Sunday, April 28, 2013
Warren Buffett checks in on his Coke investment
This is an article from The USA Today - interesting read on Buffet and his love for Coca-Cola. Seeing the volatility of so many of today's tech stocks, Buffet reminds investors at the annual shareholders meeting why coke makes sense (In fact, Berkshire's stake in Coke is second only to Buffett's position in Wells Fargo (WFC) stock. And the investment has been profitable for Buffett and other investors. Shares of the company have jumped 16.8% year-to-date, and more than 57% the past three years). He explains how it is important to invest in a company that you know will be there in the future. As a matter of fact, staple companies such as Coca-Cola, P & G, and GE have always experienced great financial support from Buffet.
Additionally, Buffet seems to give his best shot of injecting some consumer confidence into our economy. "In my life time, since 1930, real GDP per capita in the United States has gone up 6-to-1. We have not lost the secret sauce. (And) that's the kind of future I see ahead ... (it's why) you want to own businesses that are going to participate in that future."
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Buffett has always been an investor who invests only in the things he can understand. This is the leading reason he has walked away from many tech stocks. Coca-Cola is a very stable brand that will hold strong through any kind of market. What is interesting was Buffetts plan to buy around 750,000 shares of IBM last spring. Maybe we are seeing a new mindset in the great investor. Who knows? As for know what he is doing has obviously worked for him.
ReplyDeleteIt is good that there is some positive feedback into the market showing that not all companies are bad or not doing what they are supposed to do. This announcement should give hope to investors and allow them to continue supporting and adding confidence to the market, especially since the market continues to fluctuate.
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