The Oracle of Omaha was making moves in the second quarter.
What stocks has Warren Buffett bought and sold lately? Each quarter, all fund managers with at least $100 million in assets must publicly disclose their stock holdings to the U.S. Securities and Exchange Commission via Form 13F, giving investors a rare peek behind the curtain of some of the world’s largest and most successful hedge funds. One of the most anticipated quarterly filings comes from Buffett and his $667 billion company Berkshire Hathaway Inc. (ticker: BRK.A, BRK.B). Here’s a look at 10 of the biggest changes the Oracle of Omaha made to Berkshire’s portfolio in the second quarter.
Bought: Occidental Petroleum Corp. (OXY)
Occidental Petroleum is one of the largest U.S. oil and gas companies, and oil and gas stocks have been top market performers in 2022. Buffett has held a stake in Occidental since Berkshire helped bankroll Occidental’s $38 billion acquisition of Anadarko Petroleum back in 2019. The latest 13F filing this week revealed Berkshire’s stake in Occidental has grown to more than 272.2 million shares worth about $16.3 billion, making OXY stock one of Buffett’s six largest stock holdings. Berkshire also holds 83.9 million warrants that can be redeemed for Occidental common stock at a price of $59.62 per share.
Bought: Ally Financial Inc. (ALLY)
Ally Financial is a financial holding company that specializes in auto financing and mortgage lending. Ally shares are down about 34% in the past year as supply shortages have hit the auto market and rising mortgage rates have weighed on the housing market. Buffett appears to see Ally’s weakness as a buying opportunity, and rising interest rates helped push Ally’s net interest margins higher by 49 basis points to 4.04% in the second quarter. Buffett added roughly 21 million shares to his Ally stake in the second quarter, bringing his total investment to 30 million shares worth about $1 billion.
Bought: Apple Inc. (AAPL)
In the second quarter, Buffett added another 3.8 million shares to his massive Apple stake, bringing his total investment up to more than 894.8 million shares worth a whopping $122.3 billion. Buffett first invested in Apple back in the first quarter of 2016. Today, Berkshire’s Apple stake is nearly four times as large as any of its other public stock holdings and represents nearly 40% of Berkshire’s total portfolio. Apple’s stock price has held up well in 2022, and it has been a home run investment since Buffett started buying in the first quarter of 2016.
Bought: Activision Blizzard Inc. (ATVI)
In January, Microsoft Corp. (MSFT) announced a $68.7 billion buyout deal for video game publisher Activision Blizzard at a price of $95 per share. At the time, Berkshire investors had no idea Buffett’s company had purchased nearly $1 billion of Activision Blizzard shares at an average price of about $77 just weeks before the deal was announced. With Activision shares still trading well below their $95 buyout price, Berkshire added more than 4 million shares in the second quarter, potentially as a merger arbitrage bet. Berkshire now holds 68.4 million shares of ATVI stock worth about $5.3 billion.
Bought: Chevron Corp. (CVX)
Buffett first invested in U.S. oil major Chevron in the fourth quarter of 2020. Since that time, the oil industry has been on a roller coaster ride. Buffett reduced his Chevron holdings in the first and second quarters of 2021, but a global energy crisis and Russia’s invasion of Ukraine sent crude oil prices soaring to 13-year highs in 2022. In response, Buffett more than tripled his stake in Chevron in the first quarter and added another 2.2 million shares in the second quarter, bringing his total stake up to 161.4 million shares worth about $23.3 billion.
Sold: General Motors Co. (GM)
Priced at just 5.7 times forward earnings, legacy automaker General Motors is exactly the type of value stock Buffett typically targets. Berkshire first bought shares of GM way back in the first quarter of 2012, a little over a year after it completed its initial public offering following its bankruptcy restructuring. After adding to his position in the first quarter of 2022, Buffett reversed course and sold more than 9.1 million GM shares in the second quarter. Even after the selling, Berkshire still holds 52.8 million shares of GM stock worth more than $1.6 billion.
Sold: U.S. Bancorp (USB)
Buffett has a long history of big bets on bank stocks. In the first quarter, Berkshire finally sold off its last remaining shares of Wells Fargo & Co. (WFC) after more than 20 years holding the stock, leaving U.S. Bancorp as Berkshire’s longest-running bank stock holding. Buffett first invested in U.S. Bancorp back in 2006, but he trimmed his stake by 5% in the second quarter. U.S. Bancorp is another classic Buffett value investment, trading at a forward earnings multiple of just 11. Berkshire still holds 119.8 million shares worth more than $5.5 billion.
Sold: Kroger Co. (KR)
Kroger is a leading grocery retailer. In June, Kroger reported fiscal first-quarter same-store sales growth of 4.1% and raised its full-year earnings guidance. Buffett is likely a fan of the company’s forward earnings multiple of just 11.9 and its outperformance relative to the rest of the retail sector over the past year. Buffett has taken a bit of profits on his Kroger stake for the past three quarters now, selling another 5.5 million shares in the second quarter. However, Berkshire still holds more than 52.4 million shares of Kroger stock worth nearly $2.5 billion.
Sold: Verizon Communications Inc. (VZ)
One of the least surprising Berkshire 13F disclosures was Buffett dumping his remaining Verizon Communications shares after selling more than 99% of his stake in the first quarter. Buffett first invested in Verizon in the third quarter of 2020 and amassed a stake worth more than $8 billion by the end of 2020. Verizon seemed like a typical Buffett value investment, trading at 8.6 times forward earnings and paying a 5.6% dividend. However, Buffett aggressively reversed course in 2022, selling 157.4 million VZ shares in the first quarter and the remaining 1.3 million shares in the second quarter.
Sold: Royalty Pharma PLC (RPRX)
Royalty Pharma is one of the largest buyers of royalties from pharmaceutical companies. Buffett has been active in the health care sector since the beginning of the COVID-19 pandemic, initially taking large stakes in companies like AbbVie Inc. (ABBV), Bristol-Myers Squibb Co. (BMY), Pfizer Inc. (PFE) and Merck & Co. Inc. (MRK) before exiting most of those positions. Royalty Pharma is the latest victim of Buffett’s selling. Berkshire bought 13.1 million shares of Royalty Pharma in the third quarter of 2021 but has since been steadily reducing its stake. Berkshire dumped nearly 1.5 million remaining shares in the second quarter, completely exiting the position.
10 stocks Warren Buffett just bought and sold:
— Bought: Occidental Petroleum Corp. (OXY)
— Bought: Ally Financial Inc. (ALLY)
— Bought: Apple Inc. (AAPL)
— Bought: Activision Blizzard Inc. (ATVI)
— Bought: Chevron Corp. (CVX)
— Sold: General Motors Co. (GM)
— Sold: U.S. Bancorp (USB)
— Sold: Kroger Co. (KR)
— Sold: Verizon Communications Inc. (VZ)
— Sold: Royalty Pharma PLC (RPRX)
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Update 08/16/22: This story was published at an earlier date and has been updated with new information.