Over the course of his career, billionaire investor has been spectacularly successful in identifying brilliant shares. A lot of the focus has been on US shares as Buffett is well-known for his seemingly eternal bullishness on the long-term outlook for America. But the ‘Sage of Omaha’ has also dipped his toe in the London market from time to time.
By toe-dipping, I mean investing hundreds of millions of pounds! Buffett has the sort of cash at his disposal that small private investors like me can only dream of. Still, by looking at some of his UK investment decisions, I think I can learn some lessons (as, indeed, has Buffett). Tesco The biggest lesson is probably the investment in ( ).
Buffett has long experience with retail. Indeed, even as a boy he was a familiar presence in the Omaha general store his grandfather founded. Buffett later invested in a wide variety of retail-linked businesses, including the wholesale distributor McLane that he bought from .
At face value then, his Tesco move was classic Buffett. He stuck to a market he understood and in which there was likely to be resilient long-term demand. He opted for a company that had a proven business model.
Then, as now, it was by far the biggest grocery operator in the UK in terms of market share. Beginning in 2006, Buffett built a stake that led to his firm becoming Tesco’s third largest shareholder. He hung on despite a profit warning.
And another. And another. And another.
Buffett started offloading his Tesco .