following:


  • Exclusive Interview With Tom Russo Part II

    This is the second portion of the interview we conducted with Tom Russo (Trades, Portfolio). The first part of ther interview can be found here. We would like to thank our readers again for the questions submitted. Due to time, we were unable to ask all of them.

    6.The power of brands as “a share of the consumer’s mind” is clearly quite important to you and the cash flow that comes from that sort of moat. Any thoughts on technology brands (ex: Facebook (NASDAQ:FB), Google (NASDAQ:GOOG))?


  • Exclusive Q&A Interview With Tom Russo Part I

    We recently had the opportunity to interview guru Tom Russo (Trades, Portfolio) of Gardner Russo & Gardner about his investment strategies in global investing, as well as how he became an investor. The questions asked are from our readers.

    Although we received around 44 questions, we were only able to use 15 of them due to time constraints, but we thank all of your for your submissions and encourage you to please continue to submit your questions for our Q&A’s with the gurus.


  • How to Think About Brands – Tom Russo of Gardner Russo & Gardner

  • Exclusive GuruFocus Q&A With Global Value Investor Tom Russo Coming Soon

    Global value investor Tom Russo (Trades, Portfolio) of Gardner Russo & Gardner has agreed to participate in a Q&A with GuruFocus within the next week. If you, the readers and subscribers, have any questions you would like for us to ask Mr. Russo, please post them in the comment box below.

    Tom Russo (Trades, Portfolio)'s Investment Style


  • Value Investor Tom Russo On The China Factor

    Investors are always leery of China. Respected value investor Tom Russo (Trades, Portfolio) has plenty of exposure to China, but it is through large multi-national countries.

    The growth over the next 30 years is going to be faster in the emerging markets than it will be in developed countries. Russo believes that exposure to that growth is a good idea.


  • Happy Thanksgiving Thoughts – Give and Take

    Each year during this time of the year, I would take some time out and think about the things in life that I am extremely thankful for. The list usually ends up very long but a few of them jump out easily. On this year’s is a book recommendation by one of my heroes – Mohnish Pabrai (Trades, Portfolio). And this book is called Give and Take, masterfully done by Adam Grant.

    This book is about why helping others drivers out success. It is a fascinating idea. Essentially the author claims that there are three types of people – givers, matchers and takers. Takers are people who like to get more than they give, and they tilt reciprocity in their own favor, putting their own interests ahead of other’s needs. Givers are the exact opposite. They tilt reciprocity in the other direction, preferring to give more than they get. They are other-focused, paying more attention to what other people need from them. Matchers strive to preserve an equal balance of giving and getting. They operate on the principle of fairness: when they help others, they protect themselves by seeking reciprocity.


  • Tom Russo's Quarterly Investments Focus on Food and Drink Stocks

    Tom Russo (Trades, Portfolio), general partner of the Semper Vic Partners and Semper Vic Partners (Q.P.) limited partnerships, says his funds are relatively concentrated, and you certainly can see a concentration in his investments in the third quarter – largely in food and drink stocks.

    His investment philosophy emphasizes return on invested capital, principally through equity investments. Semper Vic Partners returned 24.4% in 2012, considerably better than 2011 (6.7%) and better than 2010 (21.5%).


  • Tom Russo Buys Pernod Ricard, Nestle SA, CIE Financiere, Sells Goldman Sachs

    Renowned value investor Tom Russo (Trades, Portfolio) runs a concentrated portfolio full of European family run beverage business and he has done very well with them. It is easy to imitate them as his portfolio turnover is very low. He buys and holds, rarely sells. These are some activities of his during the third quarter of 2014. To learn more about him, please read Transcript of Tom Russo’s Talk at Value Investor Conference.  

  • Motley Fool's Top Positions in the Financial Sector

    Recently, hedge funds have been filing their form 13-F, which is a quarterly report of equity holdings by filed institutional investment managers with at least $100 million in equity assets under management, as required by the United States Securities and Exchange Commission. In this article, let´s concentrate in one particular hedge fund and try to see the principal holdings in its portfolio. I will look into Motley Fool Asset Management.

    Recently, the fund reported its equity portfolio ended September. The total value of the portfolio amounted to $492.4 million, down from $521.5 million disclosed at the end of the previous quarter. Consequently, the fund's equity market change value was negative 21.5 million in the last quarter. The filing revealed that at the end of September, the fund added three new positions to its equity portfolio and sold out three positions. The top 10 portfolio holdings as of the end of the quarter represented 29.03%. The largest changes from previous 13-Fs fillings are in the energy and consumer discretionary sectors.


  • Value Investor Tom Russo Discusses The Power Of Brands

    Warren Buffett (Trades, Portfolio) makes big bets on companies that have large protective moats around their business. One of the very best types of moats is a bullet-proof brand that is entrenched globally.

    The perfect example is Coca-Cola (NYSE:KO) which Buffett made a huge investment in during the late 1980s and early '90s and still holds today.


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