On December 13th local time, Berkshire Hathaway, a subsidiary of Warren Buffett, submitted a document to the US Securities and Exchange Commission (SEC) stating that Berkshire had once again increased its holdings in Western Oil Company this week, with its stake having risen to over 27%.
According to the documents, Berkshire has increased its holdings in Western Oil stocks for three consecutive days this week, buying nearly 10.5 million shares of Western Oil Company for approximately $588.7 million (approximately RMB 4.2 billion).
After this increase in holdings, Berkshire's holdings of Western Petroleum common stocks increased to 238 million shares, with a shareholding ratio of over 27.13% and a total market value of approximately $14 billion (approximately RMB 100 billion).
In addition, Berkshire also holds preferred shares and warrants of Western Oil, which can be exchanged for 83.8 million shares of Western Oil Company stock for $4.7 billion ($56.62 per share).
It is worth noting that since the beginning of 2022, Berkshire has continuously increased its holdings in Western Oil's stocks and has become the single largest shareholder of Western Oil.
Berkshire's last disclosure of increased holdings in Western Oil was at the end of October this year. On October 25th, Berkshire increased its holdings of 3.9 million shares of Western Oil common stock, raising its stake to 25.8%, with a market value of approximately $14.4 billion at the time.
Despite Buffett's continuous buying, the stock price of Western oil has continued to decline. As of the close of Thursday Eastern Time, Western Oil closed at $58.76 per share, a cumulative decline of 5.6% for the year, and a cumulative increase of 22.9% for the S&P 500 index during the same period. The latest total market value of Western Petroleum is approximately 51.57 billion US dollars (approximately 370 billion yuan).
Just "cut the meat" to reduce holdings in HP
Market insiders say that compared to 2022, as the Fed's interest rate hike cycle approaches its peak, Buffett's trading style is leaning towards defense.
Recently, Buffett sold off PC giant HP. According to a regulatory document released on December 11th local time, Berkshire Hathaway has reduced its stake in HP to 5.2%. Analysts suggest that Buffett's possible intention is to liquidate his stake in HP.
At present, Berkshire still holds 51.5 million shares of HP stock, corresponding to a market value of approximately $1.55 billion, and remains the third largest institutional shareholder of HP, second only to BlackRock and Vanguard Group.
Market insiders have stated that Buffett has always adhered to the philosophy of long-term investment and value investment in his investments, and he has never blindly followed the trend or speculated to win. As a traditional personal computer manufacturer, HP has gradually encountered difficulties in its business after facing the impact of smartphones. Buffett may have concerns about HP's future growth potential and cash flow status, so he chose to reduce his holdings.
According to HP's latest financial report, due to the failure of the PC market growth rate to meet expectations, the fourth quarter sales performance was poor, and the company's revenue decreased by 6.5% year-on-year to $13.8 billion. In addition, HP's profit guidance for the first quarter of fiscal year 2024 was lower than Wall Street's expectations.
According to regulatory documents, as of the end of the third quarter of 2023, Berkshire's total holdings in the US stock market were $313.257 billion. Among the top ten holdings, Apple remains the largest heavy holding stock, accounting for 50% of Buffett's total holdings. Among the changes in the top ten heavily held stocks in the third quarter, Buffett significantly reduced his holdings of Chevron by 10%.
At the same time, Buffett's clearance of stocks also covers many industries, including Activision Blizzard, UPS, General Motors, snack manufacturer Yizi, chemical company Seranis, Procter&Gamble, and Johnson&Johnson. Among them, Procter&Gamble and Johnson&Johnson are stocks that Buffett has been holding for a long time.
In addition, as of the end of the third quarter of this year, Berkshire Hathaway's total cash reached $157.24 billion (approximately RMB 1148 billion), setting a new historical high. This also shows that Buffett's style is leaning towards conservatism, with almost no new trading opportunities discovered.
On November 21st local time, Buffett once again donated approximately $866 million in Berkshire stocks to four charitable organizations. On the same day, 93 year old Buffett issued a shareholder letter designating his children as executors of his will. After his death, more than 99% of his wealth will be donated to charitable organizations, and Berkshire already has a suitable CEO successor. He said, "I feel good, but I am fully aware that I have entered extra time."