Warren Buffett’s Berkshire Hathaway is seen as a top defensive stock by veteran investor Joe Tigay. Tigay is the Portfolio Manager of the Rational Equity Armor Fund. In a recent discussion with Yahoo Finance, Tigay said defensiveness is a wise strategy in the current economic environment.
He pointed to warning signs of a potential recession coming from the bond market. “I want to get a little defensive for the next couple of quarters, even though my long-term approach to U.S. stocks remains bullish,” Tigay said. He noted there are no positive catalysts on the horizon at this point.
Tigay praised Berkshire Hathaway for how it manages its cash. He suggested Warren Buffett, the legendary investor and CEO of Berkshire, is poised to use this capital effectively.
Defensive investment strategy
“Berkshire has done a great job of hoarding cash,” Tigay remarked. “Buffett will be able to find cheap stocks to buy in the current environment.
Tigay also highlighted the stability of Berkshire’s portfolio. It is made up of stocks that investors view as value-oriented.
They are seen as capable of weathering economic turbulence. He suggested that in the short term, investors are likely to shift their focus to value stocks. Berkshire owns many significant names in this category.
Tigay’s insights point to a cautious yet optimistic view of Berkshire Hathaway’s potential. The company may endure and possibly thrive during uncertain economic times. As investors grapple with recession fears, the stock is seen as a bastion of stability and prudent management.
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