- Warren Buffett appreciates at least one thing about Uber, said the famous investor’s deputy.
- “We like verbs in Omaha,” Ted Weschler said, according to Brad Gerstner of Altimeter Capital.
- Buffett and his team recognize the value of Uber’s strong brand, Weschler said.
Uber may be far from typical Warren Buffett, but according to one of his surrogates, he likes at least one aspect of the ride-hailing company’s business.
Brad Gerstner, founder and CEO of Altimeter Capital, recently said the “Art of Investing” podcast, in which he discussed the ride-sharing app with Ted Weschler, one of Buffett’s two portfolio managers at Berkshire Hathaway.
Weschler told Gerstner that Uber is a technology company he can understand “because it’s a verb – you Uber.”
“We like Omaha verbs,” Weschler continued, nodding to Buffett’s hometown, where Berkshire is headquartered. “We get consumer products that people love and that are irreplaceable. And in our opinion, this is what makes Uber the most interesting.”
Buffett attaches great importance to profitability, predictability and price when investing and tries to stay within his circle of competence, avoiding companies about which he knows little. As a result, he avoided aggressively valued, loss-making, disruptive technology companies for much of his career.
Berkshire’s CEO appeared to have moved away from this approach when he pumped more than $30 billion into Apple between 2016 and 2018. The position has since more than tripled in value, making the iPhone maker easily the largest holding in Berkshire’s roughly $350 billion stock portfolio.
Buffett explained that he not only likes Apple’s large share buyback spending and its market position; also appreciates its strong brand and irreplaceable products for customers.
Weschler’s comment to Gerstner suggests that he views Uber in a similar light – as a brand so ubiquitous that people claim to be the “Uber” of somewhere as much as they are the “Google” of information.
Gerstner described on the podcast why he’s bullish on Uber in the coming years. CEO Dara Khosrowshahi cleaned up the company’s culture, he said, solving a key problem that afflicted founder and former CEO Travis Kalanick.
He also suggested that Uber’s days of burning cash are over. The company posted a net profit of nearly $500 million in the first nine months of this year, after losing nearly $10 billion in the same period in 2022.
Weschler, at least in Gerstner’s opinion, did not suggest that Berkshire would buy shares in Uber any time soon.
However, the gig economy giant’s share price has surged 120% this year to its highest level since early 2021, making it an excellent choice for investors who have recently joined the stock.