Berkshire remained a net seller despite the market rally, with $127 billion in net stock sales in 2024.
Major stock sales: Apple ($110B), Bank of America ($14B), Citigroup ($3B).
Major stock purchases: Chubb ($7B), Occidental ($13B, 30% stake), Constellation Brands ($1B).
Apple stock sales resulted in an estimated $35 billion in lost gains.
Berkshire’s cash reserves reached $310 billion (Q3 2024), expected to be even higher.
Berkshire Class A stock gained 6.5% YTD, outperforming the S&P 500.
Opinion
Buffett’s cautious stance reflects concerns over overvaluation in the market. Despite short-term opportunity costs from stock sales, Berkshire’s massive cash reserves position it well for future downturns. Buffett’s historical track record suggests that his contrarian approach may once again prove successful in the long run.
Core Sell Point
Berkshire is prioritizing cash over stocks, preparing for future buying opportunities rather than chasing market highs. Investors should consider market valuation risks and the benefits of cash reserves in uncertain times.
Despite the S&P 500 gaining 25% in 2024 and an additional 4% increase in 2025, Berkshire Hathaway remains a net seller in the market. Buffett, managing Berkshire’s $300 billion equity portfolio, has shown little enthusiasm for the soaring stock market.
For Buffett to re-enter the market, a significant sell-off may be required, but few expect such a downturn in 2025. Buffett, now 94 years old, will turn 95 in August and mark his 60th anniversary as Berkshire’s CEO in 2025.
Key Portfolio Changes & Market Impact
Q4 2024: Berkshire had $6 billion in net stock sales, slowing from $127 billion in net sales in the first three quarters of 2024.
Major Stock Sales in 2024
Apple: Sold $110 billion worth of shares, reducing its stake by two-thirds to 300 million shares ($73 billion value).
Bank of America: Sold $14 billion in shares.
Citigroup: Sold $3 billion, reducing its stake to $1 billion.
Major Purchases in 2024
Chubb: $7 billion investment.
Occidental Petroleum: $13 billion, raising its stake to 30%.
Apple sale price: ~$185/share → Current price: $244/share, leading to an estimated $35 billion in missed gains.
Bank of America sale price: ~$40/share → Current price: $47/share.
Strategic Positioning & Market Sentiment
Despite underperforming in short-term trades, Buffett has historically positioned Berkshire against market bubbles, including the 1990s dot-com boom, where he was ultimately proven right.
Berkshire’s cash reserves hit $310 billion as of Q3 2024, likely higher by year-end due to continued stock sales.
Berkshire Class A shares rose 6.5% YTD, outperforming the S&P 500 by 2 percentage points.
While some criticize Buffett’s timing, long-term investors remain confident in his conservative approach, especially given Berkshire’s ability to deploy massive capital during market downturns.
[Compliance Note]
All posts by Sellsmart are for informational purposes only. Final investment decisions should be made with careful judgment and at the investor’s own risk.
The content of this post may be inaccurate, and any profits or losses resulting from trades are solely the responsibility of the investor.
Core16 may hold positions in the stocks mentioned in this post and may buy or sell them at any time.
