Warren Buffett has been one of the world's greatest investors over the last several decades, helping Berkshire Hathaway (NYSE: BRK.B) become of the largest businesses in the world. Would such a great investor be interested in CSL Ltd (ASX: CSL) shares today?
Berkshire Hathaway has invested in a variety of industries over the years, including railroads, banks, Apple (NASDAQ: AAPL), insurance, oil and gas, soft drink, and so on. There's nothing to say that Berkshire Hathaway wouldn't be open to buying shares in a biotech company.
Let's look at what Warren Buffett might think of CSL shares.
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Is CSL a wonderful company?
There have been few businesses on the ASX that have expanded as much internationally as CSL over the last 20 years. It has been a great Australian success story.
However, the CSL share price has suffered a big decline in the past year, falling by around 50%. The market doesn't seem to think as much of the business as before.
Are the current difficult conditions CSL is facing temporary or is this now a permanent, lower growth environment for the company? You'd need a crystal ball to truly know the answer to that question.
But, when it comes to market confidence, Warren Buffett has said some potentially very useful advice in the past. For example, he has said generally about markets:
Be fearful when others are greedy, and greedy when others are fearful.
By that logic, investors may have been too fearful about the CSL share price earlier this year. But the CSL share price has risen by around 33% since the 2026 low in June – it's not as cheap as it was, even though it has fallen heavily over the longer term.
Warren Buffett has also suggested that it's better to buy a wonderful company at a fair price than a fair company at a wonderful price.
Before 2025, I think most investors would have been happy to describe CSL as a wonderful company with its ability to grow its core business, create new products with research and development (R&D), and deliver rising profit.
Is CSL still a wonderful company? The market doesn't seem convinced.
Warren Buffett's Circle of competence
For me, what could be the deciding factor in whether Warren Buffett would buy CSL shares is what he likes to call a circle of competence.
In other words, he only invests in businesses that he understands. That's why he famously avoided various technology businesses over the years. It's important to understand the potential gains, the competitive pressures and risks.
I think that same investment thought process would mean Buffett would be hesitant to invest in CSL – biotechnology is a difficult industry to understand, and it may be challenging to get to grips with how the research and development (R&D) pipeline could play out and what the financial rewards could be. Therefore, there are other ASX shares that I think Warren Buffett would be more interested in.
