Even Warren Buffett shops at Wal-Mart

Berkshire Hathaway's 13-F filing shows that Warren Buffett loaded up on Wal-Mart stock. What does the Oracle of Omaha know?

By InvestorPlace Nov 17, 2009 6:25PM
By Jim Woods

wal-mart logoI knew he was frugal, but does the second-richest man in America really need to shop at  Wal-Mart (WMT)?

Well, when your cart can accommodate 37.8 million WMT shares, I can begin to understand Buffett’s need to do a little bargain shopping.

  Is Buffett Playing It Safe with Wal-Mart?

And Buffett has been really loading up his cart. That 37.8 million shares as of September 30, 2009 is a big increase from the 19.9 million shares Buffett’s firm Berkshire Hathaway (BRK-A) owned last quarter. 

The increase in Buffett’s WMT holdings is telling, as it indicates that he sees value in the retail giant for the long term. Buffett is known for finding value and sticking with that value until it makes him huge profits. 

Now, I’ve written a lot in the past about how I love Wal-Mart, not simply because it's a great company with a solid stock outlook, but because I think Wal-Mart is a "paragon of virtue” that creates a tremendous amount of jobs -- more jobs than any silly federal stimulus program could ever hope to create. Wal-Mart’s virtue also comes from the fact that the company saves American families thousands of dollars each year due to their low-priced merchandise.

I’ve also written about how individual investors shouldn’t necessarily follow Warren Buffett’s picks, as the "Oracle of Omaha" has a lot more time and capital to wait-out a downturn than the average investor trying to pump up his or her retirement account.

This time, however, I think Buffett’s additional WMT purchases should be read as a buy recommendation for individual investors. The fact is Wal-Mart is an extremely well-run company, and it continues to sell a whole lot of merchandise, while also managing to streamline costs. 

And though the company gave a not-so-cheery holiday sales forecast, that forecast has much more to do with current economic conditions than internal problems at Wal-Mart stores.

I think the news that Buffett is bullish on WMT is great news, not only for Wal-Mart-lovers like me, but for investors who want to own a great company that will likely continue delivering profits to shareholders for many years to come.

NOTE: At the time of this writing, Jim Woods did not own WMT shares.

Related Articles:

Please help us to maintain a healthy and vibrant community by reporting any illegal or inappropriate behavior. If you believe a message violates theCode of Conductplease use this form to notify the moderators. They will investigate your report and take appropriate action. If necessary, they report all illegal activity to the proper authorities.
100 character limit
Are you sure you want to delete this comment?


Copyright © 2014 Microsoft. All rights reserved.

Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.


StockScouter rates stocks from 1 to 10, with 10 being the best, using a system of advanced mathematics to determine a stock's expected risk and return. Ratings are displayed on a bell curve, meaning there will be fewer ratings of 1 and 10 and far more of 4 through 7.

125 rated 1
267 rated 2
455 rated 3
612 rated 4
682 rated 5
695 rated 6
632 rated 7
472 rated 8
279 rated 9
147 rated 10

Top Picks

TAT&T Inc9



Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.

Contributors include professional investors and journalists affiliated with MSN Money.

Follow us on Twitter @topstocksmsn.