© Reuters. FILE PHOTO: The Berkshire Hathaway logo is displayed on a screen on the floor of the New York Stock Exchange (NYSE) in New York City, US, May 10, 2023. REUTERS/Brendan McDiarmid
By Jonathan Stempel
(Reuters) – Berkshire Hathaway revealed Monday that it has begun investing in it Capital One Financial Corp (NYSE:) exited investments in four other stocks, as the Warren Buffett-run company reduced its exposure to the stock.
Buffett’s company made its disclosures in a regulatory filing that records its shares traded in the United States as of March 31.
Shares of Capital One rose 5.7% in after-hours trading after Berkshire disclosed 9.92 million shares worth about $954 million.
McLean Bank, Virginia, did not immediately respond to requests for comment.
In a filing on Monday, Berkshire also disclosed a new $41.3 million stake in Diageo (LON: Plc), maker of alcoholic beverages including Johnnie Walker and Guinness.
Berkshire also divested its stakes in Bank of New York Mellon (NYSE:) Corp and US Bancorp (NYSE:), as well as Taiwanese TSMC and furniture maker and furniture chain RH (NYSE:).
Buffett’s company was a net seller of shares in the quarter, buying $2.87 billion and selling $13.28 billion as it devoted resources elsewhere, including $8.2 billion to increasing its stake in truck stop operator Pilot Travels to 80% from 38.6%.
Almost half of the sales of its shares were in chevron Corp (NYSE:), although Berkshire still owns a 23.7% stake in another oil company, Occidental Petroleum Corp (NYSE:).
The Omaha, Nebraska-based conglomerate finished March with $130.6 billion in cash and cash equivalents.
Monday’s filing does not indicate which investments are Buffett’s and which are his portfolio managers Todd Combs and Ted Wechsler, although the larger investments are usually Buffett’s.
Investors often try to undo Berkshire’s moves, reflecting on Buffett’s reputation.
BERKSHIRE BUYS MORE APPLE, BANK OF AMERICA
Despite the sale, Berkshire is still investing in several financial services companies.
These companies include Bank of America Corp (NYSE:) and American Express (NYSE: Corp), with stakes in Berkshire at $29.5 billion and $25 billion in its largest holdings other than a $151 billion stake in Apple Inc (NASDAQ:).
Berkshire bought more shares of Apple and Bank of America in the quarter.
“Credit banks like BNY Mellon have seen deposit pressures mount as the (US Federal Reserve) shifts to quantitative tapering,” said David Smith, analyst at Autonomous Research.
In contrast, the higher-yielding assets of credit card professionals such as Capital One better position them to absorb rising funding costs and avoid liquidity concerns.
Berkshire also has dozens of operating companies including BNSF Rail, Geico Motor Insurance, and several energy, manufacturing and consumer units.
Buffett gave up the remaining stake in TSMC six months after surprising investors by revealing a $4.1 billion investment.
He told investors this month that he had re-evaluated the risks of investing in Taiwan, due to growing concern that China might soon invade or try to retake the island nation.
