Canaccord Genuity Morning Coffee on Warren Buffett: Buy European. I Am?
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Rating Summary:
4 Buy, 5 Hold, 1 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 6 | New: 26
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Canaccord Genuity Morning Coffee on Warren Buffett: Buy European. I Am?
In the market's darkest hours over the past three years, timely insights from Warren Buffett always seem to calm rattled investors. Buffett penned an op-ed piece for The New York Times in 2008 entitled "Buy American. I Am." – we've referred to this op-ed piece a million times in the Morning Coffee. Buffett's insights are timeless; a simple rule dictates his buying: "Be fearful when others are greedy, and be greedy when others are fearful. And most certainly, fear is now widespread, gripping even seasoned investors. To be sure, investors are right to be wary of highly leveraged entities or businesses in weak competitive positions. But fears regarding the long-term prosperity of the nation’s many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records five, ten and 20 years from now. Let me be clear on one point: I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month - or a year - from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over." True, Buffett was referring to American companies. Would he say the same thing today about European companies? Last month, Buffett said he had begun seeing some real bargains in Europe. According to Buffett, "I can think of a dozen European stocks that are quite attractive. Whether they're more attractive than something else I can find in the United States depends on the prices on any given day, or any given week. But there are European stocks I like and there's some wonderful businesses in Europe and the prices have come down on some of them." Earlier this year, Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) increased its stake in Tesco, U.K.-based supermarket chain, to 3.6%.
In the market's darkest hours over the past three years, timely insights from Warren Buffett always seem to calm rattled investors. Buffett penned an op-ed piece for The New York Times in 2008 entitled "Buy American. I Am." – we've referred to this op-ed piece a million times in the Morning Coffee. Buffett's insights are timeless; a simple rule dictates his buying: "Be fearful when others are greedy, and be greedy when others are fearful. And most certainly, fear is now widespread, gripping even seasoned investors. To be sure, investors are right to be wary of highly leveraged entities or businesses in weak competitive positions. But fears regarding the long-term prosperity of the nation’s many sound companies make no sense. These businesses will indeed suffer earnings hiccups, as they always have. But most major companies will be setting new profit records five, ten and 20 years from now. Let me be clear on one point: I can’t predict the short-term movements of the stock market. I haven’t the faintest idea as to whether stocks will be higher or lower a month - or a year - from now. What is likely, however, is that the market will move higher, perhaps substantially so, well before either sentiment or the economy turns up. So if you wait for the robins, spring will be over." True, Buffett was referring to American companies. Would he say the same thing today about European companies? Last month, Buffett said he had begun seeing some real bargains in Europe. According to Buffett, "I can think of a dozen European stocks that are quite attractive. Whether they're more attractive than something else I can find in the United States depends on the prices on any given day, or any given week. But there are European stocks I like and there's some wonderful businesses in Europe and the prices have come down on some of them." Earlier this year, Berkshire Hathaway (NYSE: BRK-A) (NYSE: BRK-B) increased its stake in Tesco, U.K.-based supermarket chain, to 3.6%.
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