What were Warren Buffett and his colleagues at
up to with their $350 billion equity portfolio last quarter? Investors will find out very soon.
A regulatory filing expected Tuesday should lift the veil. Investors will be focused on whether Berkshire Hathaway (tickers: BRK/A, BRK/B) added to its stake in
Taiwan Semiconductor Manufacturing
), as well as whether the company continued to pare its longtime interest in
The fourth-quarter 13-F filing with the Securities and Exchange Commission should include any stocks that Berkshire retained after buying the property-and casualty insurer Alleghany—sometimes described as a miniature Berkshire-style investment holding company—last October. Some Berkshire observers think Buffett likely opted to liquidate all or most of Alleghany’s $2 billion portfolio, which included stocks such as
It also will be interesting to see if Berkshire picked up its pace of investments in the fourth quarter after a relatively inactive third quarter. Net purchases of stocks were about $4 billion, matching the level in the second quarter.
That was a contrast with the first quarter, when. Buffett and his investment lieutenants, Ted Weschler and Todd Combs, were net buyers of $41 billion of stocks including sizable purchases of
The biggest move in the third quarter was the purchase of 60 million shares of Taiwan Semiconductor, the big chip maker. That buy has been one of Berkshire’s better purchases in recent years because the stock, at $95, is up nearly 20% from its third-quarter average. That holding is now worth almost $6 billion.
Berkshire watchers wonder if the Taiwan Semi holding was initiated by Buffett or Combs or Weschler. Some think the size argues for Buffett since it would be large for Combs or Weschler, who together manage about 10% of the equity portfolio.
But semiconductors likely aren’t within Buffett’s range of expertise, arguing for Combs, Weschler, or a joint purchase. That question may be answered at Berkshire’s annual meeting in May.
Another point to watch is Berkshire’s holding of U.S. Bancorp. From the end of 2021 through November, Buffett’s company cut that stake by 63% to 52 million shares from 143 million at the end of 2021. When Buffett sells down formerly large holdings, he often eliminates them entirely, so it is possible that he did the same with U.S. Bancorp.
Berkshire has sold several formerly large bank holdings in recent years including JP Morgan,
Goldman Sachs Group
(WFC). All those sales were badly timed. Wells, for example, is trading for about double the price Berkshire likely received in 2020 and 2021.
It is possible that Berkshire added to its sizable stake in Paramount Communications (PARA). It owns 14% of the media company—91 million shares worth about $2 billion.
Berkshire may also have continued to pare its holding in
(ATVI), the videogame maker whose deal to be purchased by Microsoft is on the ropes after antitrust objections. Activision trades at $75.65, way below Microsoft’s takeover offer of $95. Berkshire held 60 million shares on Sept. 30, down eight million shares in the quarter. That stake is worth about $4.5 billion.
Buffett bought it as an arbitrage play given the wide discount to the deal price, but Berkshire likely is in the red on its holding.
Finally, Berkshire may have continued to add to its position in Chevron (CVX). It bought about $500 million of the stock in the third quarter and owned about 170 million shares, now worth about $29 billion, at the end of September.
Berkshire now has a 9% stake in the oil company and is its largest holder. A move to 10% would trigger a requirement that it promptly disclose sales and purchases.
Write to Andrew Bary at [email protected]
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