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Stock Strategist

Three Great Companies Buffett Would Avoid

They may not make his buy list, but should they make yours?

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The Bellwether 50 is a watch list of companies we highlight each month in Morningstar’s StockInvestor newsletter. It features 50 companies with large competitive advantages, or what Warren Buffett likes to call "economic moats." The list includes Pfizer (PFE), Dell (DELL), Wal-Mart (WMT), American Express (AXP), United Parcel Service (UPS), and 45 other high-quality companies.

But although we use a Buffett term to describe the companies on the Bellwether 50, it doesn't mean Buffett himself would buy every one on this list. In fact, there are a few I'm almost certain he wouldn't buy, no matter what the price. Three of them are  eBay (EBAY),  Intel (INTC), and  Amgen (AMGN). All three are well-managed, dominant companies, and all three have wide economic moats by our definition.

Mark Sellers does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.