2008-02-16 18:02:41
Warren Buffett Increasing His Exposure to US and International Equities?
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What's that line that Warren Buffett has?
"Be fearful when people are greedy and be greedy when people are fearful?"
It would seem that Buffett has started to move into "greedy" mode as it was revealed on Friday that he has increased holdings in a number of US company and initiated a new purchase in another. All told, Berkshire Hathaway increased its holdings in seven companies and decreased its holdings in two companies, while initiating a new position in two others.
Based on these moves, I would have to assume that Buffett thinks that the market is significantly "rattled" right now due to the worries over the economy and housing market, and is starting to put some of his significant sums of cash within Berkshire Hathaway to work.
Let's start with the two holdings that Buffett reduced his exposure to. That was Ameriprise Financial (AMP) and Iron Mountain (IRM).
Buffett initiated a new position in GlaxoSmithKline (GSK), purchasing approximately 1.51 million shares of the company. He also purchased an 11 million share stake in Trane (TT).
The companies that Berkshire Hathaway increased its exposure to?
Kraft (KFT), Wells Fargo (WFC), CarMax (KMX), Burlington Northern (BNI), US Bancorp (USB), Johnson & Johnson (JNJ) and Sanofi Aventis (SNY).
Berkshire Hathaway is now KFT's biggest shareholder with a 132.4 million share stake in the company, which is valued at over $4 billion dollars.
This represents a fairly comprehensive cross-section of different equities, which leads me to believe that Buffett believes that the market is presenting some strong value for investors and may be undervalued.
Buffett, easily the greatest investor of our time and any other time, is rarely wrong and if he senses that this is a time to buy, then it is probably a time to buy.
Berkshire Hathaway Files Holdings Report
Buffett on the Prowl
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