Buffett's Berkshire Hathaway Reveals 8.6% Stake in Kraft Foods - Warren Buffett Watch

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Feb.14

5:40 PM ET

Thursday, 14 Feb 2008

Buffett's Berkshire Hathaway Reveals 8.6% Stake in Kraft Foods

Posted By:Alex Crippen

Topics:Warren Buffett

Berkshire Hathaway adds Kraft Foods to its holdings, joining Coca-Cola, Dairy Queen and See's Candies on Warren Buffett's plate.
AP
Berkshire Hathaway adds Kraft Foods to its holdings, joining Coca-Cola, Dairy Queen and See's Candies on Warren Buffett's plate.

Warren Buffett's Berkshire Hathaway has accumulated an 8.6% stake in Kraft Foods , totaling over 132 million shares as of the end of the fourth quarter on December 31. The stake was worth $4.3 billion on that date.

At today's closing price of $29.31, it's worth about $3.9 billion. Kraft shares have been under pressure from rising agricultural commodity prices. They're down 9.8% in the last month, 11,7% year-to-date, and 14.2% over the last 12 months.

Kraft's current price: [KFT Loading... () ]

We got a hint of Buffett's interest in Kraft last July when the Wall Street Journal reported Berkshire had acquired a "small stake" in the company. It was seen at the time as a possible vote of confidence in Kraft's turnaround strategy. Activist investor Nelson Peltz had been pushing Kraft to sell some businesses to pay for a stock buyback.

Investor Takeaway

Berkshire revealed in SEC filings today that it was buying Kraft as early as the second quarter. It held 69,583,800 shares worth $2.5 billion as of June 30. Berkshire then increased its stake to 107,200,900 shares worth $3.7 billion as of September 30.

Berkshire's reported Kraft stake is its sixth largest by market value, following Coca-Cola ($11.7 billion), Wells Fargo ($8.6 billion), Procter and Gamble ($7.0 billion), American Express ($6.9 billion), and Burlington Northern Santa Fe ($5.7 billion.)

EXPLORE WARREN BUFFETT'S INVESTMENTS WITH OUR NEW BERKSHIRE HATHAWAY PORTFOLIO TRACKER

The snapshot of Berkshire Hathaway's portfolio holdings comes from an SEC filing late this afternoon. Berkshire, like other large holders, reports its portfolio holdings to the government four times each year. It reflects what Berkshire had on the last day of the fourth quarter, which was December 31, 2007. It may not be a complete list, as the SEC sometimes gives Berkshire and others permission to temporarily withhold some information to deter copy-cats.

BUFFETT'S OTHER MOVES

Berkshire also says it had 1.5 million shares of the British drug company GlaxoSmithKline, worth about $76 million as of the end of the fourth quarter. That's a new position for Berkshire.

Glaxo's current price: [GSK Loading... () ]

Berkshire's CarMax stake jumped to 21 million shares from 14 million at the end of the third quarter. Shares of the used-car retailer rallied over 6 percent back in November when Berkshire first revealed it had bought a stake. (Carmax's new Omaha location is now open!)

CarMax's current price: [KMX Loading... () ]