Warren Buffett Pushing More Cash To Equities; 'Big 5' Stocks Still At The Top

Warren Buffett’s Berkshire Hathaway Inc. (NYSE: BRK-A) (NYSE: BRK-B) filed its 13F for the first quarter on Tuesday, revealing what changes it made to its portfolio during the period. The company’s equity portfolio increased from approximately $166 billion at the end of 2017 to $169 billion.

Morgan Stanley’s Kai Pan doubts the company will issue dividends and noted that Buffett doesn't see Berkshire’s current valuation as cause for a large buyback, both of which drive his expectation that more cash will be spent buying equity.

Pan also took at look at what positions were cut and raised, highlighting a few of the more notable changes.

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Buffett’s Big 5 Stay At The Top

Berkshire’s top five positions remained the same through Q1. The group includes Apple Inc. AAPL, American Express Company AXP, Bank of America Corp BAC, The Coca-Cola Co KO and Wells Fargo & Co WFC. Each holding has a market value of more than $10 billion.

As announced by Buffett ahead of Berkshire’s annual shareholder meeting, the company increased its stake in Apple from 166 million shares to 240 million shares. Since then the stock has returned 11 percent, adding $4.4 billion to Berkshire’s portfolio.

Berkshire cut its stake in Wells Fargo by approximately 7.8 million shares, which as of Tuesday’s close had a market value of over $427 million. The company still owns over 450 millions shares valued at more than $24.6 billion.

The Oracle of Omaha maintained his positions in American Express, Bank of America and Coca-Cola.

Other Notable Picks

Pan took notice of two other buys by Berkshire: Teva Pharmaceutical Industries Ltd TEVA and Monsanto Company MON. Berkshire’s stake in Monsanto increased by 62 percent, while it more than doubled the number of Teva shares it holds.

It should be noted Teva is still a relatively small part of Berkshire’s overall portfolio, at around $700 million.

The company also dissolved its stake in IBM IBM and cut its holdings in Verisk Analytics, Inc. VRSK and Phillips 66 PSX by 82 percent and 43 percent, respectively.

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