- Warren Buffett's Berkshire Hathaway exited its Biogen and Axalta bets last quarter.
- Buffett's company slashed its pharmaceutical positions and sold some Chevron and GM stock.
- The investor and his team increased their stakes in Aon, Kroger, and RH.
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Warren Buffett's Berkshire Hathaway sold its stakes in Biogen and Axalta, trimmed its pharmaceutical bets, and added to a handful of positions in the second quarter, its latest portfolio update shows.
The famed investor's conglomerate may have cashed out its Biogen investment after the drugmaker's stock soared to a record high in June on the news that federal regulators had approved its controversial Alzheimer's treatment.
Berkshire cut its stakes in AbbVie by 10%, Bristol Myers Squibb by 15%, and Merck by 49% last quarter, despite only establishing those positions in the third quarter of 2020. Buffett and his team also dumped more than 80% of their Liberty Global stock, sold another 2% of their Chevron stake after halving it in the first quarter, and cashed in 10% of their General Motors stock. On the other hand, they boosted their position in Kroger by 21%, RH by 2%, and Aon - their only new investment in the first quarter - by 7%.
The total value of Berkshire's portfolio - which is dominated by massive stakes in Apple, Bank of America, American Express, Coca-Cola, and Kraft Heinz - rose by 8% to $293 billion last quarter. There were no major changes, which was widely expected as the company's recent second-quarter earnings showed it only bought $1 billion of stocks and disposed of $2.1 billion worth in the period.
The only new holding was Organon, the name given to a bunch of Merck's businesses that it spun off in June. Merck shareholders received one Organon share for every 10 Merck shares they held.
Notably, Berkshire didn't eliminate its Wells Fargo stake last quarter, despite selling the overwhelming majority of it since last year. Buffett's company has been a shareholder for more than 30 years, and counted the bank among its five biggest holdings for most of that time. Indeed, it owned more than 13% of Wells Fargo in 1994, and held $27 billion worth of its shares in 2016 - dwarfing its $31 million stake at the end of June.
Buffett is eager to deploy up to $80 billion of Berkshire's roughly $140 billion cash pile, he said at Berkshire's annual shareholder meeting in May. However, the investor has struggled to find bargains with stocks at close to record highs, private equity firms and SPACs driving up the prices of acquisitions, and even buybacks becoming less attractive with Berkshire stock up 27% this year.