To get a sense of scale for how big Amazon.com is, the $900 million stake in Amazon’s stock only puts Berkshire Hathaway in control of 0.1% of the e-commerce giant’s retail empire.
Warren Buffett disclosed the mammoth Amazon stock acquisition to CNBC earlier in the month but didn’t disclose the amount.
The Oracle of Omaha did make sure to let everyone know it wasn’t he who finally put some Amazon stock on Berkshire Hathaway’s books but one of the company’s major asset managers:
“One of the fellows in the office that manage money… bought some Amazon so it will show up in the 13F.”
Amazon Stock Purchase a Value Investment?
Responding to a shareholder question about whether the high-stakes purchase of an innovative technology company is a value investment, Warren Buffett assured attendees at Berkshire Hathaway’s annual shareholding meeting that the two asset managers who made the purchase are value investors:
“It’s interesting that the term ‘value investing’ came up because I can assure you both managers — and one of them bought some Amazon stock in the last quarter — he is a value investor.”
Buffett was referring to Berkshire Hathaway’s Todd Combs and Ted Weschler, two asset managers with $13 billion of Berkshire’s $173 billion portfolio on their books.
“The two people that, one of whom made the investment in Amazon, they are looking at hundreds of securities. Because they are managing less money in their universe, they are looking for things that they feel they understand what will be developed by that business between now and judgment day.”
Buffett Calls Himself an ‘Idiot for Not Buying’
“I’ve been a fan, and I’ve been an idiot for not buying. But I want you to know it’s no personality changes taking place”
Though the legendary value investor has long admired Amazon, he has waited decades – as he famously did with Apple Computer – to invest after its IPO.
Buffett has suggested before that what’s kept him away from Amazon’s stock for so long is the sting of regret he’d feel from buying the company’s shares at such a high price when he absolutely saw its world-changing potential. Last year in an interview with CNBC, Warren Buffett said:
“It’ll probably be tough. I’ve probably got so many psychological problems with the fact that I didn’t do it that it’s very hard to do it.”