Moody's Stock Slide Could Slow Warren Buffett's Stake Sales In Near-Term
Warren Buffett's Berkshire Hathaway sold almost 800-thousand shares of Moody's this week, reducing its stake in the troubled credit rating agency slightly to 16.6 percent from 17.0 percent just over a month ago.
According to an SEC filing after yesterday's closing bell, Berkshire sold the shares in "multiple transactions" on Tuesday and Wednesday at prices ranging from $26.30 to $27.74 .. just before Moody's stock slid sharply on Thursday.
This latest round of selling, however, is just one-tenth the size of the almost eight million Moody's shares sold by Berkshire over three days in late July.
Berkshire remains Moody's largest shareholder with 39.2 million shares, worth about $951 million at last night's close of $24.26.
Most, if not all of this latest selling, appears to have come before the release late Wednesday of a court ruling that could make it harder for credit rating agencies to claim First Amendment protections for their opinions as they fight fraud claims against them over money-losing debt instruments.
Moody's shares fell over 7 percent yesterday (Thursday) on that news, a drop that could make additional Berkshire sales in the very near-term more unlikely.
I wouldn't be surprised, however, if sales resume should Moody's rebound to the high $20s, the level they were at when Berkshire sold in late July and earlier this week.
The stock was just coming off a one-month high when Berkshire started selling again on Tuesday.
Current Berkshire stock prices: