Key Takeaways:
- Berkshire Hathaway spent of whopping $9 billion on stocks during the third quarter of 2022.
- Warren Buffett's long-term philosophy is to buy when others think you should sell, and visa-versa.
- Berkshire’s purchase of an additional 5.99 million shares of Occidental Petroleum hit a home run in profits for the company.
Warren Buffett’s Berkshire Hathaway bought $9 billion in stock in the third quarter while dumping $5 billion.
Berkshire Hathaway opened big positions in Jefferies Financial Group, Louisiana-Pacific, and Taiwan Semiconductor Manufacturing.
Jeffries has a net worth of $8.59 billion, Louisiana-Pacific’s net income is $226 million, and Taiwan Semiconductor Manufacturing has a market cap of $377.54 billion; these are major players with solid track records.
Mr. Buffett has a classic investing technique that has earned him billions over the decades. His favorite method is to buy when everyone else fears buying and sell when everyone else feels more profits will be made.
Keep in mind “everyone else” is used as a figure of speech, but that is Mr. Buffett’s long-time approach. In Mr. Buffet’s exact words, be “fearful when others are greedy and greedy when others are fearful.”
Berkshire Hathaway bought $66 billion in stocks over the year’s first nine months; that is 13 times more spending than the same period in 2021.
The news of Berkshire Hathaway’s massive purchases was revealed after the company released its 13F filing. The US Securities and Exchange Commission (SEC) requires institutional investors managing more than $100 million to file a 13F within 45 days before the end of each quarter.
Large investment firms and hedge fund traders use these reports to gain an edge, as they can see where the big money is flowing.
The US stock market had a rough year due to the Federal Reserve’s struggle to curb inflation. Early in the year, stocks were soaring high and then began crashing hard in September; that is when the S&P 500 had its biggest monthly drop since the pandemic sell-off in 2020.
For Berkshire Hathaway, this was ripe for opportunity – the company has and probably always will thrive in these moments. Because energy stocks took a beating, Mr. Buffet seized the moment and aggressively started buying. Energy stocks have since recovered extremely well.
One example of Mr. Buffett’s mastery of the stock market is his investment in Occidental Petroleum (NYSE: OXY). Earlier this year, on Aug 4, the stock price was at a monthly low of $57.46. By Aug 29, the price climbed to a monthly high of $75.29.
At the end of September, shares dropped again to $57.88. Berkshire Hathaway jumped all over it, and today OXY trades near $73 per share.
By the way, Berkshire Hathaway bought 5.99 million shares of OXY during that scenario, adding to their present total of 194.4 million shares worth $14.2 billion.
Berkshire Hathaway followers hang on every stock move the company makes – and for good reason. Investors will soon see what 2023 holds for the 7th highest ranked company on the Fortune 500 list.
