Scraping together enough coin to win the annual auction of lunch with Warren Buffett is probably beyond most investors' means. With the proceeds going to charity, this year's winning bidder forked over $2.63 million for the privilege.

Feast or famine
While we likely can't afford to break bread with the greats, we can peek at their stock ideas through their SEC filings. Here, we'll pore over some of the top investors' reports to see which stocks they've chosen as their best investments. We'll then check in with Motley Fool CAPS members to learn whether they agree.

First, a few caveats

  • There's a delay between when the stocks were bought and when these investors filed their paperwork, so they might have sold out since.
  • These legends may be hot investors now, but that can change in an instant. Bill Miller was a wunderkind after beating the market 15 years in a row. Then he went cold for three. He came back in 2009, but we don't know what 2010 will bring.

Contrary to popular opinion
Fools should definitely do their own further research. But in the meantime, let's take a look at Tweedy, Browne, the company that used to execute trades for Benjamin Graham and Buffett, and which follows the same value investing principle of buying at a discount to intrinsic value as a means of increasing one's margin of safety.

Fund: Tweedy, Browne
No. of Stocks Owned: 57
Top 5 Holdings: Philip Morris, Johnson & Johnson, Berkshire Hathaway, Coca-Cola Femsa, ConocoPhillips
Top Sectors: consumer goods, financials, industrials, health care, consumer services

Like a number of the investing legends we've looked at, Tweedy, Browne has a comparatively concentrated portfolio, but with the sectors of the economy it's focusing on it seems it's betting on an economic rebound. Let's look closer at a few of the most recent choices.


Average Price

Current Price


CAPS Rating
(out of 5)

Bank of New York Mellon (NYSE: BK)





Baxter International (NYSE: BAX)





Broadridge Financial Solutions (NYSE: BR)





Source: GuruFocus and Motley Fool CAPS.

Price is what you pay
Many companies like to trumpet consecutive quarterly dividend payments spanning several years, and without a doubt it's an achievement worthy of note. But you have to imagine the smirk on the faces of the executives of Bank of New York Mellon, one of the premier money and wealth management firms in the world, which has an uninterrupted record of paying dividends since 1785. JPMorgan Chase has only been at it since 1827, while US Bancorp is relatively new to the scene, paying out cash dividends since 1863.

Of course, the smirk might also be because so-called pay czar Kenneth Feinberg decided not to force Bank of New York Mellon and 16 other financial institutions he identified as making "ill-advised" executive compensation to pay it back.

That no doubt makes the investment community smile, too; 83% of the CAPS members rating the money manager believe it will go on to outperform the broad market averages. You can deposit your thoughts on the Bank of New York Mellon CAPS page, or let us know in the comments section below whether it's time to withdraw from financial stocks.

Fist pumping
Baxter International investors' hearts skipped a beat in April when the FDA ordered the medical device company to recall all of its 200,000 Colleague infusion pumps, which automatically deliver solutions such as drugs and food to patients. The agency reportedly said infusion pumps had been the subject of 56,000 complaints of injuries, death, and malfunctions, and were being targeted for an initiative to improve their safety. Note that Baxter has indicated that the pumps have not been sold to new customers since 2005. The recall cost Baxter $588 million in the first quarter. Baxter, Hospira (NYSE: HSP), and CareFusion (NYSE: CFN) are among the biggest manufacturers of these pumps.

CAPS member easmith88 thinks the pummeling Baxter took in the recall's aftermath presents an opportunity, because it has a diversified portfolio of products on the market:

Long term, I think it bounces back, considering its other product lines and the one that was recalled hasn't been shipped since 2005. That's why the stock is so low right now though.

You can bank on it
That prospectus you received the other day was probably processed by Broadridge Financial Solutions, a company you interact with regularly but just don't know it. Spun off from Automatic Data Processing (Nasdaq: ADP) in 2007, it provides annual proxy services for 90% of the public companies and mutual funds in the United States. It just recently sold its clearing business to Penson Worldwide, leaving Broadridge to focus on its securities processing and outsourcing services.

With a planned move to electronic distribution of shareholder materials, CAPS All-Star TMFDeej sees Broadridge saving a ton of money while fending off competitors:

Buying shares of [Broadridge] is a bet that the electronic delivery of shareholder communications does not enable competition to cheaply enter the market and steal share from the company. I'm guessing that Broadridge continues to dominate the sector.

Value is what you get
Become an investing legend yourself by starting your own research on these stocks on Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from a stock's CAPS page.

Sign up today for the completely free service, and tell us whether these stocks are as good a value as these investing legends think they are.

Berkshire Hathaway is a Motley Fool Inside Value pick and a Motley Fool Stock Advisor recommendation and the Fool owns shares. Automatic Data Processing and Johnson & Johnson are Motley Fool Income Investor picks. The Fool owns shares of and has written puts on Broadridge Financial. Motley Fool Options has recommended a diagonal call position on Johnson & Johnson. Try any of our Foolish newsletter services today, free for 30 days.

Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.