- Warren Buffett Lunch Winner: I Won't Profit From Stock Tip Windfall
- Value of Warren Buffett's Annual Gift to Gates Foundation Falls Along With Berkshire's Stock
- After Warren Buffett 'Promoted' to Mattress Salesman, Nervous Nellie Sales 'Pretty Good'
- Warren Buffett Down, S&P Up, As First Half Buzzer Sounds
- Warren Buffett Wearing "Belt and Suspenders" As Tide Went Out - KBW Analyst
- Warren Buffett Charity Lunch Brings In Almost $1.7 Million From Anonymous Bidder
- Strong Bidding for Warren Buffett Lunch In Last Day of Charity Auction
- Warren Buffett Doesn't See Green Shoots: Download the Complete CNBC Transcript
- TRANSCRIPT: Warren Buffett's Live Lunch Interview on CNBC
- Warren Buffett: Apple Withheld "Material Fact" On Steve Jobs Health
RSS FEED
|
CNBC'S MOST SHARED
- A Goldman Trading Scandal?
- Rich People With A Death Wish
- Facebook Director Sees 'Billions' in Revenue in 5 Years
- The Threat of Ballooning Pensions
- Lehman CEO: Firm Deserved Bailout or 'Wind Down'
- Downturn Boosts Aruba's Business
- Latvian Banker Taking Souls as Collateral
- FedEx Sees Signs of a Turnaround: Report
- Market's Monday Blues
- Hey, What's Up Doc?
- March Lows Will Hold — So Buy Equities: Strategists
- Lacoste Runs Full Page Ad With Roddick Loss
- Brandt: Bing, The Little Search Engine That Couldn't
- 5-Star Manager's 5 Top Stocks
- Hey, What's Up Doc?
- Busch: Summertime Blues Hits Investors
- Chadwick: Recession and Scandals Pave the Way for Romney 2012
- Art Cashin: The S&P's 'Head and Shoulders' Number
- Michael Jackson: Death And Taxes
- Second Half: Wait For Pullbacks, Then Buy the Best
- Discover Shares Fall on Word of Stock Offering
- California General Obligation Bond Rating Cut
- GM to Get Final $20 Billlion From US This Year
- Goldman Sees No Harm From Computer Programmer
- World Trade Center Developer Threatens Arbitration
- The Weirdest Currencies on Earth
- Judge Gives Control of Jackson Estate to Executors
- Recession Special: Wine Cheaper Than Water!
Text Size 
 |
AP Oreo Cookies, one of Kraft Foods' strong brands, that presumably helped attracted Warren Buffett's buying interest in the company's stock |
Kraft Foods Current Price: [KFT
Loading...
()
]
Buffett's Kraft Foods stake also helped push other food stocks higher in what one portfolio manager calls a "bit of a halo effect" for the sector that often accompanies news of a Berkshire buy. Bullish forecasts and earnings from H.J. Heinz [HNZ
Loading...
()
], Hormel Foods [HRL
Loading...
()
] and Campbell Soup [CPB
Loading...
()
] also point to better pricing power for the industry, which has been hit by rising agricultural commodity costs.
Edward Jones analyst Matt Arnold tells Reuters that Kraft "is a company with leading, high-quality brands with depressed margins (that) offers significant value if management can restore profitability and drive the top line with product innovation."
Well-known and highly-respected brands, like Kraft's Oreo cookies and Oscar Mayer hot dogs are important to what Buffett calls a company's "durable competitive advantage", a key factor he looks for when buying into a business. (See, for example, his "crazy" 1988 bargain buy into Coca-Cola (now worth almost $12 billion) and his Gillette-generated holdings in Procter and Gamble (now worth about $7 billion.)
On CNBC's Squawk Box this morning, Buffett book author Andrew Kilpatrick of Wachovia Securities, noted that strong brand names "don't appear on a balance sheet" but are valuable nonetheless. Citigroup's Tobias Levkovich also found Buffett's recent interest in large-caps to be interesting.
Another big positive for Buffett is a strong, trustworthy management. Kraft Food spokesman says, "We're pleased with Buffett's vote of confidence... It signals he thinks we are doing the right thing." The company is in the middle of a multi-year turnaround plan under CEO Irene Rosenfeld. (Activist investor Nelson Peltz got some board members after he challenged Kraft's strategy last year.)
Berkshire Hathaway's Current Price: [US;BRK.A
Loading...
()
]
Questions? Comments? Email me at
Data is a real-time snapshot *Data is delayed at least 15 minutes