Donald Yacktman, one of my favorite investors once you get past the list of usual suspects that everyone knows, conducted an interview with Consuelo Mack a month or two ago that explained the rationale for his old-fashioned investing style (his portfolio typically owns large chunks of Procter & Gamble, Coca-Cola, and PepsiCo). My favorite quote from the episode is when he recalls a dinner conversation with his son in which his son explained the Yacktman investing style: “Basically, what you are saying is, if you buy above average businesses at below average prices, then on average, it is going to work” (That quote starts a little after the 14:30 mark).
The largest holdings in the Yacktman Fund currently are: Twenty-First Century Fox, PepsiCo, Procter & Gamble, Coca-Cola, Cisco, Microsoft, C.R. Bard, Sysco, Viacom, and Johnson & Johnson. Yacktman has spent most of his career owning these types of blueblooded companies, … Read the rest of this article!