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Executive Producer
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Warren Buffett's Berkshire Hathaway was doing more selling than buying of stocks during the second quarter, but there is one new holding.
In an SEC filing tonight, Berkshire reveals it held 1.2 million shares of the New Jersey-based medical technology company Becton Dickinson as of June 30. The stake was valued at $85.6 million on that date.
Becton's stock has dropped since then, bringing the current value of Berkshire's holding down to about $81 million.
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Becton Dickinson's 2009 second quarter closing low was $60.48 on April 30. |
That includes a small after-hours boost for the stock from Buffett's endorsement. It's rallied to $67.46 as of 5:30p ET, a 1.6 percent increase from today's 4p close of $66.39. [BDX
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In what may be an indication that Buffett sees opportunities in health care, Berkshire also raised its existing stake in Johnson & Johnson [JNJ
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] to 36.9 million shares from 32.5 million, an increase of 13.6 percent. That's the same percentage increase we saw for J&J in the first quarter of this year, but the stake is still well below the 61.7 million shares held at the end of September last year.
Buffett wrote in his annual letter to shareholders that Berkshire sold more than half its J&J shares in the fourth quarter to help raise money for the fixed-income securities it bought from Wrigley, Goldman Sachs [GS
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] and General Electric [GE
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While Berkshire was doing some buying, there's a longer list of stocks that got cut during the quarter.
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Berkshire slashed its stake in Home Depot [HD
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] by 25.5 percent to 2.758 million shares as of June 30.
For the second consecutive quarter, Carmax [KMX
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] was cut sharply. Berkshire reports holding 9 million shares, down 25 percent from the end of the first quarter, and a little more than half the 17.6 million shares it reported as of December 31.
Berkshire holdings of UnitedHealth [UNH
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] have also been reduced for the second straight quarter, down 24.4 percent to 3.4 million shares. The stake was reduced by almost 29 percent during the first quarter.
Berkshire also cut its holdings of Eaton [ETN
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] and Wellpoint [WLP
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We don't have a complete picture of Berkshire's stock holdings, and there could be a surprise to come. Tonight's filing specifically states that "confidential information has been omitted" and provided separately to the SEC.
Buffett sometimes gets permission to do this when Berkshire is building a position in a stock. The secrecy is designed to prevent copycats from buying the same stock, driving up its price.
Berkshire has been concentrating on corporate and foreign-government fixed-income investments more than equities lately, buying only $350 million worth of stock during the second quarter versus $2.55 billion of fixed-income.
American University Finance Professor Gerald Martin told Bloomberg it's a way for Berkshire to reduce its risk: "Some of the normal places he’s gotten the cash to invest are just getting killed in the recession. So he’s locking in these guaranteed returns, moving from the volatility of stocks to a steady stream of income that, in some cases, is almost at the return you normally get from the stock market.”
Data is a real-time snapshot *Data is delayed at least 15 minutes