Warren Buffett invested $200 million in a fancy furniture retailer with a CEO who likes to quote him
- Warren Buffett invested more than $200 million in a fancy furniture retailer with a boss who has a history of quoting the legendary investor.
- Buffett's Berkshire Hathaway conglomerate bought $206 million worth of shares in RH last quarter, according to a SEC filing.
- "As Warren Buffett said, if the skies darkened and there's an opportunity it's going to rain gold, you want to run outside with washtubs and not teaspoons," RH CEO Gary Friedman said last year.
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Warren Buffett invested more than $200 million in a fancy furniture retailer whose boss has a history of quoting the legendary investor.
Buffett's Berkshire Hathaway conglomerate bought $206 million worth of shares in RH - which sells everything from sofas and sheepskin rugs to paintings and poker tables - last quarter, its latest SEC filing shows. RH's CEO, Gary Friedman, has quoted Buffett on at least two occasions.
"If the market undervalues a company, as Warren Buffett said, if the skies darken and there's an opportunity it's going to rain gold, you want to run outside with washtubs and not teaspoons, right," he said on an earnings call in December 2018.
"Warren Buffett likes to say, 'Time favors the well-led and well-managed company,'" he said at an investor day in November 2017.
RH's promise of incredible overseas growth was probably a bigger draw.
"We just got back from Europe and saw some things that are going to make New York look like yesterday's news, seriously," Friedman said on RH's earnings call in September. "I think the opportunity internationally is probably - could be three to four times what we do in North America."
"If you've ever seen 'Finding Nemo,'" he added, "The fish tried to get out of the fish tank and they figured out how to get into a plastic bag and get out on the dock and then they jump into the ocean. But they're still in the plastic bag and they look at each other and they go, 'Now what?' And we had one of those 'now-what' moments."
RH grew its net revenues by 9% to $1.3 billion in the first half of this year, driving its net income up 13% to nearly $100 million, its latest earnings show. News of Buffett's stake drove its stock up 7% on Friday, raising its market capitalization to over $3.5 billion.