Warren Buffett has made some rather bearish moves in Berkshire Hathaway‘s (NYSE: BRK.A)(NYSE: BRK.B) stock portfolio in the past few quarters. Most notably, the legendary investor disposed of significant portions of both the Apple and Bank of America investments that have performed extremely well for Berkshire. It’s been quite a while since Buffett and his team have been net buyers of stocks.
However, we recently learned that Buffett took advantage of the recent stock market sell-off by adding to three of Berkshire’s existing stock positions. Here’s what he bought, where these investments stand in Berkshire’s portfolio, and some important things we don’t know.
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After the Federal Reserve announced its latest interest-rate decision, financial markets sold off as the pace of future rate cuts appears that it will be slower than most had expected. During the sell-off, Warren Buffett-led Berkshire Hathaway bought shares of three stocks:
9 million shares of Occidental Petroleum (NYSE: OXY)
5 million shares of Sirius XM (NASDAQ: SIRI)
234,000 shares of VeriSign (NASDAQ: VRSN)
The Occidental purchase was the largest in terms of dollar value, with a cost of approximately $405 million. The other two combined for about $158 million in total purchase volume.
After the purchases, Berkshire owns a total of 28.2% of Occidental, a stake Buffett has built steadily in recent years. With the new purchases, Berkshire also owns nearly 35% of Sirius XM and 13.6% of VeriSign.
To be perfectly clear, we don’t know why Warren Buffett and his team decided to make these purchases. Buffett rarely speaks publicly about specific stock purchases, but the fact that all three stocks have underperformed the market recently likely has a lot to do with it.
It’s important to mention that these three stocks are unique in Berkshire’s portfolio. Typically, we only learn about Berkshire’s stock portfolio activity when the company reports its quarterly 13-F filing to the SEC, which comes 45 days after the end of each quarter. (The latest one happened in mid-November.)
The only reason we know about these three moves is that Berkshire is required to disclose them in a timely manner because it owns more than 10% of each of the three companies. This rule is why we didn’t know about the Apple stock sales right away. Although Apple was (and still is) a massive investment for Berkshire, it represents far less than 10% of the tech giant. However, Berkshire owned well over 10% of Bank of America at the start of 2024.
We don’t know for sure if these are the only three stocks Berkshire has been buying recently or if there were others. We won’t find out until the fourth quarter 13-F filing is released in February.
Berkshire’s cash stockpile swelled to more than $325 billion at the end of the third quarter, mainly fueled by some major stock sales in its portfolio. Not surprisingly, many investors believe Buffett has soured on the stock market and is expecting tough times ahead.
While we don’t know Buffett’s current opinion on the market, and these buys represent about 0.2% of Berkshire’s cash, it’s an encouraging sign that he’s still finding some attractive places to put at least a little of Berkshire’s capital to work.
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Bank of America is an advertising partner of Motley Fool Money. Matt Frankel has positions in Bank of America and Berkshire Hathaway. The Motley Fool has positions in and recommends Apple, Bank of America, Berkshire Hathaway, and VeriSign. The Motley Fool recommends Occidental Petroleum. The Motley Fool has a disclosure policy.
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