Berkshire Hathaway Reveals New Holdings in General Motors, Viacom
Berkshire Hathaway, Warren Buffett's holding company, released an SEC filing yesterday that revealed new holdings in General Motors (NYSE: GM) and Viacom (NASDAQ: VIAB) as of March 31st. The conglomerate also reported selling its entire stake in Comdisco Holdings.
Investments by Warren Buffett's firm are often seen as a key vote of confidence, given his successful track record as a value investor. Class A shares of Berkshire Hathaway (NYSE: BRK.A) have increased by close to 1735% since the beginning of 1991, relative to around a 305% increase for the S&P 500 Index. Buffett often invests in companies that are deeply undervalued and have assets that competitors cannot easily undermine.
Shares of General Motors are currently trading more than 25% lower than their $33 initial public offering (IPO) price in November 2010. This IPO followed the automotive manufacturer's bankruptcy, which was largely induced by the financial crisis.
Paulson & Co, a hedge fund founded by John Paulson, also reported purchasing shares of Viacom. Viacom, an entertainment content provider, operates popular television and film brands, such as Paramount Pictures, MTV Networks and Nickelodeon Movies. On May 3rd, Viacom released earnings per share of $0.98 that outshined the consensus analyst estimate of $0.89.
Berkshire Hathaway also reported increasing existing stakes in seven companies: DirecTV (NASDAQ: DTV), IBM (NYSE: IBM), Bank of New York Mellon (NYSE: BK), DaVita (NYSE: DVA), Wal-Mart (NYSE: WMT), Wells Fargo (NYSE: WFC) and Liberty Media (NASDAQ: LMCA). All of these companies, with the exception of Wal-Mart, have outperformed the S&P 500 Index year to date.
Moreover, Buffett's company reported significantly decreasing existing stakes in Intel (NASDAQ: INTC), Procter & Gamble (NYSE: PG), Verisk Analytics (NASDAQ: VRSK), Dollar General (NYSE: DG) and Kraft (NYSE: KFT), all of which, with the exception of Dollar General, have underperformed the S&P 500 index year to date.
Last summer, Warren Buffett announced a notable investment in preferred stock of Bank of America (NYSE: BAC). Shares of the bank then rose more than 40% over the following seven months, only to decline more than 25% from their peak to date.
Disclosure: At the time of this writing, I did not own shares of any companies mentioned in this post.
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