3 stocks Warren Buffett is buying
Warren Buffett’s Berkshire Hathaway went on its biggest stock-buying spree since 2008 in the first quarter, boosting its stake on Chevron, Activision and Apple. But the billionaire isn’t sold on investing in bitcoin. Read on to find out why.
Shareholders flocked to Omaha, Nebraska over the weekend to get a glimpse of how Warren Buffett is navigating the stock market downturn. The billionaire’s Berkshire Hathaway took advantage of declining share prices to boost its stake in Apple, while adding to its holdings in Chevron and Activision.
The conglomerate increased its investments in equity securities to $390.5 billion in the first quarter from $350.7 billion in the fourth quarter, according to its filing with the Securities and Exchange Commission. Net purchases totaling $41 billion in the first three months of the year represent the company’s biggest stock-buying spree since 2008, according to Bloomberg.
That’s a turnaround for the conglomerate that has previously been hoarding more cash. At the company’s annual shareholder meeting, Buffett admitted missing the March 2020 bottom for stocks during the pandemic, saying he doesn’t have the power to predict exactly what will happen to the economy and the market. Still, he said “we’ve been reasonably good at figuring out when we’re getting enough for our money.”
If there’s a lesson for everyday investors in his example, it’s a simple one. In a down market, Buffett is leaning into stocks he believes in long-term. Plus, investing rather than cashing out.
How much Chevron did Warren Buffett buy?
Berkshire Hathaway’s SEC filing shows it owned $25.6 billion in Chevron shares at the end of the first quarter. That’s a big jump from the $4.5 billion reported in the company’s 13F filing on its holdings as of December 31.
The increase takes Chevron to Berkshire’s top four holdings, which include American Express, Apple and Bank of America. The stakes in the four companies account for about 66% of the aggregate fair value of Berkshire’s investments in equities, according to its filing.
Chevron has attracted investors as the rally in oil prices improved the company’s profit outlook. Last week, the oil giant reported that cash flow operations almost doubled to $8.1 billion from $4.2 billion a year earlier, as the company boosted oil production amid tightening global supply.
If you’re looking to follow Buffett’s footsteps and considering adding Chevron to your portfolio, see our dedicated guide on how to buy the stock.
How much Apple stock does Berkshire Hathaway own?
At the end of March, Berkshire Hathaway owned $159.1 billion Apple shares, according to the latest filing. While that’s down from $161.2 billion at the end of 2021, the decline is more a reflection of the slump in share prices.
Buffett told CNBC’s Becky Quick that he bought $600 million of Apple shares after a three-day decline in the stock last quarter. The 91-year old billionaire said he could have purchased more had the stock kept declining.
He may have returned to the market to pick up more of the stock. Apple shares fell last week after the company warned of as much as $8 billion hit on sales as a result of supply shortages. The stock extended its slide, trading 2.6% lower on Monday.
Still, 32 out of 38 analysts who track the shares have a strong buy or buy recommendation on the stock, while the remaining six say hold, according to Yahoo Finance.
The average target price on the stock is $191.70, representing further upside on the stock that was trading at $153.60 Monday afternoon. If you’re looking to take advantage of that upside potential, see our dedicated guide to buying Apple stock.
Activision shares climb as Berkshire Hathaway boosts stake
Buffett said Berkshire raised its stake in Activision Blizzard to 9.5%, from about 1.9% at the end of 2021 in a bet that Microsoft will complete its deal to buy the video-game maker. That helped push Activision shares higher, bucking the declining trend seen across US stocks.
While Activision rose 2.9% to $77.75 on Monday, that’s still well below the $95 a share price that Microsoft said in January it plans to pay for the acquisition.
Warren Buffett’s view on bitcoin
The billionaire who built his wealth by investing in stocks hasn’t warmed up to cryptocurrency, despite its growing popularity among institutional investors. Buffett told his company’s shareholders that he has no intention of adding bitcoin to Berkshire’s portfolio.
“If you told me you own all of the bitcoin in the world and you offered it to me for $25, I wouldn’t take it,” Buffett said. “It isn’t going to produce anything. The apartments are going to produce rent and the farms are going to produce food.”
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