What's on Warren Buffett's Christmas List?

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Nov. 4 (Bloomberg) -- Jeffrey McCracken reports on Warren Buffett's "Christmas List" of good companies at discounted prices. McCracken speaks on Bloomberg Television's "Market Makers." (Source: Bloomberg)

Buffett has on a number of occasions talked about the criteria in value for investing.

The return on equity really important, it needs to be greater than 15%, and that it averages -- it averages are greater than 15%, that it is conservatively financed, and has this great margin of safety.

A forward price to earnings ratio of less than 20%. that is why buffett has stayed away from tech.

You laid out specifics, but there is also the general release -- the generalities.

He does understand social network to my he does not understand technology, so there are businesses in that base that fit those categories in terms of the safety net, but he has not gone there.

So you have to start looking, what is egg, and safe -- big, safe, and do something he would understand?

The truth of the matter is that there are not that many companies that we -- meet that criteria.

Buffett, whose has some large amounts of cash, could not even limit not even move the needle.

We looked earlier this year, and we know granger, take industrial products company is now closer to 20, so that would fit closer to his criteria.

We are in the realm of speculation here, so you also have general mills.

That is a big company, consumer products.

I think he understands it quite well, it is easy for someone like war into understand -- warr eenn to understand.

Buffett has been known to break its own rules to get a deal done, in the case of heinz.

He actually negotiated with them, and they got a pretty good deal out of him and his partners made -- parteners.

Isn't getting harder for -- if it's getting harder for buffett?

He has done tons of deals.

If it's getting harder for him to find multi-billion-dollar companies?

It is difficult to find things that are inexpensive.

Companies that are underpriced, activists might have beaten him to the punch.

That also take out some candidates he might have looked at in the past.

There is a company that does dialysis or kidney care, and he owned a large portion of that.

He knows it pretty well.

It may be speculative, but

This text has been automatically generated. It may not be 100% accurate.


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