Warren Buffett, the famous junk food enthusiast, has just invested in a national pizza chain, whose stocks are currently trading close to their lowest levels this year. According to recent regulatory filings, Berkshire Hathaway purchased over 1.2 million shares last quarter.$Domino's Pizza (DPZ.US)$with a market cap of approximately 0.55 billion dollars.

In Berkshire's massive investment portfolio, this investment represents a very small proportion, with cash reserves exceeding 300 billion dollars. Therefore, Buffett's investment aides Ted Weschler and Todd Combs are likely the driving forces behind this investment. Regardless of whose initial idea it was, the investment in domino's pizza aligns with the long-term investment strategy of this Omaha-based conglomerate. Berkshire already owns 100% of See's Candies and Dairy Queen, andcoca-cola (KO.US) the parent company of Oscar Mayer hot dogs.$The Kraft Heinz (KHC.US)$Also among its main stock investments.

The 94-year-old billionaire Buffett, known for his child-like eating habits, has proudly stated that he is willing to drink five cans of coca-cola every day, eatmcdonald's (MCD.US) . Despite his seemingly indulgent diet, Buffett maintains good health. "I eat like a six-year-old child," the CEO of Berkshire has said. "If I consume 2,700 calories a day, then a quarter of that comes from coca-cola," Buffett humorously remarked.

In 2014, Berkshire invested 3 billion dollars to buy$Restaurant Brands International (QSR.US)$stocks of the company (Restaurant Brands International), which is the parent company of Burger King and Tim Hortons, and it held a significant amount of mcdonald's (MCD.N) shares in the 1990s.

As of this year, domino's pizza's stock performance has lagged behind the S&P 500 index. This year, domino's pizza's stock return is around 10%, far behind the S&P 500 index's 25% return. Berkshire's investment aligns with its value investing philosophy, focusing on cash flow, price-to-earnings (P/E) ratio, and price-to-book value (P/BV) ratio.

At the same time, Berkshire may merely have taken advantage of the sharp sell-off that domino's pizza experienced in July, when its stock price plummeted 17%. In one day, the stock price of the world's largest pizza chain dropped by more than 13%, marking the largest single-day drop since 2008, because the company informed investors that its sales would fall below the original forecast and that the number of new overseas stores planned would be less than expected. According to FactSet data, domino's pizza's pe ratio fell to 23.7, the lowest value for this year.

Although Berkshire's disclosure prompted a rise in domino's pizza's stock price, the company still lags behind the performance of the S&P 500 index. Barclays Capital analyst Jeffrey Bernstein stated, "The short-term fundamentals are still under pressure. Just like in the past 'Burger Wars', management believes we are now in the 'Pizza Wars', where all companies are focused on incremental value."

He also mentioned that Berkshire’s newly disclosed equity was mentioned in meetings with domino's pizza's management, but the company did not provide many details. "We do not believe they spoke with Warren Buffett," Bernstein told CNBC, referring to domino's pizza's management, but executives may have received questions from Berkshire prior to announcing the equity.

Editor/rice