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Halftime: Will Warren Buffett Buy Colgate?

After Warren Buffett told investors he is "hungry" to make acquisitions with Berkshire Hathaway's $38 billion in cash, famed strategist Douglas Kass predicts the stock sage will target a large consumer products company, like Colgate-Palmolive.

Being as Kass views the market as fragile, he thinks only a few sectors are going to hold on, including “staples and necessities.” That, he said, is something Buffett will factor into his next move.

“With Buffett looking for another target, I suspect a large consumer products company is on his menu,” Kass said on Wednesday's "Fast Money." "I wouldn't be surprised if he (buys) a company as large as Colgate-Palmolive ."

A Berkshire Hathaway shareholder, renown investor Whitney Tilson sees the situation a little differently. Buffett, he said, isn't likely to get the bargain price he desires.

"The stock market has doubled in the past two years," said Tilson, founder and managing partner of T2 Partners. "Blue chips are probably 20 percent undervalued, but they’re no longer 50 percent undervalued as they were."

In addition, Tilson said it's very rare in Buffett's history that he's taken a publicly-traded company private. There aren't that many examples, he said, aside from Clayton Homes, GEICO and Burlington Northern. In each case, Buffett saw extreme value.

"In the case of GEICO or Burlington Northern, he already owned a big slug of the stock and the whole company or the industry was depressed," Tilson explained. "So he was able to come in and buy it at a cheap price."



Considering Buffett has a large position in Procter & Gamble Tilson concedes Colgate is the kindof company Buffett would like, but he just doesn't see a deal going down given these circumstances.

As founder and managing partner of T2 Partners, Tilson is a highly regarded money manager on Wall Street. Kass has gained attention for his apparent read on the market. Less than a week before the S&P 500 hit a generational low of 676 on March 9, 2009, Kass went on CNBC and predicted the bottom. On July 6, 2010, he said the market had made its lows for the year, which also proved to be true.

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Trader disclosure: On Mar. 3, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Guy Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE) and (BTU). Steve Cortes owns (PM), (TM) and (EXC). Steve Cortes owns (SDY) vs. S&P. Steve Cortes owns Crude. Steve Cortes is short (F). Steve Cortes is short (C). Steve Cortes is short (DBA). Steve Cortes is short Wheat

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GUY ADAMI
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BRIAN KELLY
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DOUG KASS SOT
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