Warren Buffett Is Throwing Money at This Company Before He Retires — Should You Do the Same?
Written by
Andrew Lisa
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Levi Leidy
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Warren Buffett‘s decades-long reign as the country’s premier investing guru is sunsetting, but Berkshire Hathaway’s SEC filings show that the Oracle of Omaha has made some surprising portfolio moves as his impending 2025 retirement draws near.
With opportunities to follow the lead of history’s most successful value investor dwindling, should you take advantage of what might be your last chance to parrot Warren Buffett’s trades?
Buffett Dumps Several Key Holdings
Berkshire Hathaway’s most recent 13F filing revealed that Buffett completely exited his position in two stocks and thinned another by nearly half:
- Formula One (FWONK): -48%
- Citigroup (C): -100%
- Nu Holdings (NU): -100%
While dramatic, the Formula One halving didn’t make as many waves as Buffett’s complete offloading of Citigroup and Nu. His decision to abandon Citigroup altogether is interesting because, despite Buffett being a die-hard advocate for long-term, buy-and-hold investing, he first purchased the stock only in 2022. However, his relatively short time in the position paid off in spades — Citigroup gained about 41% during its short stint in the Berkshire portfolio.
His dumping of NU is noteworthy because, according to Fortune, the Latin American bank exposed Buffett — a passionate crypto skeptic — to Bitcoin, which the Oracle once derided as “rat poison.”
The Sales Freed Up Cash To Bulk Up on Some Existing Positions
Buffett didn’t add any new holdings to Berkshire’s portfolio, but he did grow several existing positions. Most notably, he more than doubled up on:
- Constellation Brands (STZ): +114%
- Pool Corporation (POOL): +145%
According to Entrepreneur, Buffett’s affection for Constellation is par for the Buffett course, as it checks many of the value investor’s long-standing boxes — long-term growth potential, strong fundamentals and a reliable customer base.
However, it was Buffett’s choice to increase his POOL holdings by a multiplier of nearly one and a half that grabbed the most headlines.
Buffett Is Sweet on POOL — Should You Be, Too?
Pool Corp. is the world’s largest wholesaler of swimming pool products, and Buffett’s growing affection for the company is making a splash — and it’s easy to see why.
Had you invested in POOL when it went public in 1995, you would have enjoyed returns of more than 33,400%. While off from its December 2021 high of $563 (it’s trading at around $309 as of June 4), Buffett is, as always, looking forward to its future potential, not back to its past performance.
While only you and your investment advisor know if POOL is a good match for your portfolio, The Value Investor writes that the company is a perfect match for Buffett’s investment philosophy because it:
- Is an industry leader with a dominant market position
- Has consistently strong cash flow
- Regularly reports high revenue and solid margins, and maintains overall attractive financials
- Has a resilient business model
- Is strategically and consistently growing, expanding, investing in technology and acquiring subsidiaries
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