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Buffett Is Selling

By April Taylor - Updated Apr 6, 2017 at 1:15PM

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Keeping up with the Oracle.

Berkshire Hathaway's (NYSE: BRK-A) (NYSE: BRK-B) Warren Buffett has been a seller in the most recent quarter. That's the headline from the quarterly SEC filing revealing Berkshire Hathaway's securities holdings. Buffett reduced his stake in 13 holdings, with four being eliminated from the portfolio altogether.

Sizeable sales
Buffett's most substantial sales were Kraft and Procter & Gamble.

Company

No. Shares Sold Q1 2010

% Share Decrease vs. Q4 2009

Estimated $Sale Proceeds*

Shares Held by Berkshire Hathaway 3/31/10

Kraft Foods
(NYSE: KFT)

31.5 million

23%

$908.3 million

106.7 million

Procter & Gamble (NYSE: PG)

8.4 million

10%

$527.9 million

79.1 million

*Based on average close price for Q1 2010.
Source: Company reports, Yahoo! Finance.

Buffett expressed dismay at Kraft's deal to acquire Cadbury, describing it as "dumb" at the Berkshire annual meeting. The sale points to putting his money where his mouth is, though Berkshire's stake in Kraft remains large. Of course, the Kraft and Procter & Gamble sales may be nothing more than a tax-efficient way to replenish cash coffers following the Burlington Northern acquisition; Berkshire does not have large, unrealized gains in Kraft and Procter & Gamble. 

Spring cleaning
In addition to the major sales shown above, Buffett eliminated holdings of health insurers, Wellpoint and UnitedHealth, from the portfolio. The remaining SunTrust Bank shares were sold, as was a small stake in Travelers.

The three buys
Amid all the selling, Buffett added to positions in Becton Dickinson, Iron Mountain, and Republic Services.  

Company

No. Shares Bought
in Q1 2010

% Share Increase
vs. Q4 2009

Shares Held by Berkshire
Hathaway 3/31/2010

Becton Dickinson (NYSE: BDX)

244,128

16%

1.7 million

Iron Mountain (NYSE: IRM)

794,800

11%

7.8 million

Republic Services (NYSE: RSG)

2.5 million

31%

10.8 million

Source: Company reports, Yahoo! Finance.

At over $322 million, Berkshire's stake in garbage hauler Republic Services is the largest of the three holdings, and it captured the lion's share of Buffett's reported buying. While modest currently, Berkshire's stake in Republic could become more significant, as it has Buffettesque qualities -- limited competition, and route system driven economies of scale reminiscent of Burlington Northern. Interestingly, Buffett friend and Berkshire board member, Bill Gates has an interest in Republic as well. Gates' charitable foundation and private investment vehicle, Cascade Investments, own about 15% of the company, so Buffett's influence over the company may exceed Berkshire's 2.8% ownership. 

A surprise yet to come?
Finally, it is important to note that Berkshire's Q1 2010 cash flow statement suggests more equity securities buying -- $1.6 billion, to be exact -- than the purchases of Becton Dickinson, Iron Mountain, and Republic reflect. The Oracle of Omaha may have a surprise up his sleeve. A foreign equity is one possibility -- the quarterly SEC filing of securities holdings excludes foreign securities not traded as ADRs on a U.S. exchange.

Thoughts on Buffett’s moves? A theory on his mystery stock(s)? Fire away in the comments section below.

More on Berkshire Hathaway and Buffett:

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Stocks Mentioned

Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
BRK.A
$456,500.00 (0.10%) $468.99
Kraft Foods Group, Inc. Stock Quote
Kraft Foods Group, Inc.
KRFT.DL
Berkshire Hathaway Inc. Stock Quote
Berkshire Hathaway Inc.
BRK.B
$304.05 (-0.03%) $0.10
The Procter & Gamble Company Stock Quote
The Procter & Gamble Company
PG
$141.79 (0.06%) $0.09
Republic Services, Inc. Stock Quote
Republic Services, Inc.
RSG
$129.45 (1.52%) $1.94
Becton, Dickinson and Company Stock Quote
Becton, Dickinson and Company
BDX
$252.30 (0.46%) $1.16
Iron Mountain Incorporated Stock Quote
Iron Mountain Incorporated
IRM
$49.49 (1.77%) $0.86

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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