Strategist: Invest Like Buffett—With Garbage!
Billionaire investor Warren Buffett has been adding to his position in waste-management firm Republic Services this past quarter. Should investors follow Buffett and bank on the trash-disposal stocks? James Altucher, managing director at Formula Capital, shared his insights.
“Buffett is not a value investor—he has been a demographics investor,” Altucher told CNBC.
“So if he thinks everyone in the world is going to shave with disposable razors, he buys Gillette; if he thinks everyone is going to use their credit cards, he buys American Express.”
Altucher said both Warren Buffett and fellow billionaire Bill Gates are the largest shareholders of Republic Services .
“We’re going to [create] hundreds of millions of [pounds of] trash a year this year,” he explained.
“Knowing that, Gates owns Waste Management as well. These guys have been buying up all the garbage stocks.”
Altucher said he favors the smaller waste management companies such as Stericycle and American Ecology.
- Watch Altucher's Previous Appearance on CNBC (Feb. 12, 2010)
More Market Intelligence:
- Bank Stocks Look 'Amazing' Long-Term: Strategist
- Economy Is 'Healing Itself'—Buy Banks: Chief Investor
- Read: The Warren Buffett Blog
CNBC Data Pages:
Altucher does not own shares of RSG, IRM or WM.