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Investing Warren Buffett Watch

  Monday, 14 Nov 2011 | 1:42 PM ET

Warren Buffett Still a Shrewd Investor: Tilson

Posted ByMichelle Fox

Warren Buffett's recent investment in IBM proves he's still a shrewd investor, hedge fund manager Whitney Tilson told the "Fast Money" team Monday.

“It's remarkable to see an 81-year-old guy continually expanding his circle of competence,” he said. “He’s putting large chunks of money to work in very nimble and clever ways.”

Warren Buffett revealed his $10.7 billion purchase ofIBM common stock earlier Monday on CNBC.

While Tilson was initially surprised by the move, he said after looking at IBM , it now makes sense.

“It’s a globally diversified business that is called a tech company,” Tilson added, “but it really probably has the lowest level of technology risk you can think of in the tech sector in the sense that only eight percent of their net earning are from hardware. “

Plus, he said, IBM has been an incredibly stable cash-producing business and a solid performer for the past two decades.

Tilson said by investing in IBM, Buffett wasn’t looking for a cheap stock that would double his money quickly.

“Rather, [Buffett’s] putting a huge amount of money to work in something that is going to crank out very nice returns for a long period of time with a high degree of certainty,” he said. “That’s what he’s looking for when he’s absolutely drowning in cash. He’s got $64 billion in cash and bonds earning nothing right now.”

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  Monday, 14 Nov 2011 | 1:33 PM ET

CNBC Transcript: Warren Buffett Explains Why He Bought $10.7B of IBM Stock (Part 5)

Posted ByAlex Crippen
Warren Buffet & Becky Quick
CNBC
Warren Buffet & Becky Quick

This is part five of an unofficial transcript of Warren Buffett's three-hour long live appearance on CNBC's Squawk Box this morning, Monday, November 14, 2011. (Click here for part four.)

Buffett revealed that Berkshire Hathaway has bought almost $11 billion worth of IBM common stock this year. He also said it is "not clear" that Europe has the will or ability to do "whatever is necessary" to fix its debt problems.

In this section, Buffett reveals that "Harold" refers to IBM, and tells us Berkshire Hathaway has bought almost $11 billion of IBM common stock this year.

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  Monday, 14 Nov 2011 | 1:09 PM ET

CNBC Transcript: Warren Buffett on Occupy Wall Street and the 'Harold' Hint (Part 4)

Posted ByAlex Crippen
111114_Buffett-Becky.jpg

This is part four of an unofficial transcript of Warren Buffett's three-hour long live appearance on CNBC's Squawk Box this morning, Monday, November 14, 2011. \(Click here for part three.\)

Buffett revealed that Berkshire Hathaway has bought almost $11 billion worth of IBM common stock this year. He also said it is "not clear " that Europe has the will or ability to do "whatever is necessary" to fix its debt problems.

In this section, Buffett says the Occupy Wall Street movement doesn't have clear enough goals to spark real change and he drops a mysterious hint on what he's been buying: "Harold."

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  Monday, 14 Nov 2011 | 12:49 PM ET

CNBC Transcript: Warren Buffett on MF Global and Excessive Risks (Part 3)

Posted ByAlex Crippen
111114_Buffett-Solo.jpg

This is part three of an unofficial transcript of Warren Buffett's three-hour long live appearance on CNBC's Squawk Box this morning, Monday, November 14, 2011. \(Click here for part two.\)

Buffett revealed that Berkshire Hathaway has bought almost $11 billion worth of IBM common stock this year. He also said it is "not clear " that Europe has the will or ability to do "whatever is necessary" to fix its debt problems.

In this section, Buffett discusses the MF Global situation. He also speaks more generally about what should happen to CEOs who take big risks that fail, requiring government intervention.

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  Monday, 14 Nov 2011 | 11:58 AM ET

CNBC Transcript: Warren Buffett Calls Romney the Strongest GOP Candidate (Part 2)

Posted ByAlex Crippen
111114_Buffett-Becky.jpg

This is part two of an unofficial transcript of Warren Buffett's three-hour long live appearance on CNBC's Squawk Box this morning, Monday, November 14, 2011. \(Click here for part one.\)

Buffett revealed that Berkshire Hathaway has bought almost $11 billion worth of IBM common stock this year. He also said it is "not clear " that Europe has the will or ability to do "whatever is necessary" to fix its debt problems.

In this section, Buffett talks about the possibility of more quantitative easing by the Federal Reserve and says GOP presidential candidate Mitt Romney has the best chance of beating President Barack Obama in the 2012 election.

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  Monday, 14 Nov 2011 | 11:17 AM ET

CNBC Transcript: Warren Buffett on Europe and U.S. Housing 'Depression' (Part 1)

Posted ByAlex Crippen
Warren Buffet & Becky Quick
CNBC
Warren Buffet & Becky Quick

This is part one of an unofficial transcript of Warren Buffett's three-hour long live appearance on CNBC's Squawk Box this morning, Monday, November 14, 2011.

Buffett revealed that Berkshire Hathaway has bought almost $11 billion worth of IBM common stock this year. He also said it is "not clear " that Europe has the will or ability to do "whatever is necessary" to fix its debt problems.

In this section, Buffett speaks extensively about Europe and also talks about a 'depression' for Berkshire companies related to the still-struggling U.S. housing market.

JOE KERNEN: Good morning. The "full Monti." Mario Monti takes over the Italian government after Silvio Berlusconi leaves to a chorus of hallelujah. Boeing lands one of the biggest deals in aviation history. And legendary investor Warren Buffett joins us live for the next three hours to tackle Europe, the markets, and the Super Committee. It's Monday, November 14th, 2011. SQUAWK BOX begins right now.

***

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  Monday, 14 Nov 2011 | 7:27 AM ET

What Has Warren Buffett Been Buying? 'Harold'

Posted ByAlex Crippen
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Warren Buffett's Berkshire Hathaway releases its end-of-Q3 stock portfolio snapshot later today, but during his live appearance on Squawk Box this morning Buffett revealed its big secret: Berkshire has bought $10.7 billion worth of common stock in IBM , or 64 million shares at an average price of $170.

The stock is trading around $189 this morning, giving Berkshire a gain of more than 11 percent.

Most of the IBM buying was done in this year's second and third quarters.

Buffett also revealed he didn't do much selling of stocks in the third quarter.

Buffett's company now owns 5.4 percent of IBM but he doesn't intend to buy any more. "I wouldn't be talking about it if I did." Even so, he could resume buying if IBM's stock price goes down enough and Berkshire has enough money coming in.

Buffett says he started accumulating IBM shares in March with the goal to buy $10 billion worth of stock.

We've noted that Berkshire's 13-F filings for the first and second quarters said that some holdings were being kept confidential , and it appears this is the buying spree Buffett was keeping under wraps. (He doesn't want copycat buyers to drive up the price of a stock he's actively acquiring.)

Buffett says he has not talked to the company or current CEO Sam Palmisano about his purchases, but he thinks IBM has done an "incredible job" executing its long-term strategy, has an excellent "road map" for the future, and "respects" its shareholders by being honest with them and doing big stock buybacks. "They've done all kinds of things right."

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  Monday, 14 Nov 2011 | 6:18 AM ET

Warren Buffett on CNBC: 'Not Clear' Europe Has Will or Ability to Resolve Crisis

Posted ByAlex Crippen
Warren Buffett
Getty Images
Warren Buffett

Warren Buffett says it's not clear Europe has the will or ability to do "whatever it takes" to resolve its debt crisis .

He thinks we're seeing a partial run on Europe and he's concerned about lack of confidence in the continent.

Appearing live on CNBC's Squawk Box this morning, Buffett says he looks at European sovereign debt every day but has not gotten back into it. He also tells Becky Quick that Berkshire Hathaway does not own stocks in Eurozone banks and hasn't yet seen any opportunities to buy. He would need to understand them better, he says, before investing.

Buffett says Europe is "not going away" and its economy will be stronger in ten years. But he warns that getting from here to there may be difficult.

Buffett has been doing some big buying in the United States. He revealed that Berkshire has bought $10.7 billion worth of IBM common stock this year.

In the United States, Buffett thinks parts of the economy are doing very well, but the housing market still hasn't turned around, despite his earlier prediction that it would by now. He says Berkshire's housing-related companies are in a "depression" with no evidence of improvement coming.

The housing market doesn't need stimulus, says Buffett. It needs the creation of more households than housing units, and that process is underway. "Hormones still kick in, and we'll still form households."

Outside the housing market, Buffett points out that many businesses are generating strong profits.

He would not pull the trigger on another quantitative easing by the Federal Reserve, but he's not worried about how the market would react if the Fed does go ahead.

On the race for the White House, Buffett says Mitt Romney would be the strongest GOP candidate to run against President Barack Obama and is most likely to win his party's nomination. Asked which GOP candidate he would support if he couldn't back a Democrat, Buffett says it would be Romney, although "that could be the kiss of death."

While he does not want to see Texas Governor Rick Perry become president, it's not due to Perry's forgetfulness during last week's CNBC debate .

Buffett again

Current Berkshire stock prices:

Class B:

Class A:

For more Buffett Watch updates follow alexcrippen on Twitter .

Email comments to buffettwatch@cnbc.com

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  Monday, 7 Nov 2011 | 1:39 PM ET

Warren Buffett's Berkshire Was Buying as Stock Prices Fell

Posted ByAlex Crippen
Warren Buffett
Getty Images
Warren Buffett

One of Warren Buffett's favorite rules of investing is that the lower prices get, the more he's likely to buy.

We now have another indication Berkshire Hathaway was indeed doing more buying as stock prices plunged in the third quarter.

According to Bloomberg's analysis , the latest quarterly SEC filing from Berkshire shows the company investing $23.9 billion in the quarter, the most in at least 15 years.

Bloomberg says that includes almost $7 billion in equity securities, up from $3.61 billion in Q2 and just $834 million in the first quarter.

Bloomberg notes that in mid-August Buffett told Charlie Rose that Berkshire had spent more on stocks on August 8 than any other day this year. That's the day stocks fell more than 6 percent in the wake of Standard & Poor's decision to downgrade the U.S. government's credit rating from AAA.

In a live interview on CNBC on September 30, Buffett told Andrew Ross Sorkin:

"We've bought, in the last quarter, the third— in the current quarter, we bought net 4 billion of common equities, which was similar to the total amount we bought in the first half. The cheaper stocks get, the better I like to buy them, whether it's our stock or somebody else's."

We'll get some more precise numbers a week from today, when Berkshire releases its end-of-Q3 "snapshot" of its portfolio of U.S. publicly traded equities.

And remember that for the previous two quarterly reports, Berkshire has received the SEC's permission to keep some of its holdings confidential, which could be a sign it's been building a position or positions and wanted to keep copycat buyers away for awhile.

Current Berkshire stock prices:

Class B:

Class A:

For more Buffett Watch updates follow alexcrippen on Twitter .

Email comments to buffettwatch@cnbc.com

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  Friday, 4 Nov 2011 | 5:52 PM ET

Berkshire Hathaway Operating Earnings Rise 37%

Posted ByAlex Crippen
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Operating earnings at Warren Buffett's Berkshire Hathaway increased by 36.8 percent to $3.81 billion in the third quarter.

A reported "loss" of $1.59 billion for Berkshire's derivatives positions, however, contributed to a 23.8 percent drop to $2.29 billion for the company's net earnings.

Buffett has often urged investors not to pay too much attention to net earnings, because they can swing wildly based on the current value of derivatives positions that the company will be holding for years to come.

Berkshire's book value, a favorite Buffett metric, increased by 1.5 percent from the end of 2010 to reach $96,876 per Class A equivalent share as of September 30.

The company's recent stock buyback program sets an upper limit of 110 percent of book value for any repurchases.

At today's close of $115,806, the stock is 119 percent above the September 30 book value.

More detailed information is included in the company's 10-Q filing with the SEC.

Current Berkshire stock prices:

Class B:

Class A:

For more Buffett Watch updates follow alexcrippen on Twitter .

Email comments to buffettwatch@cnbc.com

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About Buffett Watch

  • Warren Buffett is arguably America’s most-admired and most-followed investor. Buffett is the largest shareholder and CEO of Berkshire Hathaway and one of the world’s most famous and most generous philanthropists. Legions of investors - from all walks of life - follow Buffett's homespun investment philosophy: invest in what you know, invest in value. Here on CNBC.com's Warren Buffett Watch, we’ll keep you up to date on what the “Oracle of Omaha” is doing by following Buffett's trades, words and deeds.