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.
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. .
In what may be an indication that Buffett sees opportunities in health care, Berkshire also raised its existing stake in Johnson & Johnson 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 and General Electric .
While Berkshire was doing some buying, there's a longer list of stocks that got cut during the quarter.
Berkshire slashed its stake in Home Depot by 25.5 percent to 2.758 million shares as of June 30.
For the second consecutive quarter, Carmax 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 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 and Wellpoint .
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.”
Here are the details from tonight's Berkshire Hathaway portfolio snapshot as of June 30, 2009, compared to the filing for March 31, 2009:
- Becton Dickinson added at 1.2 million shares.
- Constellation Energy eliminated. Berkshire disclosed on June 1 it had sold all of the 14,828,207 shares it reported holding as of March 31.
- Johnson & Johnson stake increased 13.6% to 36,914,633 shares from 32,508,891 shares.
- Carmax stake decreased 25.0% to 9,000,000 shares from 12,000,000 shares.
- ConocoPhillips stake decreased 9.5% to 64,485,759 shares from 71,228,096 shares. In its first quarter earnings news release in May, Berkshire said it had sold 13.7 million shares during the January-March quarter and "additional shares were sold subsequent to the end of the quarter."
- Eaton Corp. stake decreased 37.5% to 2,000,000 shares from 3,200,000 shares.
- Home Depot stake decreased 25.5% to 2,757,898 shares from 3,700,000 shares.
- UnitedHealth Group stake decreased 24.4% to 3,400,000 shares from 4,500,000 shares.
- American Express unchanged at 151,610,700 shares.
- Bank of America unchanged at 5,000,000 shares.
- Burlington Northern unchanged at 76,777,029 shares.
- Coca-Cola unchanged at 200,000,000 shares.
- Comcast unchanged at 12,000,000 shares.
- Comdisco unchanged at 1,538,377 shares.
- Costco Wholesale unchanged at 5,254,000 shares.
- Gannett unchanged at 3,447,600 shares.
- General Electric unchanged at 7,777,900 shares.
- GlaxoSmithKline unchanged at 1,510,500 shares.
- Ingersoll-Rand unchanged at 7,782,600 shares.
- Iron Mountain unchanged at 3,372,200 shares.
- Kraft Foods unchanged at 138,272,500 shares.
- Lowes Companies unchanged at 6,500,000 shares.
- M&T Bank unchanged at 6,715,060 shares.
- Moody's unchanged at 48,000,000 shares. On July 22, after the end of the second quarter, Berkshire disclosed that it had cut its stake in Moody's by 16.6 percent to 40,013,700 shares.
- Nalco Holding unchanged at 9,000,000 shares.
- Nike unchanged at 7,641,000 shares.
- Norfolk Southern unchanged at 1,933,000 shares.
- NRG Energy unchanged at 7,200,000 shares.
- Procter & Gamble unchanged at 96,316,010 shares.
- Sanofi Aventis unchanged at 3,903,933 shares.
- SunTrust Banks unchanged at 3,204,600 shares.
- Torchmark unchanged at 2,823,879 shares.
- US Bancorp unchanged at 69,039,426 shares.
- USG unchanged at 17,072,192 shares.
- Union Pacific unchanged at 9,558,000 shares.
- United Parcel Service unchanged at 1,429,200 shares.
- Wabco Holdings unchanged at 2,700,000 shares.
- Wal-Mart Stores unchanged at 19,944,300 shares.
- Washington Post unchanged at 1,727,765 shares.
- Wells Fargo unchanged at 302,609,212 shares.
- Wellpoint stake unchanged at 4,777,300 shares.
- Wesco Financial unchanged at 5,703,087 shares.
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