Buffet’s Berkshire Hathaway Portfolio Reshuffle
Tuesday, February 15, 2011 12:20 PM

I had a preliminary look at Warren Buffett's Berkshire Hathaway 13F-HR Q3 and Q2 filings. If you are a keen Buffett follower, for whatever reasons (such as adjusting your own portfolio or coming to know where the legend is increasing/decreasing stakes), then here we go.

At the end of December 2010, Berkshire Hathaway's portfolio value was $52.56 billion, compared to $48.56 billion at the end of September 2010 or $46.44 billion at the end of June 2010. This amounts to a quarterly portfolio return of 8.24% or annual return of 32.95%. Hathaway's portfolio OND quarter performance was better than JAS quarter performance (quarterly return of 4.57% or annual return of 18.28%). However, this compares poorly to S&P 500's quarterly return of 13.86% or annual return of 55.46%.

The guru seems to be reducing the diversity of portfolio as the number of positions declined to 21 at the end of December 2010, compared to 37 at the end of June or 33 at the end of September.

During the quarter ended June 30,2010, Berkshire didn't completely sell out positions in any of its portfolio while it sold out positions in five stocks during the quarter ended September 2010. Stocks which the guru eliminated altogether in Berkshire's portfolio include - The Home Depot, Inc. (NYSE:HD), Republic Services, Inc. (NYSE:RSG), CarMax, Inc (NYSE:KMX), Iron Mountain Incorporated (NYSE:IRM), and NRG Energy, Inc. (NYSE:NRG). During the quarter ended

December 2010, Berkshire Hathaway Inc. (NYSE:BRKa & BRKb) sold off its entire stake in eight companies including Bank of America Corp. (NYSE:BAC), Comcast Corp. (NYSE:CMCSA), Nalco Holding Co. (NYSE:NLC), Nike Inc. (NYSE:NKE), Nestle (NSRGY.PK), Fiserv Inc. (NYSE:FISV), Lowe's Companies Inc. (NYSE:LOW) and Becton Dickinson & Co. (NYSE:BDX). However, the company increased its stake in Wells Fargo (NYSE:WFC) to 342.62 million shares from 336.41 million shares in the previous quarter.

Buffett maintained his stakes in American Express Co. (NYSE:AXP), Coca Cola Co. (NYSE:KO), Comdisco Holding Co. Inc. (CDCOR.OB), ConocoPhillips (NYSE:COP), Costco Wholesale Corp. (NYSE:COST), ExxonMobil Corp. (NYSE:XOM), Gannett Co., Inc. (NYSE:GCI) and General Electric Co (NYSE:GE). He also maintained his holdings in GlaxoSmithKline plc (NYSE:GSK) , Ingersoll-Rand plc (NYSE:IR), Johnson & Johnson (NYSE:JNJ), Kraft Foods Inc. (NYSE:KFT), M&T Bank Corp. (NYSE:MTB), Procter & Gamble Co. (NYSE:PG), Sanofi-aventis SA (NYSE:SNY), Torchmark Corp. (NYSE:TMK), US Bancorp (NYSE:USB), United Parcel Service, Inc. (NYSE:UPS), Wal-Mart Stores, Inc. (NYSE:WMT) and Wesco International Inc. (NYSE:WCC).

If you have had been keenly following news/opinions regarding financial services industry, I wouldn't be surprised if you have had expected the guru to reduce Berkshire's portfolio exposure to financial services. However, the guru seems to be still bullish on some financial services stocks such as Wells Fargo (NYSE:WFC), American Express Co. (NYSE:AXP), and US Bancorp (NYSE:USB).

At the end of June 2010, Berkshire Hathaway's portfolio exposure to financial services stocks was 37.9% of total portfolio, second to consumer/non-cyclical stocks exposure at 39.9%. At the end of September 2010 and December 2010, financial services still accounted for the largest industry exposure in Berkshire Hathaway's portfolio.

Net on net, you may form a bearish view on the stocks eliminated by Berkshire Hathaway. You may also form a bullish view on Berkshire Hathaway's new positions/increased positions. However, I would end by saying that I need to probe further to form such opinion on these stocks.



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AnalystFirm NameSymbolEPS Estimate
ja teremtipTTG Investments GE$0.28
markinsurace guru CINF$0.36