Veteran financier Warren Buffett is a fan of Apple and a big buyer of bank stocks, but might an entire airline be next on his shopping list?
A group of analysts at Wall Street bank Morgan Stanley thinks that could be the case.
In a research note published this week and cited by Business Insider, they write that "based on historical precedent and the state of the [airline] industry” a full-scale acquisition of an airline by Mr Buffett’s Berkshire Hathaway investment firm is a possibility, “particularly if the stocks weaken”.
Mr Buffett doesn’t have a track record of snapping up whole airlines but he did displayed a penchant for bulk buying in the rail industry when he snapped up Texas-based freight railroad company Burlington Northern Santa Fe, in 2009.
In terms of which airline Mr Buffett might have his eye on, the analysts say that Southwest could be a “plausible” candidate, according to Business Insider, because it is largely focused on the domestic market, shows growth potential and has a well-established management team.
Berkshire Hathaway has been a particularly aggressive buyer of stocks in recent months.
According to Reuters, in the final quarter of 2016, the company quadrupled its stake in Apple and increased its holding in the four biggest US airlines sevenfold.
According to regulatory filings cited by Reuters, Berkshire recently had $9.3bn in airline, with investments topping $2.1bn in each of American Airlines Group, Delta Air Lines, Southwest Airlines and United Continental.
