Berkshire Hathaway Q4 2021 13F: Buffett continues to surprise
Berkshire Hathaway posted its fourth quarter 13F yesterday after markets closed. The deposit has many surprises in store for the markets.
Berkshire Hathaway has made many surprise decisions over the past two years and the fourth quarter was no exception. The company led by Warren Buffett made a large investment in Verizon during the quarter.
Berkshire Hathaway cuts stake in Apple
Berkshire Hathaway sold 57.16 million Apple shares in the fourth quarter of 2021. However, Apple continues to be the company’s largest stake, accounting for more than 43% of its total holdings in publicly traded companies.
Warren Buffett started buying Apple broth in 2016 and gradually increased participation. However, the company has not contributed any Apple shares since the third quarter of 2018. Buffett did not buy more Apple shares in the fourth quarter of 2018, even though shares fell more than 30% during the quarter. The Oracle of Omaha, as Buffett is called, expected better prices but the markets did not grant him the wish.
Since the third quarter of 2018, Berkshire Hathaway has gradually reduced its stake in Apple. However, Apple continued to be the largest stake in the company’s portfolio and became Apple’s second largest shareholder.
Berkshire Hathaway Q4 2021 13F
Berkshire Hathaway unveiled $ 8.6 billion stake to Verizon. The company also added shares of Chevron in the fourth quarter and held $ 4.1 billion in Chevron at the end of 2021. Another new investment disclosed by Berkshire Hathaway was insurance broker Marsh & McLennan, where it held a stake of $ 499 million at the end of 2021. The company had started buying these companies only in the third quarter of 2021, but they were being kept under wraps. The holdings were not revealed until the fourth quarter 13F. Besides these companies, Berkshire Hathaway also opened a new position in EW Scripps.
Verizon is now Berkshire Hathaway’s sixth largest stake
Verizon is now the sixth largest company in the Berkshire Hathaway portfolio. Historically, consumer companies and financial services have been Warren Buffett’s main holdings. Buffett also sees Apple as a consumer company, not a tech company.
However, the COVID-19 pandemic appears to have changed that. Berkshire Hathaway left JP Morgan Chase, M&T Bank and PNC Financial Services completely during the quarter. It also sold over 58% of the shares it held in Wells Fargo.
Berkshire Hathaway has gradually reduced its holdings in bank stocks. Over the past year, he completely left his position in Goldman Sachs and reduced his stake in Wells Fargo. However, he added more Bank of America shares during the period.
Berkshire Hathaway also abandoned its investment in Barrick Gold. The company only added Barrick Gold in the second quarter of 2021, but only sold some shares in the following quarter.
Usually he holds long term stocks. However, there have been instances where the company sold shares much earlier. Aside from Barrick Gold, the company left Oracle shares in 2018 less than a quarter after buying the stake. In particular, Berkshire Hathaway’s investment in Barrick Gold surprised the markets because Buffett has a very pessimistic view of gold.
According to Buffett, gold “does nothing but sit there and look at you.” He also scoffed at the long-term performance of the precious metal where it significantly underperformed the S&P 500.
Other purchases and sales for Berkshire Hathaway
Berkshire Hathaway also left the position in Pfizer that he had taken last year alone. However, he added more shares from Merk, T-Mobile and AbbVie Inc, Kroger, RH and Bristol-Myers Squibb. The company only added HR shares in 2019 and continued to increase its stake.
Meanwhile, despite spending billions of dollars buying stocks and repurchasing stocks, Berkshire Hathaway continues to sit on huge cash.
Other surprise moves from Berkshire Hathaway in 2021
Last year, Buffett made several surprise actions. For starters, the company was a net seller of stocks in the first and second quarters of 2021. While Buffett has long preached about being greedy when others are afraid, he apparently didn’t follow his own advice. last year.
In another surprise move, Buffett left stakes in all four airlines in 2021 with a massive loss. In August 2021, Warren Buffett made another surprise move and took a passive 5% stake in five major Japanese trading companies, valued at over $ 6 billion at the time.
Buffett took stakes in Japanese companies in 2021
The five companies Sumitomo Corp, Itochu Corp, Mitsui & Company, Marubeni Corp and Mitsubishi Corp are known as “sogo shosha” and import food, metals and textiles. Although Berkshire Hathaway has made gains on investments in these companies, they are underperforming the Nikkei Index which is trading at multi-year highs.
Meanwhile, last year, Berkshire Hathaway invested in the IPO of cloud firm Snowflake. The move surprised the markets as Buffett has a very pessimistic view of IPOs and has also refrained from investing in technology companies.
Berkshire Hathaway vs. S&P 500
Berkshire Hathaway stock has significantly underperformed the S&P 500 in 2019 and 2021. According to Buffett, retail investors who don’t have the time and skills to invest directly in stocks should opt for an S&P 500 index fund or an ETF.
As an alternative, you can look at ETFs like the SPDR S&P 500 ETF which invests in S&P 500 companies.
With an S&P 50 ETF, you can diversify your risk across many companies instead of just investing in a few stocks. By investing in an ETF, you get returns linked to the underlying index after taking into account fees and other transaction costs. There is also a guide on how to trading ETFs.