EUR 850.00 For Business Accounts Only

Morningstar | Berkshire's Purchase of Additional Apple Shares Keeps Tech Giant at Top of Firm's Equity Holdings

There were few surprises in wide-moat-rated Berkshire Hathaway's second-quarter 13-F filing. The sale of Monsanto, which was acquired by Bayer for $128 per share in early June, netted the firm around $2.4 billion, and the insurer's sale of 4.5 million shares of Wells Fargo (for an estimated $240 million) was part of efforts to keep Berkshire's ownership stake in the bank below the 10% threshold. The insurer also reduced its stake in Phillips 66 by 24%, selling 11.0 million shares (for an estimated $1.1 billion). This followed a sale of $3.3 billion of stock back to that company during the first quarter. Berkshire also eliminated the rest of its holdings in Verisk Analytics (for an estimated $30 million), having blown out 80% of its holdings in the firm during the March quarter, and trimmed its stake in Charter Communications (netting an estimated $215 million for 0.7 million shares).

The company used the sale of 1.3 million shares of American Airlines (for an estimated $60 million) and 1.0 million shares of United Continental (for an estimated $70 million), as well as proceeds from the sales mentioned above, to purchase another 10.1 million shares of Delta (for an estimated $525 million) and 8.9 million shares of Southwest (for an estimated $480 million), which moved Berkshire's ownership stake in each of the domestic airlines to around 10%.

Berkshire also increased its stake in Apple, acquiring another 12.4 million shares (for an estimated $2.2 billion), lifting its ownership stake to just over 5% of the technology company's outstanding shares. Other major purchases included the acquisition of another 2.3 million shares of Goldman Sachs (for an estimated $540 million) and 9.8 million additional shares of US Bancorp (for an estimated $500 million). Berkshire also made smaller additions to Bank of New York Mellon, Teva Pharmaceutical, General Motors, Liberty Global and Axalta Coating Systems during the second quarter.

Overall, it looks like the company netted an estimated $4.2 billion for its sales during the period, while spending more than $4.5 billion on the purchase of additional shares of companies that were already in the equity investment portfolio. These changes in the portfolio, as well as market movements, during the June quarter had a slight impact on Berkshire's top stock holdings. At the end of the second quarter, the company's top five positions--Apple (23.8%), Wells Fargo (12.8%), Kraft Heinz (10.5%), Bank of America (9.8%) and Coca-Cola (9.0%)--accounted for 65.9% of its $195.6 billion portfolio, and its top 10 holdings--which included American Express (7.6%), US Bancorp (2.6%), Moody's (2.2%), Phillips 66 (2.0%) and Bank of New York Mellon (1.8%)--accounted for 82.0%.