Warren Buffett Fans Should Consider This ‘Low-Profile’ Fund That Mimics Berkshire Hathaway

Berkshire Hathaway Shareholders, Omaha, USA - 03 May 2019
Nati Harnik / AP / Shutterstock.com

If you’re a fan of Berkshire Hathaway and the Oracle of Omaha’s investment style, you might want to invest in this fund. Graham Holdings “amounts to a small-scale version of Buffett’s Berkshire Hathaway, with a large group of unrelated businesses and a strong balance sheet,” according to Barron’s.

See: 10 Best Companies To Invest In for 2022
Find Out: How Much Is Berkshire Hathaway Worth?

While the name might not sound familiar, it was previously The Washington Post Company before changing its name to Graham Holdings Company as a result of the sale of The Washington Post newspaper to Jeff Bezos on November 18, 2013.

“You don’t get more low-profile than Graham Holdings,” said Craig Huber of Huber Research Partners, one of the few analysts following the stock, citing the company’s lack of quarterly conference calls and limited investor-relations efforts, Barron’s reported.

But that might be a missed opportunity, because the thinly traded stock, at around $590, looks cheap relative to the estimated value of the company’s assets, Barron’s added.

Related: How To Create the Best Investment Plan for You in 2022

The company’s assets include the Kaplan education business, manufacturing and healthcare groups, three car dealerships, online magazine Slate, as well as the Foreign Policy Group, CyberVista, a cybersecurity training and workforce development company, and several local TV stations, according to its website.

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It also includes a restaurant group, including the historic Old Ebbitt Grill, which was the highest-grossing eatery in the capital before the pandemic, according to Barron’s.

“What Graham is trying to do is recreate a small Berkshire Hathaway and leave the management teams in place to run the businesses,” Huber told Barron’s. “Investors get frustrated because they don’t understand how it all fits together.” The analyst has an Overweight rating and a $730 price target on the stock, Barron’s added.

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The company trades well below its book value of about $800 a share, which are up about 10% this year, but are unchanged since the spring of 2017, Barron’s noted. In addition, the company’s earnings are expected to rise 33% in 2022, to $48.25 a share, helped by increased political advertising at the TV stations and lower losses at some of Kaplan’s international businesses.

There’s another fund that has been mimicking and even outperforming Warren Buffett’s Berkshire Hathaway for years, and if you haven’t heard about it, you might want to take notice, as GOBankingRates previously reported. Indeed, several investment analysts say it’s set to continue to soar in 2022. Central Securities Corp., which trades on the New York Stock Exchange under the ticker “CET,” has operated as a closed-end investment company with the primary objective of growth of capital since October 1, 1929.

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The fund, with $1.3 billion in assets, has outperformed the Oracle of Omaha’s fund over the past 20 years. Over the past 25, 30, 40 and even nearly 50 years, it has beaten the S&P 500, according to The Wall Street Journal.

Explore: 20 Companies You Didn’t Know Warren Buffett’s Berkshire Hathaway Owns
Learn: 11 Ways Warren Buffett Lives Frugally

The fund’s CEO, 89-year-old Wilmot H. Kidd III, shares some of Buffett’s steadfast mottos of holding steady and being patient as being key to investing.

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About the Author

Yaël Bizouati-Kennedy is a former full-time financial journalist and has written for several publications, including Dow Jones, The Financial Times Group, Bloomberg and Business Insider. She also worked as a vice president/senior content writer for major NYC-based financial companies, including New York Life and MSCI. Yaël is now freelancing and most recently, she co-authored  the book “Blockchain for Medical Research: Accelerating Trust in Healthcare,” with Dr. Sean Manion. (CRC Press, April 2020) She holds two master’s degrees, including one in Journalism from New York University and one in Russian Studies from Université Toulouse-Jean Jaurès, France.

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