Ten days ago, the news broke: Warren Buffett, famed value investor and CEO of consumer brands mega-conglomerate Berkshire Hathaway (NYSE:BRK.A) (NYSE:BRK.B), had bought a $549 million stake in supermarket chain Kroger (NYSE:KR). The vote of confidence from the so-called Oracle of Omaha immediately lifted Kroger stock, which closed last week's trading up 7.4% from where it was when the news was first announced.
There's just one problem with that: Warren Buffett didn't actually decide to buy Kroger -- at least not personally.
Instead, as CNBC reports this morning, one of Buffett's lieutenants made the decision. It was not Mr. Buffett himself who demonstrated confidence in Kroger sufficient to lay out half a billion dollars to invest in it.
In fact, while Buffett says Kroger is doing a good job, he also said grocery is a "tough business," which suggests he isn't quite so sanguine about Kroger's business as recent stories on the Berkshire purchase may have made it sound.
Caveats and quibbles, you say? Perhaps. At the very least, Buffett did decide to delegate the decision to buy Kroger stock to his lieutenants. And so far today, Kroger stock is holding up very well against the market rout, with its shares up 0.6% at 10:30 a.m., versus an S&P 500 that's down 2.9%.