Warren Buffett is on the move again by purchasing $250 million worth of debt from Tiffany’s. Half of the debt will mature in 2017, while the rest will mature in 2019.
Tiffany said the proceeds of the Notes will be used to refinance existing indebtedness and for general corporate purposes. Unlike Berkshire’s investments in General Electric and Goldman Sachs, these notes do not have warrants attached to them.
This is another one of the legendary Wizard of Omaha investments in high profile companies. His list of fixed income or preferred stock investments range from Goldman Sachs, General Electric, USG, Swiss Re and Harley Davidson. In his article "Buying American", Buying American, Buffett expressed his bullishness on the future of US economy and stock market. Once again however, it’s always good to read between the lines, as Buffett’s Berkshire Hathaway doesn’t seem to have purchased any common stock in the above-mentioned names. His holding company has rather gained preferential terms with the companies that received “Berkshire Hathaway Troubled Assets Relief Program”, as his name carries a very good premium. After the closing bell, Berkshire will file its portfolio "snapshot" taken at the end of the quarter, on December 31.
I would not be investing in Tiffany’s based off Buffett’s fixed income play there; the company does appear to have a good presence in the luxury goods market. The current crisis hasn’t missed this jewelry retailer, which warned last month that its same-store sales for the holiday season fell 24 percent as sales slowed in its domestic stores.
It would be interesting to note if TIF would keep its dividend payment. Other similar Berkshire investments such as Harley Davidson cut their dividend payments just days after announcing Buffett’s investment in their fixed income notes. General electric on the other hand has not announced any cuts, although many investors believe that the dividend is on the chopping block.
Full Disclosure: None
Relevant Articles:
- Warren Buffet’s Investment in Harley-Davidson, don't get too excited about...
- Analysis of General Electric
- Warren Buffett – The Ultimate Dividend Investor
- Berkshire Hathaway Portfolio Changes for the quarter
Popular Posts
-
A famous saying goes that there are two things certain in this world: death and taxes. While I am pretty sure I can’t escape death, I know t...
-
The S&P Dividend Aristocrats index tracks companies in the S&P 500 that have increased dividends every year for at least 25 years...
-
The year 2022 was a good one for dividends. " Dividend payments continue at record levels. The strength of the increases has declined,...
-
As part of my review process, I monitor the list of dividend increases every week. This exercise helps me monitor existing positions, but al...
-
Peter Lynch is probably one of the best-known stock pickers of our time and certainly among the most successful. He was portfolio manager of...
-
As part of my monitoring process, I review the list of dividend increases every week. I use this exercise to review existing holdings, and t...
-
I review the list of dividend increases every week, as part of my monitoring process. This exercise helps me review existing holdings, and a...
-
A dividend king is a company that has managed to increase dividends to shareholders for at least 50 years in a row. There are only 45 such ...
-
Today marks the 15th birthday of the Dividend Growth Investor blog. It is unreal that I have managed to keep this up for 15 years in a row. ...
-
As part of my monitoring process, I review the list of dividend increases every single week. This process helps me to identify patterns, and...
