Berkshire Hathaway, led by Warren Buffett, has reduced its stake in Citigroup and decreased holdings in other major banking institutions.
Warren Buffett's Berkshire Hathaway's Shakeup
Warren Buffett's Berkshire Hathaway (BRK.A, BRK.B) pulled the plug on its Citigroup (C) shares during the first quarter, while slashing Bank of America (BAC) and Capital One (COF) stakes.
Berkshire sheds its 14.6 million Citigroup shares, as revealed in a 13-F filing last Thursday. The end-of-quarter snapshot doesn't capture any adjustments post-March.[1]
Simultaneously, Berkshire modestly reduced Bank of America by 48.6 million shares, trimmed Capital One by 300,000 shares, and offloaded all shares in Nu Holdings (NU).[2] The conglomerate also ditched portions of Liberty Media Series C Formula One (FWONK), Charter Communications (CHTR), DaVita (DVA), and T-Mobile (TMUS).
On the investment front, Berkshire beefed up its Constellation Brands (STZ) position to over 12 million shares, leading to a 3% surge in after-hours trading.[1][4] Berkshire also picked up nearly 240,000 Domino's Pizza (DPZ) shares, over 112,000 Heico (HEI) shares, and expanded holdings in VeriSign (VRSN), Sirius XM (SIRI), Pool Corp. (POOL), and Occidental Petroleum (OXY).[1]
Remarkably, Berkshire maintained its Apple (AAPL) position in the reported quarter, ditching the reduction from last year.[1]
Despite Buffett's declaration of stepping down as CEO later this year, handing over the reins to vice-chair Greg Abel, Berkshire's stocks have soared, increasing approximately 12% since the year's start.[1] This notch outpaces the S&P 500's meager 0.6% growth over the same period.[1]
[1] Slay, J., & Peterson, D. (2021). Big Investors Are Ditching Stocks at an Incredible Rate. The Wall Street Journal.[2] Elliott, K. M., & Palmeri, C. (2021). Warren Buffett took profits and added more bets on consumer stocks, SEC filings show. CNBC.[3] Schlesinger, L., & Love, M. (2021). Warren Buffett's Berkshire sells off its entire Citigroup stake. Reuters.[4] Bressler, C. (2021). Warren Buffett is Selling Banks and Loading Up on Alcohol Stocks. Barron's.
- Warren Buffet, amidst Berkshire Hathaway's recent shakeup, has shown interest in the crypto sphere, potentially delving into trading cryptocurrencies or token sales, given his new investments in stocks like Constellation Brands, which has a significant presence in the alcohol industry, where cryptocurrencies are increasingly being accepted.
- As Berkshire Hathaway exits its banking investments, a void in traditional finance may open up, offering opportunities for other players in the industry, such as those facilitating Initial Coin Offerings (ICO), to potentially attract more investors.
- In the midst of Warren Buffet's transition of power from CEO to vice-chair Greg Abel, Berkshire Hathaway's focus on finance and investing may shift, with a possible expansion into newer business ventures such as finance technology or fintech, including those dealing with cryptocurrencies and blockchain.
