Berkshire Hathaway, which is led by the legendary Warren Buffett, has said in regulatory filings that it has sold shares of BYD and US Bancorp, two of the companies it has held for years.
Buffett invested in US Bancorp in late 2007 and Berkshire was among the largest stockholder of the fifth largest US bank. At the end of 2021, Berkshire held 144.7 million US Bancorp shares which amounted to a 9.8% stake. After the stock sales, it now holds around a 3.6% stake.
Notably, Buffett tries to keep stakes in banks below 10% to escape regulatory scrutiny. He however made an exception for Bank of America and Berkshire holds over 10% stake in the second largest US bank.
Buffett has always had a flair for banking and financial stocks. However, over the last two years, the “Oracle of Omaha” has fully exited Wells Fargo, Goldman Sachs, and JPMorgan.
He did add a new position in Citigroup though. Buffett is among the best value investors of all time and many investors track his moves closely.
Buffett Has Been Selling BYD Shares in 2022
Berkshire Hathaway is the largest stockholder of BYD which surpassed Tesla to become the largest seller of NEVs (new energy vehicles). BYD stock is also outperforming fellow EV (electric vehicle) stocks in 2022, most of which have slumped amid the market turmoil.
Even Tesla stock recently fell to two years low. Tesla bulls aren’t meanwhile too perturbed by the crash and Cathie Wood of ARK Invest has bought more Tesla shares. We have a guide on how beginners can buy Tesla stock.
Berkshire, which invested in BYD in 2008, has been gradually selling the shares. In the most recent round of stock sales, the conglomerate sold 5.78 million shares for around $146 million and now holds a 16.62% stake in BYD.
Berkshire Hathaway Posted Better Than Expected Earnings in Q3 2022
Berkshire Hathaway reported revenues of $76.93 billion in the third quarter of 2022, a YoY rise of almost 9%. The company’s operating profits increased 20% over the period to $7.76 billion, which was better than expected.
Meanwhile, despite positive operating income in the quarter, Berkshire Hathaway posted a net loss of $2.69 billion due to the mark-to-market loss on its stock portfolio.
Apple is the largest holding for Berkshire Hathaway and Buffett added even more shares in the first half of 2022. Like Berkshire, Apple is also outperforming the markets this year. The iPhone maker is also the best-performing FAANG stock of 2022.
In the third quarter of 2022, Berkshire Hathaway repurchased $1.05 billion worth of its shares which was similar to the previous quarter. In the first nine months, the Warren Buffett-led company has repurchased $5.25 billion worth of its shares.
The buybacks are a pale shadow of what we saw in 2020 and 2021. Between these two years, Berkshire repurchased almost $50 billion worth of its shares.
What is Warren Buffett Buying in 2022?
Next week, Berkshire Hathaway would release its third quarter 13F which would tell markets what all Buffett has been buying and selling. What we know for sure is that he has poured more money into Occidental Petroleum.
It now holds over 20% of Occidental Petroleum and beginning the fourth quarter it would start consolidating its earnings. Berkshire has the regulatory approval to increase its stake in Occidental to 50%.
In the second quarter of 2022, Buffett bought more shares of Apple, Ally Financial, Paramount Global, Occidental Petroleum, Chevron, and Celgene. At the end of Q3, Berkshire had $109 million in cash and cash equivalents, up from $105.4 billion at the end of Q2.
Buffett was a net buyer of stocks in the third quarter of 2022. The conglomerate bought around $9 billion worth of stocks and sold stocks worth around $4 billion. It is the third consecutive quarter when Berkshire was a net buyer of stocks. Before that, the company was a net seller of stocks for five consecutive quarters.
Would there be any surprises in Berkshire’s Q3 13F, or would it be like Q2 when the company did not take any major action, we’ll soon get to know.
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