Berkshire Hathaway has cashed in at least $300 million in Tesla rival BYD stock in the past month – as Warren Buffett's 14-year bet continues to pay off
Berkshire Hathaway has cashed in at least $300 million of BYD stock in the past month.
The hedge fund has sold off more than 11 million shares in the Tesla rival since January 3.
Warren Buffett initially invested $232 million in the group in 2008, with his stake now worth $4.7 billion.
Berkshire Hathaway cashed in at least $300 million of stocks in Chinese EV maker BYD last month, as it continues to cut its 14-year holding in Tesla’s main Asian rival.
Warren Buffett’s investment firm announced in a Hong Kong Stock Exchange filing that it had sold off 1,554,500 shares in BYD on January 27, dropping its stake in the EV maker from 13.97% to 12.9%.
Those numbers, however, don’t fully capture Berkshire Hathaway’s BYD stock sales over January, because the company only has to file when a transaction changes its percentage stake by a whole number. Data from the filing suggests a total 11,714,858 drop in Berkshire’s BYD shares since its last announcement on January 3.
Warren Buffett’s luck changed this year, allowing him to spend a record sum on stocks and end his deal drought. Here are his 6 highlights of 2022.
Warren Buffett spent a record sum on stocks and made a major acquisition in 2022.
The Berkshire Hathaway CEO tore into bitcoin, adjusted some overseas bets, and gave a surprise gift.
Here are the investing icon’s 6 highlights of 2022.
Warren Buffett’s luck changed in 2022. After years of battling to find bargains and watching Berkshire Hathaway‘s cash stack up, the famed investor seized his chance to put his conglomerate’s mountain of money to work.
Buffett spent a record sum on stocks, executed a major acquisition, and made some striking changes to his overseas bets. He also crowed about four of Berkshire’s key holdings in his yearly letter, trashed bitcoin at the annual shareholders’ meeting, and made a surprise donation to his children’s charities.
Here are Buffett’s 6 highlights from 2022:
The annual letter
Buffett published his famous annual letter to Berkshire shareholders in February.
The investor vented his frustration with Berkshire’s mammoth $144 billion cash pile, blaming a lack of bargains in the stock market. He also celebrated the “Four Giants” among Berkshire’s businesses: insurance, railroads, energy, and its enormous Apple stake.
Moreover, Buffett appeared to respond to criticism of his tax practices by noting Berkshire paid $3.3 billion of federal income tax in 2021 — nearly 1% of all the corporate income taxes collected by the US government that year.
Buffett struck a deal to buy Alleghany for nearly $12 billion in March. Berkshire completed its takeover of the insurer in October, ending a years-long drought on the acquisition front.
The investor showcased his trademark approach to dealmaking, which prizes trust and simplicity. He proposed the merger over dinner with Alleghany’s CEO, who previously ran a Berkshire subsidiary, and the pair formally announced a deal less than two weeks later.
Buffet also refused to budge on the deal terms, and when Alleghany enlisted Goldman Sachs as a financial advisor, he insisted the investment bank’s fee was subtracted from Berkshire’s offer price.
An epic buying spree
Berkshire plowed a net $41 billion into stocks in the first quarter of 2022, setting a new record for its quarterly spending on equities.
Buffett and his team built large stakes in HP, Chevron, Occidental Petroleum, Citigroup, Paramount, and Taiwan Semiconductor in the first nine months of 2022. Berkshire also spent over $5 billion on buybacks and made other sizeable purchases, lifting its spending on stocks and acquisitions for the year to an astounding $70 billion or so.
The annual meeting
Buffett hosted Berkshire’s annual shareholder meeting in his hometown of Omaha, Nebraska in April, after two years of virtual gatherings due to the pandemic.
The investor called out the reckless speculation in the stock market, underlined the grave threat posed by inflation, and declared he wouldn’t pay $25 for all the bitcoin in the world.
Buffett made some big moves in 2022 that deserve special attention. For example, he poured a total of about $30 billion into Chevron and Occidental, propelling the pair of oil-and-gas companies onto the list of Berkshire’s most-valuable holdings.
The investor and his team also revealed in November they had boosted their billion-dollar bets on Japan’s five largest trading houses.
In contrast, they sold BYD shares for the first time in 14 years. Berkshire has now slashed its position in the Chinese electric-vehicle maker by around 22%, and pocketed an estimated $1.2 billion profit from the disposals.
An unexpected gift
Buffett made his usual annual donation of Berkshire stock in June, dividing the $4 billion gift between the Bill & Melinda Gates Foundation and four of his family’s charities.
Unexpectedly, he contributed a further $759 million worth of Berkshire stock to his three children’s foundations for Thanksgiving, saying he was proud of their charitable work and wanted to show his appreciation.
7/7 SLIDES
BYD’s lowest share price within that period was 201.6 Hong Kong Dollars ($25.70), meaning the investment firm has shed at least $301,071,850.60 of its stake in the company.
Load Error
Berkshire has been involved in a gradual selloff of its BYD holdings, trimming its stake from 21.07% to the latest reported level of 12.9% in the space of two years. Buffett’s investment firm has held a stake in BYD since 2008.
Shares in BYD are up about 30% so far this year on the Hong Kong Stock Exchange, while Tesla has jumped more than 67% on the NASDAQ. However, BYD’s losses last year of around 24% was much less severe than Tesla’s 69%.
BYD broke a record for EV sales in China last year, with its 1.9 million deliveries exceeding Tesla’s by 600,000 in the country, as the Shenzhen-based company shrugged off the negative impacts of COVID-19 lockdowns.
