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Buffett's Final Act: The Growth Stock Surprise
12 Dec
Summary
- Warren Buffett, value investing legend, retired after 60 years as CEO.
- His final act as CEO included a $4.3 billion investment in Alphabet.
- This marked a significant shift from his traditional aversion to tech stocks.
Warren Buffett, renowned as the greatest value investor, has concluded his 60-year tenure as CEO of Berkshire Hathaway, handing leadership to Greg Abel. In a move that surprised many, Buffett's final significant transaction involved purchasing 17.85 million shares of Alphabet, Google's parent company, valued at $4.3 billion. This decision marks a notable departure from his historical reluctance to invest in technology firms.
Buffett's investment philosophy, initially built on acquiring undervalued stocks, evolved over decades, notably with guidance from his late partner Charlie Munger. Munger encouraged a focus on higher-quality companies, a strategy reflected in Berkshire's investments in American Express, Coca-Cola, and Apple. The recent Alphabet investment can be seen as a posthumous nod to Munger's influence, particularly after discussions about Google's advertising model.
Despite Berkshire's remarkable 60-year annualized return of approximately 20%, double the S&P 500, without significant technology holdings, Buffett's openness to change is evident. His advice to shareholders emphasizes learning from past mistakes and adapting one's thinking, suggesting that it is never too late to improve. This final investment in a leading tech company serves as a powerful metaphor for Buffett's own investor growth and his enduring partnership with Munger.
