Image source: The Motley Fool
If you ask me, Warren Buffett’s investing style is the gold standard for the everyday investor. Value investing — buying good companies and holding for the long term — is as simple as it is effective.
Since Buffett started applying his philosophy with his investment firm Berkshire Hathaway in the 1960s, the shares have returned nearly 20% a year. And of all the stocks currently in the Berkshire portfolio, only one is listed on the London Stock Exchange.
What is Buffett’s sole UK holding and is it worth buying? Let’s explore.
The good stuff
As of the last reported date of 31 March 2025, the Berkshire Hathaway portfolio comprises 36 holdings. The majority are, like Warren Buffett himself, American. Firms like Apple, Amazon, American Express, Bank of America, and Coca-Cola are some of the big hitters among them.
Going down the list, you’d be forgiven for wondering if Buffett gave a hoot about investing in any other country than the good old U-S of A. But one British company does make the list – FTSE 100 firm Diageo (LSE: DGE), best known for its drinks ranges including Guinness, Johnnie Walker, Tanqueray, and Smirnoff.
A $300bn portfolio centred firmly on the US has one British company squeak its way in. So, there must be something there he really likes, wouldn’t you think?
Diageo’s moat is likely something he admires. An ‘economic moat’, a term coined and popularised by Buffett, describes how defensive a company’s revenues are. Just like a moat of water protects a castle from invaders, an economic moat of beloved brands like Guinness or Smirnoff protects against would-be competitors.
I own shares in Diageo myself and one of the attractions was that it’s hard to see such popular brands of beer or spirits losing much market share.
A buy?
Market share is only one part of the equation, however, especially when the size of the market is decreasing. The younger generations are drinking less and going out less. And the new-fangled weight loss drugs like Ozempic and Wegovy cause folks to drink less.
This bleak future for alcohol sales is perhaps why the stock is looking cheaper than ever, down 50% from an all-time high and trading at only 15 times earnings, closing in on half of its valuation only a few years ago.
Buffett perhaps won’t be overly concerned. Diageo makes up just a tiny fraction of his entire portfolio. He holds a $23m stake on the last available record, a 0.08% of his entire holding.
Leaving aside the question of why a multi-billionaire investor holds such relatively small positions, Diageo is in a tough spot. I own the shares myself and still like the company. But, given the uncertainty, I don’t think I’d recommend it as one to consider.
