Berkshire Hathaway, led by Warren Buffett, divested more than $36 billion in stocks in the third quarter of 2024. Insights into this selling frenzy can be gleaned from the company’s quarterly disclosures and SEC filings. By the end of the quarter, Berkshire valued its stake in Apple at approximately $69.9 billion, reflecting ownership of roughly 300 million shares.
This figure marks a decrease of 100 million shares compared to the end of June. Based on Apple’s stock performance throughout the quarter, it is estimated that around $22.5 billion of the divestment originated from Apple. Additionally, SEC documents reveal that Berkshire sold about 235.17 million shares of Bank of America in the third quarter, amounting to $9.61 billion.
Given Berkshire’s significant investment in Bank of America, any transactions involving its shares must be disclosed through Form 4 within a two-day business window. The company also reduced its holdings in BYD, a China-based automaker, divesting 1,395,500 shares at an average price of HK$246.96 (about $31.76 USD per share), which generated proceeds of $44.3 million.
Berkshire reduces key positions
This sale seems to be a calculated effort to lower Berkshire’s ownership in BYD to below the 5% mark. Overall, roughly $32.15 billion of Buffett’s recent $36 billion selling activity can be linked to only three companies: Apple, Bank of America, and BYD. Such maneuvers underscore Buffett’s careful strategy in a climate of economic uncertainty.
The sale of shares in Apple and Bank of America by Berkshire could stem from an intent to realize considerable unrealized profits while corporate tax rates remain favorable. It may also align with a wider strategy aimed at bolstering cash reserves. Notably, despite the modest disposal, BYD continues to thrive, recording double-digit profit increases in the third quarter.
The liquidation of BYD shares appears to be a tactic to streamline reporting obligations. This substantial divestment may signify tactical repositioning by Berkshire Hathaway, potentially setting the stage for upcoming opportunities or preparing for fluctuations in the market. Investors who closely monitor Buffett will view these actions as telling indicators of his market perspective.
