When Warren Buffett makes any move, the world pays attention. Even though the billionaire’s investments haven’t always been successful, they have been well-thought-out and many have been massive successes.
Buffett, who turns 90 this year, hasn’t used magic to become one of the most successful traders in the world, but instead used principles that any investor can learn and apply. This is what makes the “Oracle from Omah” well respected by the investment community.
Recently Buffett made a big move through his Berkshire Hathaway conglomerate by investing a huge amount in Kroger Co., a supermarket stock.
Kroger, is an American retail company founded by Bernard Kroger in 1883 in Cincinnati, Ohio. It is the largest supermarket by revenue in the U.S. and the second-largest general retailer.
Berkshire bought a new position of 18.9 million shares of Kroger (NYSE: KR) during the fourth quarter, according to a Securities and Exchange Commission filing. Berkshire Hathaway on Feb. 14 filed a 13F form with the Securities and Exchange Commission reporting the purchase of more than 18.9 million shares in Kroger for $549.1 million.
The stake at year-end and represents 2.4% of Kroger’s stock, making Berkshire the seventh largest owner of the company, according to Kroger’s investor relations listing on its website.
Buffett has seen returns of 20.5% over the 54 years he has been Berkshire Hathaway’s CEO, which is nearly double the stock market’s gains. It will be interesting to see where this newest investment goes.
“Obviously, it’s a big vote of confidence in Kroger, the management team and its strategy,” remarked analyst Rupesh Parikh of Oppenheimer & Co. “We don’t know if it’s Warren Buffett or some of the other portfolio managers that made this investment. But it’s a clear positive to have Warren Buffett involved, and it definitely helps the stock from a support perspective.”