Warren Buffett Recently Invested in a Pizza Stock: 3 Reasons the Strategy Could Work for You

Warren Buffett made headlines in early 2025, when he announced that Berkshire Hathaway had closed its entire position in two S&P 500 index funds. The Oracle of Omaha had done it again, exiting his position just a few months before the so-called “Liberation Day crash” in early April 2025. But that wasn’t the only move Buffett made.

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Before selling its position in the S&P 500 funds, Berkshire purchased more than 1 million shares of Domino’s Pizza stock, valued at nearly $550 million. Given Buffett’s incredible track record, it’s worth asking whether the same investment could make sense for your own portfolio.

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Why Buffett’s Strategy Could Work for You

It’s never a good idea to buy an asset just because someone you respect did it first. But you might want to follow the same idea once you fully understand it. So by exploring why Buffett bought Domino’s stock, you can decide whether to do the same.

Here are three reasons the strategy could work for you.

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1. Domino’s Focus on Technology

First, Domino’s uses technology better than its peers. This helps it operate more efficiently while providing extra value to its customers. For example, the chain is leveraging AI to anticipate online orders and prepare pizzas before customers purchase them. This reduces delivery times, improving the customer experience and driving more loyalty.

Domino’s is also:

• Experimenting with technology that lets customers place orders through text messages, smart speakers and even social media

• Offering PinPoint Delivery so customers can receive orders at parks, beaches and just about anywhere else they want

• Using AI to inspect pizzas virtually, improving its quality and cutting down on costly errors

2. An Expanding Business

Buffett also probably likes how Domino’s is expanding its business: The company has plans to open 1,100 new stores in the next five years. It expects its sales to grow by 7% annually and its operating income to grow at 8% per year. This kind of expanding presence bodes well for the company’s future profitability.

3. Growing Market Share

Another major trend to watch is Domino’s market share in the quick-service pizza industry. In 2024, the company took another percent of the total market from competitors like Papa John’s and Pizza Hut.

This means Domino’s isn’t just growing in an absolute sense; it’s taking over more of its sector. So if you believe the quick-service pizza industry is poised for continued growth, Domino’s could be the best way to bet on that, assuming the trend remains intact.

Risks To Consider Before Investing

Wall Street agrees that Domino’s earnings should increase by about 8% annually for the next few years. However, like all stocks, this one has risks, and you should understand them before investing.

For example, Domino’s could be disrupted by a new entrant to the quick-service pizza industry and see a decline in its market share. Or the brand could fall out of favor with consumers, as other restaurants have in the past.

You should also know that Buffett and Berkshire take a long-term view on investing. So if you’re going to follow them on Domino’s, don’t expect instant results.

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This article originally appeared on GOBankingRates.com: Warren Buffett Recently Invested in a Pizza Stock: 3 Reasons the Strategy Could Work for You