by
Text size
Warren Buffet.
Bill Pugliano/Getty Images
What Warren Buffett and his colleagues were doing
Berkshire Hataway
up to their $350 billion equity portfolio last quarter? Investors will find out very soon.
A regulatory filing expected on Tuesday should lift the veil. Investors will focus on the fact that Berkshire Hathaway (ticker: BRK/A, BRK/B) has added to its holding in
Taiwan semiconductor manufacturing
(
TS extension
), as well as if the company continued to scale back its longtime interests in
U.S. Bancorp
(USB).
The fourth-quarter 13-F filing with the Securities and Exchange Commission is expected to include all the stock Berkshire retained after buying property and casualty insurer Alleghany, sometimes described as a miniature Berkshire-style investment holding company, the last october. Some Berkshire observers believe Buffett likely decided to liquidate all or most of Alleghany’s $2 billion portfolio, which included stocks like
JPMorgan Chase
(JP),
Roper technologies
(POR), e
Microsoft
(MSFT).
It will also be interesting to see if Berkshire picked up the pace of investment in the fourth quarter after a relatively inactive third quarter. Net stock purchases were approximately $4 billion, equal to the second quarter level.
This was a contrast to the first quarter when. Buffett and his investment lieutenants, Ted Weschler and Todd Combs, were net purchasers of $41 billion of stock, including sizable purchases of
Western oil
(OSSI) e
Chevrons
(CVX).
The biggest move in the third quarter was the purchase of 60 million shares of Taiwan Semiconductor, the major chip maker. That purchase was one of Berkshire’s best buys in years because the stock, at $95, was up nearly 20% from its third-quarter average. That stake is now worth nearly $6 billion.
Berkshire observers wonder whether the Taiwan Semi holding company was started by Buffett, Combs or Weschler. Some think the size is in Buffett’s favor since it would be large for Combs or Weschler, who together manage about 10% of the stock portfolio.
But semiconductors probably aren’t within Buffett’s purview, backing Combs, Weschler, or a joint buyout. That question can be answered at the Berkshire Annual Meeting in May.
Another point to watch is Berkshire’s stake in US Bancorp: From the end of 2021 to November, Buffett’s company reduced that stake by 63% to 52 million shares from 143 million at the end of 2021. When Buffett sells previously large holdings, he often eliminates them altogether, so it’s possible he did the same with US Bancorp.
Berkshire has sold several formerly large banking holdings in recent years, including JP Morgan,
Goldman Sachs Group
(GS) and
Well Fargo
(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 has increased its sizable stake in Paramount Communications (PARA). He owns 14% of the media company: 91 million shares worth about $2 billion.
Berkshire may also have continued to reduce its holding
Activision Blizzard
(ATVI), the video game maker whose deal to be bought by Microsoft is on the ropes after antitrust objections. Activision is trading at $75.65, far below Microsoft’s takeover offer of $95. Berkshire held 60 million shares on Sept. 30, down eight million shares for the quarter. That share is worth about $4.5 billion.
Buffett bought it as an arbitrage play given the large discount on the deal price, but Berkshire is likely in the red on its stake.
Finally, Berkshire may have continued to increase its position in Chevron (CVX). It bought about $500 million of shares in the third quarter and owned about 170 million shares, now worth about $29 billion, at the end of September.
Berkshire now owns a 9% stake in the oil company and is its largest holder. A move to 10% would trigger the obligation to disclose sales and purchases in a timely manner.
Email Andrew Bary at [email protected]
