Warren Buffett's Burlington Northern Railroad Stake Tops 20%


Warren Buffett's Berkshire Hathaway has increased its stake in Burlington Northern Santa Fe to over 20 percent with another options-related stock buy.

In its second SEC filing in three days, Berkshire reveals it bought a total of 2,217,500 shares on Thursday, December 11 for just over $167 million. Average price: $75.45, on a day the stock traded between $74.20 and $77.44.

That brings its total holdings in the freight railroad to 70,089,029 shares, or 20.47 percent of Burlington's stock.

It's a second set of option-related purchases. In October, Berkshire wrote put options on the shares, agreeing to buy them at a set price this month in exchange for a cash payment at the time. It's a form of insurance, designed to limit the potential losses of holding Burlington stock for the buyers of the options.


In an SEC filing on Wednesday, Berkshire said it bought 3.3 million shares on Monday and Tuesday as put options it wrote were exercised. (See the WBW post Warren Buffett's Burlington Northern Stake Rises To Almost 20% After Options-Related Stock Buy.)

Added together, Berkshire has bought 5,478,611 shares over four days, raising its stake from 18.9 percent as of the end of October to over 20 percent on Thursday.

The stock closed Friday at $71.38, much closer to its 52-week low of $68.31 in late November than its high of $114.58 in June. Current price:

It will be interesting to see if Buffett picks up even more shares as they fluctuate around $70. Most of the reported purchases since the summer of 2007 have been between $75 and $80.

Current Berkshire stock prices:

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