Big Changes Seen in Warren Buffett and Berkshire Hathaway Stock Holdings: Apple, BofA, IBM, Wells Fargo, Synchrony, Monsanto and More

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Berkshire Hathaway Inc. (NYSE: BRK-A) has released its public equity holdings as of September 30, 2017. Warren Buffett is one of the richest men alive, and he is also considered to be one of the greatest investors of the modern era.

24/7 Wall St. tracks many of the so-called “whale watching” trades made by America’s top investment managers, hedge fund managers and so forth. For most companies, there seems to be no greater endorsement in all whale-watching activities than to have a new stake held by Warren Buffett and Berkshire Hathaway.

In Berkshire Hathaway’s third-quarter earnings report, the entire base of all assets among all entities was $681.5 billion, up almost 10% year to date. The fair value of all equity securities was listed as $157.65 billion in the quarterly earnings report, with more than $82.2 billion being unrealized gains.

The Berkshire Hathaway quarterly SEC filing (13F) showed the balance as more than $177 billion of September 30.

24/7 Wall St. and its founders have tracked the major and minor portfolio changes from Mr. Buffett’s stock holdings for about two decades now. These have been tracked roughly every quarter, and despite some top positions never changing, there ends up being a large number of investment holdings that change over time.

The addition of two more portfolio managers in recent years has only made the changes look even more extreme over time.

Approximately 62% of the aggregate fair value was concentrated in the equity securities of just five companies:

  • American Express Co. (NYSE: AXP) was the same 151.6 million shares, valued at roughly $13.7 billion.
  • Apple Inc. (NASDAQ: AAPL) was listed as 3.9 million more shares at 134.09 million shares worth about $20.6 billion, versus the prior quarter 130.19 million shares.
  • Bank of America Corp. (NYSE: BAC) at $17.7 billion, after converting debt. This is considered a new stake but it was a known event. That stake is a massive 679,000,000 shares.
  • Coca-Cola Co. (NYSE: KO) was the same 400 million shares, valued at about $18.0 billion.
  • Wells Fargo & Co. (NYSE: WFC) was listed as being worth $26.9 billion. The Wells Fargo stake had been raised over and over through time, but after the accounts scandal Buffett trimmed the stake by 3.75 million shares to a stake of 464.2 million shares.

What was missing here in the largest holdings from prior quarters was the investment in International Business Machines Corp. (NYSE: IBM). Buffett had already shown in prior reports that he sold off some of the stake in Big Blue, and the value of that stake at the end of 2016 was $13.5 billion. This stake has been taken even lower to 37.03 million shares at the end of the third quarter, versus 54.08 million shares at the end of the second quarter.

Kraft Heinz Co. (NASDAQ: KHC) is also a continued massive holding that is outside of the normal book-keeping in the largest stock holdings. Berkshire currently owns 26.7% of the outstanding shares of Kraft Heinz common stock, with a carrying value of approximately $15.7 billion at the end of September. Its earnings determined under the equity method for the first nine months were $800 million in 2017 and $671 million in 2016, and Team Buffett received dividends of $594 million in the first nine months of 2017 and $561 million in the first nine months of 2016. In the first nine months of 2016, Berkshire Hathaway also received dividends of $180 million from its preferred stock investment, which Kraft Heinz redeemed for cash of $8.32 billion on June 7, 2016.

Several companies saw their stakes added to or saw some selling over the third quarter, seen as follows:

  • Synchrony Financial (NYSE: SYF) had previously been added as a new stake of about 17.5 million shares back in the second quarter (worth $521 million at that time), but another 3.34 million shares were added for a stake of just over 20.8 million shares.
  • Charter Communications Inc. (NASDAQ: CHTR) was a stake that was lowered to 8.49 million shares at the end of the third quarter from 9.44 million at the end of the second quarter.
  • Monsanto Co. (NYSE: MON) was a stake of 8.87 million shares, up from 8.04 million shares the previous quarter.
  • Wabco Holdings Inc. (NYSE: WBC) was already a small stake and it no longer appears in the portfolio.