Even when press turns negative or the markets drop, Warren Buffett doesn't dump his holdings in a company. "The stock market is not there to instruct me, it's there to serve me," Buffett told CNBC's Becky Quick during an interview on "Squawk Box" on Monday.
The topic arose when Quick asked Buffett a viewer's question about Kraft Heinz. A few days before their conversation, Kraft Heinz, one of Berkshire Hathaway's largest holdings, had missed on its earnings expectations and disclosed that it had received a subpoena from the SEC. After that news broke, the company's stock plunged 30 percent and Berkshire Hathaway's stake dropped in value by more than $4 billion.
But although Buffett has admitted that "we overpaid for Kraft," he told Quick he has no plans to sell his stake in the company. His practice is to keep his focus on, and evaluate, the company overall. "If there's bad news and the stock goes down, the question I have is: Is the long-term valuation changed?" he says.
It's possible to recover from a setback. The key thing, Buffett says, is "you gotta make sure that it's still a fundamentally good business."