Warren Buffett’s Berkshire Hathaway has been on a selling streak, reducing its stake in Bank of America for nine consecutive days. This suggests that the conglomerate is not just trimming its longtime holding, but potentially shifting its investment strategy. Over the past nine trading sessions, Berkshire has sold a total of 71.2 million shares of the bank, amounting to over $3 billion in sales.
Despite the selling spree, Berkshire still remains BofA’s largest shareholder with a 12.3% stake, owning a total of 961.6 million shares valued at $39.5 billion. However, if the conglomerate continues offloading its shares, Bank of America could potentially fall below third-place American Express as Berkshire’s equity holding.
Warren Buffett famously invested $5 billion in BofA’s preferred stock and warrants back in 2011, following the financial crisis. This move boosted confidence in the struggling lender, but it seems that Buffett is now choosing to sell off his stake in the bank. The cost basis of Berkshire’s position in BofA was approximately $14.15 per share or $14.6 billion at the end of 2021.
With Bank of America’s stock performing well in 2024, rallying 22% and outperforming the S&P 500, Berkshire could be looking to take profits from its investment. The bank closed on Monday at $41.09, prompting Berkshire to evaluate its holdings and potentially capitalize on the strong market performance.
Berkshire Hathaway is scheduled to release its second-quarter earnings on Saturday morning, which will provide further insight into the conglomerate’s investment decisions and its largest holdings. It remains to be seen whether Warren Buffett will continue the selling streak with Bank of America or if this is part of a larger strategic shift in Berkshire’s investment portfolio.
Warren Buffett’s Berkshire Hathaway’s continued selling streak with its Bank of America stake raises questions about the conglomerate’s investment strategies and its future plans. As one of the largest shareholders in BofA, Berkshire’s actions in the market will be closely watched by investors and analysts alike as they try to decipher the motives behind Buffett’s latest moves.
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