Buffett’s Portfolio Managers Delivering Outstanding Results

Buffett’s Portfolio Managers Delivering Outstanding Results
By USA White House [Public domain], via Wikimedia Commons

Warren Buffett’s portfolio managers, Ted Weschler and Todd Combs are delivering outstanding results based on the analysis of Fortune.

The outstanding performance of Weschler and Combs is not surprising since Buffett himself proudly declared that his stock pickers made a substantial amount of profit for Berkshire Hathaway Inc (NYSE:BRK.A) (NYSE:BRK.B).

Buffett’s stock pickers outperform the market

Buffett stated in his annual letter to shareholders in April that Weschler and Combs “handily” outperformed the market.

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“They have made Berkshire billions already that we wouldn’t have otherwise made. They both have a fundamental combination of soundness and brilliance,” said Buffett in a previous interview with CNBC.

Based on Fortune’s evaluation, Weschler and Combs performance were impressive. Buffett’s portfolio managers beat the S&P 500 during since they started their career at Berkshire Hathaway Inc (NYSE:BRK.A) (NYSE:BRK.B).

Combs generated an aggregate return of $116% over the past nearly four years compared with 55% return of the S&P 500 in the same period. Last year alone, the equities in his portfolio climb 51%.

Buffett hired Weschler later than Combs, which means he’s been managing his portfolio at Berkshire Hathaway Inc (NYSE:BRK.A) (NYSE:BRK.B) for three years.

During the first nine months last year, Weschler’s portfolio gained 20% compared with the 18% gain of the S&P 500, according to data compiled by Fortune. His portfolio is currently up by 81%, which is far above the market this year. Buffett said Weschler’s performance exceeds the estimate of Fortune, but did not provide details.

Weschler and Combs have knack for picking stocks near lows

According to Fortune, Buffett’s portfolio managers made educated guesses and very good investments for Berkshire Hathaway Inc (NYSE:BRK.A) (NYSE:BRK.B).

The firm said Weschler and Combs “seem to have a knack for catching stocks near their lows.” For example, Combs acquired shares of MasterCard Inc (NYSE:MA) at around $25 per share. The stock is currently at $70 per share.

On the other hand, Weschler invested in DaVita Health Care Partners Inc (NYSE:DVA). Over the past 52-weeks, the stock price of the company climbed from $52.75 to $75.39 per share.

“Combs tends to get in and out of stocks much faster than Buffett. Weschler prefers to buy and hold a few stocks for a long time,” according to Fortune. The firm observed that the investing philosophy of both portfolio managers has a lot in common with Buffett.

Weschler and Combs manages a total of more than $14 billion out of the $115 billion stock portfolio of Berkshire Hathaway Inc (NYSE:BRK.A) (NYSE:BRK.B). They manage their portfolio independently, but they inform Buffett about their stock picks prior to investing for compliance reasons.

See the full article by Stephen Gandel of Fortune here.

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