How to Invest Like Warren Buffett

Warren Buffett ensured that the question of who would run Berkshire Hathaway BRK.A after him isn’t much of a question at all. In 2021, Buffett named Greg Abel, vice chairman of noninsurance operations, as his replacement. When Buffett announced his retirement plans in May 2025, the board quickly appointed Abel as his successor.

Below, we highlight Buffett’s impact on the investing world, lessons from his life, and what’s next for the company.

What Is Next for Berkshire Hathaway?

In recent years, Abel has taken on more management responsibilities and added to his personal stake in the company. Abel’s work has garnered effusive praise from both Buffett and Charlie Munger, with Buffett saying, “[Abel and I] think alike on acquisitions. We think alike on capital allocation. I mean, he’s a big improvement on me, but don’t tell anybody.”

Abel is expected to maintain his ongoing collaboration with Ajit Jain, vice chairman of insurance operations. Buffett himself rebuffed the idea of a possible management conflict in 2023, noting that “Ajit never wanted to run Berkshire.”

Below, see more in-depth discussions about Berkshire’s future.

The Latest on Berkshire

Below, you’ll find our most recent information on Berkshire Hathaway, from public filings and earnings to notes and reports from Morningstar’s analysts.

Warren Buffett’s Investing Principles

At its core, Warren Buffett’s investing strategy was not all that complicated:

• Buy businesses, not stocks. In other words, think like a business owner, not someone who owns a piece of paper (or these days, a digital trade confirmation).
• Look for companies with competitive advantages that can be maintained, or economic moats. Firms that can successfully fend off competitors have a better chance of increasing intrinsic value over time.
• Focus on long-term intrinsic value, not short-term earnings. What matters is how much cash a company can generate for its owners in the future. Therefore, value companies using a discounted cash flow analysis.
• Demand a margin of safety. Future cash flows are, by their nature, uncertain. To compensate for that uncertainty, always buy companies for less than their intrinsic values.
• Be patient. Investing isn’t about instant gratification; it’s about long-term success.

Buffett’s approach to investing is also embedded in the way Morningstar does business: His thinking is captured in the Morningstar Economic Moat Ratings, stock ratings, and how we communicate with shareholders.

Despite his popular reputation as a man who can pick a winning stock, Berkshire Chairman and CEO Warren Buffett has been more nuanced about where his skills really lie. As he put it in his 2022 Berkshire Hathaway letter to investors: “Charlie [Munger] and I are not stock-pickers; we are business-pickers.”

Over the decades, Buffett refined a holistic approach to assessing a company—looking not just at earnings, but at its overall health, its deficiencies, as well as its strengths. He focused more on a company’s characteristics and less on its stock price, waiting to buy only when the cost seems reasonable.

The content below demonstrates this approach and the variety of ways that you can apply these investing principles.

Other investing virtues not unique to Buffett, but prized by him, come into play at Morningstar every day: candid communication with shareholders, the patience to let an investment bear fruit, and the emphasis on practical vehicles over investing fads.

Reflections on Warren Buffett’s Teachings

Buffett’s investment strategy prioritized thinking like an owner and viewing investments as actual companies, not just as stocks.

He long advocated for “boring” investing and the notion that the real moneymaking happens when you’re sitting back and trusting in a long-term plan instead of strapping in for a wild ride. He also emphasized lifelong learning, whether that means unpacking what a new product is all about or reading up on interdisciplinary subjects.

Legendary as Buffett’s investing legacy is, his ethos in other areas of life is equally renowned.

He reminds us that, as tempting as it may be to believe you earned everything, a lot is also owed to the “birth lottery”—the fact that you were born in the time, place, and body that provided you the ability to capitalize on your particular skill set. And he knows that everything is relative: Yes, his plan to give away 99% of his wealth to philanthropy is a large dollar amount, but he and his family will be just fine without it.

For more on Buffett, here are insights from Morningstar researchers past and present.

How Berkshire Made Money, in Buffett’s Words

There’s no better way to learn about Buffett’s investment strategy than from the man himself.

In the 1950s, Buffett began an annual tradition of writing to his investors about the past year’s results, his takeaways, and his expectations for the future. His yearly Berkshire Hathaway shareholder letters are available, going back to 1977, on the conglomerate’s website. Below, you’ll find our annual recaps of some of his recent shareholder letters.