Warren Buffett’s Berkshire Hathaway is coming off a particularly strong year, even as the Oracle of Omaha pauses buybacks and sells most of its top holdings ahead of a big rally. The Omaha-based conglomerate’s Class A shares are up 27% in 2024, slightly outperforming the S&P 500. This year was also the company’s ninth profitable year. BRK.A YTD Mountain Berkshire Hathaway The 94-year-old legendary investor has made a series of eye-catching moves this year. First on the list was aggressive selling of his two largest holdings – Apple and Bank of America. Buffett began reducing his stake in the iPhone maker in the fourth quarter of 2023 and stepped up the selling in the second quarter of 2024, when he unexpectedly sold off nearly half of his shares. After selling another quarter of his shares, Buffett now owns about 300 million shares. It was down 67.2% from the end of the third quarter last year. Buffett also surprised onlookers by reducing his long-held stake in Bank of America. Berkshire Hathaway began selling aggressively in July, eventually taking its holdings below the 10% threshold, keeping further moves under wraps for the time being. However, both stocks have performed well this year, with Apple shares up nearly 28% and Bank of America shares up more than 35%. The re-election of Donald Trump, who wants to deregulate the banking industry, gave bank stocks a big boost. These aren’t the only stocks Berkshire has sold this year. All told, Berkshire sold a whopping $133 billion worth of stock in the first three quarters of 2024. Berkshire Hathaway did not repurchase any company stock in the third quarter. Repurchase activity had slowed earlier this year, with second-quarter repurchases of just $345 million, significantly lower than the $2 billion in each of the previous two quarters. The company said it will repurchase shares when Buffett “believes the repurchase price is less than conservatively determined intrinsic value of Berkshire Hathaway.” US$300 billion in cash As Buffett sold stocks aggressively, Berkshire Hathaway’s huge cash reserves exceeded US$300 billion for the first time in the third quarter. As for major acquisitions, Buffett is again mostly on the sidelines as asset prices continue to rise. One of the smaller deals Berkshire completed this year was the purchase of the remaining 8% stake in Berkshire Hathaway Energy, which has held a majority stake in the utility giant since 1999. With $2.37 billion in cash, $600 million in debt and the heirs of the late Walter Scott holding a large number of Berkshire Class B shares. Friend, passed away in 2021. Kevin Heal, an Argus analyst who covers Berkshire Hathaway, said: “We believe some of the $325 billion in cash will ultimately be used to invest in ‘distressed’ industries or individual companies. , just as BRK did during the last economic crisis. “It will also provide an opportunity for Mr. Buffett’s successor to make his mark when he formally hands over power. New Stock Picks Berkshire Hathaway did make some small equity investments during the year, possibly by Buffett’s investment lieutenants Ted Weschler and Todd Combs. Most recently, the group disclosed Berkshire also increased its stake in satellite radio company SiriusXM to more than 30% last quarter by taking a $500 million stake in Domino’s Pizza and a smaller stake in pool provider Pool Corp.
