Amazon Headlines Buffett’s Latest Portfolio Shakeup

By Glenn Dyer | More Articles by Glenn Dyer

Warren Buffett’s Berkshire Hathaway on Wednesday has confirmed finally that it has invested more than $US800 million in building a toehold in the share register of Amazon.

The stake was revealed in Berkshire’s March quarter 13F fund manager’s filing with the US Securities and Exchange Commission.

That report shows oil, airlines, technology, and banking remain the areas of interest for the billionaire and his small team of fund managers.

Buffett mentioned the Amazon stake in the week before the May 6 annual meeting of Berkshire, news that grabbed the attention of investors and moved it away from the billions of dollars of losses and bad publicity from Buffett’s support of the weakly performing Kraft Heinz company.

Berkshire has written down the value of its 26.67% stake in Kraft Heinz by $US3 billion and there are more to come with US market regulators probing the way that Kraft Heinz wrote down the value of its food assets in February. There is a suspicion the write-downs might not have been sufficient.

So it was very helpful for Buffett to tell CNBC that Berkshire has dabbled in Amazon shares. For most other investors buying more than $US800 million worth of shares in a company would be a major play, but it wasn’t.

Earlier this month Berkshire announced it was investing $US10 billion in the takeover offer from Occident (supported by Total of France) for US independent oil group, Anadarko.

Berkshire’s stake in Amazon was 483,300 shares at the end of the March quarter. The value of that stake was $US904 million by the closing on Wednesday, up from $US860 million at the end of March.

Berkshire Hathaway’s report also boosted its stake in America’s biggest bank, JP Morgan Chase by 18% to 59.5 million shares (worth more than $US6 billion) and a 22% increase to its holdings in software group Red Hat to 5.1 million shares.

Berkshire also boosted its stake in Delta by 5.3 million shares to 70.9 million shares, a position valued at $US3.7 billion at the end of the quarter.

Berkshire cut its Wells Fargo position by 16.9 million shares or 3%. Wells Fargo remained the third largest equity holding for Berkshire with 409.8 million shares, a stake valued at around $US19.8 billion at the end of the quarter.

Berkshire’s stake in American Express was the same 151.6 million shares as it has been for years. That’s 18.1% of Amex.

The stake in Apple was again listed as 249.59 million shares in the 13F filing, which was the same as the prior quarter but down marginally from the 252.47 million shares in September. Those shares were sold in an unrelated transaction. That stake is 5.4% of Apple.

Berkshire’s stake in Bank of America was unchanged at 896.17 million shares at the end of March from the end of 2018. That’s a 9.4% stake and the largest BofA shareholding.

The Coca-Cola Co was 400 million shares, a 9.4% stake.

The Kraft Heinz Co stake of 325.63 million shares was worth $US10.6 billion at the end of the first quarter. Berkshire has lost more than $US11 billion on that stake since 2015.

The holding in American Airlines Group was 43.7 million shares, the same as December but lower than the 44.7 million shares in September.

Bank of New York Mellon Corp. was 80.94 million shares at the end of March, but this was raised previously from 77.85 million shares at the end of September and from 64.8 million shares in June.

Still to be added is the $US10 billion of convertibles in Occidental Petroleum as part of the financing of that company’s bid for Permian basin oil group, Anadarko.

Buffett’s equity portfolio recovered in the March quarter (as the quarterly report released earlier this month showed). There were over $US15 billion in gains on the portfolio.

The SEC filing for the March 31, holdings showed almost $US199.5 billion (against versus more than $US183 billion at December 31, 2018) in direct equity holdings, not including convertibles and other related holdings.

Glenn Dyer

About Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.

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