Warren Buffett's Berkshire Hathaway releases its end-of-Q3 stock portfolio snapshot later today, but during his live appearance on Squawk Box this morning Buffett revealed its big secret: Berkshire has bought $10.7 billion worth of common stock in IBM , or 64 million shares at an average price of $170.
The stock is trading around $189 this morning, giving Berkshire a gain of more than 11 percent.
Most of the IBM buying was done in this year's second and third quarters.
Buffett also revealed he didn't do much selling of stocks in the third quarter.
Buffett's company now owns 5.4 percent of IBM but he doesn't intend to buy any more. "I wouldn't be talking about it if I did." Even so, he could resume buying if IBM's stock price goes down enough and Berkshire has enough money coming in.
Buffett says he started accumulating IBM shares in March with the goal to buy $10 billion worth of stock.
We've noted that Berkshire's 13-F filings for the first and second quarters said that some holdings were being kept confidential, and it appears this is the buying spree Buffett was keeping under wraps. (He doesn't want copycat buyers to drive up the price of a stock he's actively acquiring.)
Buffett says he has not talked to the company or current CEO Sam Palmisano about his purchases, but he thinks IBM has done an "incredible job" executing its long-term strategy, has an excellent "road map" for the future, and "respects" its shareholders by being honest with them and doing big stock buybacks. "They've done all kinds of things right."