Warren Buffett

Warren Buffett

Last Update: 05-31-2017

Number of Stocks: 46
Number of New Stocks: 0

Total Value: $161,874 Mil
Q/Q Turnover: 7%

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

Warren Buffett Watch

  • The Art & Science of Successful Investing

    As I described in my book, "How I Managed $20,000,000,000.00 by Age 32," I believe successful investing is achieved by integrating aspects of both art and science. The science aspect of investing is fairly straightforward – most of the accounting and valuation math involved could be solved by a 7th grader. The more challenging aspect to successful investing is controlling the vacillating emotions of fear and greed when searching for attractive investments.


    When people ask me about my investment philosophy, I do not like to be pigeon-holed into one style box because normally my portfolios hold investments that outsiders would deem both value and growth oriented. Since I am an absolute return investor, I am more concerned about how I can maximize upside returns while minimizing downside risk for my investors.

      


  • Return on Assets: How to Find Banks That Generate Profits


    How do normal investors like you and I invest in a bank? According to Warren Buffett (Trades, Portfolio), the answer is pretty simple. Look to the bank’s return on assets or ROA.

      


  • Warren Buffett's Early Mistakes Teach Some Valuable Lessons

    For most investors, Warren Buffett (Trades, Portfolio) is a figurehead. The "Oracle of Omaha" can do no wrong, and every year thousands of Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B) shareholders make the pilgrimage to Omaha to hear him speak. Almost all beginner investors will come into contact with Buffett and his investing philosophy early in their careers, and his wisdom has shaped thousands of investors’ views of the market.


    With Buffett’s success consistently touted, it is difficult to believe he has ever made a mistake. Indeed, by looking at the constant stream of financial commentary on the Berkshire Hathaway chairman, you could be forgiven for thinking he has never put a foot wrong and everything he touches turns to gold.

      


  • Tracking Portfolio Performance With Risk Analysis

    The “Five Criteria for Good Companies” model portfolio generated solid returns during the backtesting period from January 2006-2017, outperforming the Standard & Poor’s 500 exchange-traded fund benchmark in nine of the past 12 years. As of June 20, the portfolio generated a cumulative return of 261.72%, yielding an average excess return of about 5.72%.


    Five criteria for good companies

      


  • The General Theory of Reverse Float

    During the most recent Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B) Annual Shareholders Meeting, Warren Buffett (Trades, Portfolio) and Charlie Munger (Trades, Portfolio) reiterated a point during the question and answer portion that has stuck with us. We feel compelled to share what we learned.


    Reverse float’s effect on EBITDA

      


  • The Death of Retail: The Signs Are Out There

    U.K. retailer Tesco PLC (LSE:TSCO) used to be the jewel in the country’s retail empire. The company was in almost every single town, village and city within the U.K. and a huge overseas presence. At its peak, the company accounted for more than a third of the U.K.’s total market and was the world’s third-largest supermarket group with stores in 12 countries. One British pound ($1.26) of every seven pounds spent in the U.K. went into Tesco’s tills at its peak.


    In 2013, however, the company started to unravel. Its market share began to fall, customers started going elsewhere and a number of the company’s overseas ventures were shut down. An accounting scandal followed, the dividend was cut, non-core businesses were sold and speculation of a rights issue to shore up the balance sheet swirled. By 2015, the company was on its knees and even Warren Buffett (Trades, Portfolio), who had bought into the business at its peak, decided to sell, calling one of his few mistakes.

      


  • Benjamin Graham as Described by His Students

    Benjamin Graham is the godfather of value investing, and his teachings form the basis of every value strategy used today.


    Here are some comments from former Graham students about their master, what they learned from Graham and how they’ve built his processes into their own investment strategies.

      


  • The Secret to Buffett's Success

    I think it is fair to say every investor, at some point in their career, has considered some get-rich-quick scheme or process designed to yield quick, impressive results from investing.


    There is no particular scheme I have in mind, but I am not just referring to Ponzi schemes and the like. Subscriptions to newsletters that promise returns of 20% per year or more, or even trading strategies based on technical indicators fall into this bracket.

      


  • Why Wealth Protection Is Important to Investors

    Many people and especially investors do not realize the importance of wealth protection until it is too late. And while most retail investors prefer to do their business under the radar of the public domain, at times it can prove too difficult to remain anonymously rich. People will eventually notice from your lifestyle and social interactions.


    This means that a wrong foot in the wrong place could land you in big trouble because, just like Robert Pagliarini points out in this Forbes article, “Lawsuits aren't filed against those with few assets; they are filed against those with deep pockets.”

      


  • Buffett's Deputies Weschler and Combs See Mostly Gains in First Half

    A great deal of Berkshire’s future rests on whether Buffett picks people as well as stocks. So far, he has seemed unflaggingly confident in the two he hired to eventually lead investing, Ted Weschler and Todd Combs. Their performance this year should also make Berkshire investors happy. Most of the stocks reportedly owned by the two have risen or soared above the S&P 500, including the airlines stocks Buffett said were “in large part” his decision.


    Todd Combs came to join Berkshire (NYSE:BRK.A)(NYSE:BRK.B) by asking Charlie Munger (Trades, Portfolio) for a meeting, which turned into breakfast, and then a meeting with Buffett, who hired him in 2010. From 2005-2010 Combs ran his own private investment fund, Castle Point Capital, and prior to that had gained experience in Buffett’s forte, insurance. Buffett first met Weschler when the hedge fund manager won dinner with him in a charity auction two years running. In 2011, Buffett hired him away from his successful $400 million hedge fund, Castle Point Advisors.

      


  • Dividends and Total Returns Add Up for Zeke Ashton

    Zeke Ashton (TradesPortfolio) may run a concentrated portfolio, just a couple of dozen stocks at most, but he finds it difficult to stay fully invested in this market.


    He wants to find above-average total returns and get them, likes to collect dividends and sometimes write covered calls. Above all, he searches for quality stocks in fields he understands well.

      


  • An Easy Way to Replicate Pabrai?

    As I have written several times before, Mohnish Pabrai (Trades, Portfolio) is one of my favorite value investors. There are many reasons why I like Pabrai’s approach. His returns speak for themselves, but Pabrai also approaches the market with a steady hand, long-term outlook and calm demeanor, something many other investors struggle to achieve.


    Pabrai’s gentle approach has helped him become one of the world’s most successful value investors. By concentrating on his returns, blocking out the rest of the market and taking a long-term focus, Pabrai has turned $100,000 invested in his leading fund at inception into $937,000 for year-end 2016 net of fees.

      


  • The Media: How to Deal With It

    We live in a time where gaining access to information has never been easier. Accessing data on a stock takes seconds, and we are constantly bombarded with news and information about market movements, investment ideas or political developments.


    In my view, none of this information is helpful. Sure, it always pays to be up to date on world events and broaden your horizons by reading. A constant barrage of market intelligence, however, is not helpful and is more likely to push you to make irrational decisions than sensible investment choices.

      


  • There Is Always an Excuse

    I read a few letters today; a few by Warren Buffett (Trades, Portfolio) and a few by a number of renowned value investors. In Buffett’s letters, I noticed a few times he candidly admitted he had made mistakes and analyzed why. In the other guru’s letters, I noticed plenty of excuses for underperformance and no attribution to themselves.


    It suddenly dawned on me that one of the most admirable yet most underappreciated qualities of Buffett and Charlie Munger (Trades, Portfolio) is they never seek excuses for their failures. In fact, it almost seems like they intentionally make every effort to trumpet them.

      


  • Pattern Energy: ‘Speed Bumps’ Create Modest Buying Opportunity

    (Published by Nick McCullum on June 13)


    The renewable energy sector has not historically been a source of satisfactory investment returns.

      


  • Procter & Gamble Needs Better Numbers to Return to Dividend Glory

    Procter & Gamble (NYSE:PG) has long been the darling of dividend investors, but many things have changed in the past five years. The company suffered massive setbacks as volumes continued to decline, and P&G decided to restructure itself, selling several brands while holding on to what it considered as products that had better growth prospects and better margins.


    And that brings us to a common error in judgment when it comes to dividend investing. One of the key factors that is always overlooked by dividend investors is the company’s ability to grow its revenue in the future, not just this year and the next but for this decade and many more decades if possible.

      


  • The Only Game in Town

    At the end of my freshman year in college (1977), my brother-in-law’s twin brother called me to ask if I wanted to go to the sixth game of the NBA Finals in Portland. I was a huge Trailblazer fan and was thrilled to sit in the top row of Memorial Coliseum, which held 12,665 fans.


    Not only was it an unbelievable experience for a lifelong fan (the Blazers won), but it was even more powerful because professional basketball was “the only game in town.” No other major professional sport (football, basketball, baseball) existed in Portland in 1977, and there is only one in town today.

      


  • Chuck Akre Buys Moody, Visa, Mastercard

    Chuck Akre (Trades, Portfolio) is the founder of Akre Capital Management LLC. He manages a portfolio composed of 31 stocks with a total value of $6.083 billion. During the first quarter the guru bought shares in the following stocks:


    The position of Moody's Corp. (MCO) was raised by 21.87% with an impact of 1.88% on the portfolio.

      


  • David Einhorn Sells Apple, Time Warner, FMC

    David Einhorn (Trades, Portfolio) is president of Greenlight Capital (a value-oriented investment adviser). He manages a portfolio composed of 37 stocks with a total value of $7.195 billion. During the first quarter the guru sold shares in the following stocks:


    The investor reduced his Apple Inc. (AAPL) position by 31.63% with an impact of -3.66% on the portfolio.

      


  • How Charlie Munger Made His First Million

    We have probably all heard the saying, “The first million is the hardest.” I have always been curious how the most successful businesspeople and investors made their first round of wealth. A few years back, Geoff Gannon wrote a very popular article titled “How Warren Buffett Made His First $100,000.” Lately, I have been reading the biography of Charlie Munger (Trades, Portfolio) by Janet Lowe, “Damn Right: Behind the Scenes with Berkshire Hathaway Billionaire Charlie Munger.” The book dedicated one full chapter to how Charlie Munger (Trades, Portfolio) made his first million.

    Charlie Munger (Trades, Portfolio) was always interested in money. “Like Warren, I had a considerable passion to get rich,” he once said, “not because I wanted Ferraris – I wanted the independence. I desperately wanted it.”  


  • Mohnish Pabrai's Wisdom

    This is the second part of a small series I’m doing on the wisdom of Mohnish Pabrai (Trades, Portfolio). In the last article, I covered Pabrai’s view on checklists and how they can help any investor streamline their process, reduce losses and improve overall investment performance. In this article, I’m going to take a look at Pabrai’s view on portfolio concentration and other portfolio management issues.


    The quotes below are taken from a discussion between Pabrai, Guy Spier and Michael Shearn at the ValueConferences Best Ideas January 2014 conference.

      


  • New Feature: Screening for Companies Using Historical Data

    Throughout the past five years, GuruFocus has added new features to the All-in-One Guru Screener, one of the most powerful value screeners on the web. We are pleased to announce the next addition to the Screener: screening for companies using historical data.


    Brief introduction to the Screener

      


  • Mr. Market: Who Is He and What Is He Doing Here?

    The parable of Mr. Market was first introduced in Benjamin Graham’s "The Intelligent Investor," and this idea that the market is an irrational businessman has been used to describe investor psychology and market movements ever since.


    Mr. Market and his irrationality is a key part of value investing because it teaches that prices are just arbitrary numbers. What’s more, this parable helps describe the margin of safety principle; investors should only buy a stake in the business where Mr. Market offers a wide enough margin of safety to intrinsic value.

      


  • The 2 Investment Principles Every Investor Should Understand

    If you know nothing about investing, entering the investment world for the first time can be a daunting prospect. There are thousands of websites out there offering information, opinions, educational courses and tools to help streamline your investment process, not to mention the hundreds of investment books you can buy offline. The world of investing is a daunting place, and as the availability of information continues to improve, it is only going to get more complicated.


    But I believe there is no need to overcomplicate any investment process. Sure, you can invest tens of thousands of dollars in a top trading platform, educational courses and hardware to improve your chances of beating the market. Although, as we’ve seen over the past few years, even the world’s best-funded hedge funds struggle to achieve market-beating returns year after year. It is much easier, and less stressful, to adopt a simple approach to investing.

      


  • The Power of the Model and the Rich Valuation – Part I

    Whenever I visit a company’s management team, I’d ask the following two questions, which I learned from Warren Buffett (Trades, Portfolio):


    1. You have to put 50% of your net worth in a company in your industry, and it can’t be your own company. You have to hold it for 10 years without looking at it. Which company would it be and why?
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  • A Deep Analysis of 6 Five-Star Companies

    Among U.S. companies, six have maintained a GuruFocus Business Predictability Rank of five stars year over year since June 2012: Jack Henry & Associates Inc. (NASDAQ:JKHY), Mednax Inc. (NYSE:MD), Mesa Laboratories Inc. (NASDAQ:MLAB), Rollins Inc. (NYSE:ROL), Tyler Technologies Inc. (NYSE:TYL) and World Acceptance Corp. (NASDAQ:WRLD).


    Brief introduction of Predictability Rank

      


  • Gurus Seek Value in Technology Companies

    The Top 25 Historical Low Price-Sales model portfolio outperformed the Standard & Poor’s 500 index in four of the past six years. As of June 1, the portfolio had a cumulative gain of 125.73% since its inception on Dec. 30, 2009. Three technology companies, Baidu Inc. (NASDAQ:BIDU), Infosys Ltd. (NYSE:INFY) and Qualcomm Inc. (NASDAQ:QCOM), have generated positive returns to the model portfolio over the past two years. Several gurus have increased their positions as these companies offer good value potential.


    Baidu

      


  • Buffett and Lanxess: What’s the Deal?

    The “Icahn Lift” is a term given to the rise in stock price that occurs when Carl Icahn (Trades, Portfolio) begins to purchase shares in a company. Thanks to his fearsome reputation for unlocking shareholder value and not resting until management has been kicked into action, investors follow Icahn into stocks hoping to piggyback off his actions and profit from the resulting unlocked value.


    The same effect is also seen when Warren Buffett (Trades, Portfolio), owner and CEO of Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B), buys into a stock. No matter how large or small the position, when Buffett buys, it is a huge vote of confidence in the business because he tends to spend years researching a position before making a move.

      


  • Don't Buy Costco Stock Right Now

    One of Charlie Munger (Trades, Portfolio)’s favorite stocks, Costco (NASDAQ:COST) will continue to grow its business and brand, but the stock is more than likely dead money at this valuation.




  • Buffett Deploys Cash in Deutschland

    Warren Buffett (Trades, Portfolio)’s Berkshire Hathaway (NYSE:BRK.A)(NYSE:BRK.B) disclosed a stake in Germany’s Lanxess AG (FRA:LXS) on May 19, worth roughly $179.85 million on the date of filing, a small fraction of his $96.5 billion cash hoard.


    Buffett bought 2,749,582 shares of Lanxess, a chemicals company, representing a 3.004% stake. The value of the holding ranks it as one of his smaller positions, and makes it only his second foreign company to reach the size threshold for reporting to regulators, along with Sanofi (XPAR:SAN). Shares of Lanxess jumped 8.3% in Frankfurt trading yesterday when Reuters and Bloomberg first reported the buy. On Tuesday, the stock slid 0.79% on the German exchange to 67.91 euro, or $75.89, per share.

      


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