Warren Buffett’s portfolio has been hit by the massive market selloff over the past week. At the same time, speculation is that he will finally use some of the $344 billion in cash on the Berkshire Hathaway (NYSE: BRK-B) balance sheet. Maybe with the marker battered so hard, he will find what he views as bargains and start to buy.
The downturn has hit Berkshire’s shares, but much less than the S&P. Berkshire Hathaway’s stock is up 8% this year, while the S&P 500 is down 14%. It might be argued that his own conglomerate is his single safest holding now.
However, a look at Berkshire’s portfolio shows one of his largest positions is Domino’s Pizza, Inc. (NYSE: DPZ); its stock is up 9% this year. Its price has held steady through the brutal downturn. At $441, it is the same price as on March 17, as the market was in the earliest part of its selloff.
There is a good reason to like Domino’s. While many fast food chains have struggled, in its most recently reported quarter, revenue rose 4.4% to $5.9 billion. EPS rose 9% to $4.89. Dominos also increased its quarterly dividend by 15% to $1.74. Russell Weiner, Domino’s Chief Executive Officer, commented, “Domino’s 2024 results demonstrated that our Hungry for MORE strategy can drive strong order count growth, even in the face of a challenging global macroeconomic environment.”
Domino’s store count is the 7th largest among all fast food chains, with 7,053 locations. That puts it ahead of rival Pizza Hut, which has 6,739,
Domino’s has expanded its ability to reach customers. It recently set a deal with Doordash, North America’s top local delivery business. The project will be rolled out this year.
From Buffett’s standpoint, Domino’s has a steady business. And, as a fast food chain, it may be close to recession-proof.
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