Warren Buffet is on a selling spree. According to reports, his company Berkshire Hathaway has almost multiplied its cash pile by 3 times in the past 2 years and pushing it up to a level of $325 billion. For statistics lovers, the cash pile of the company has surpassed its market just 10 years ago.
The unprecedented act by the man who has always believed in investing in the long run has sent analysts wondering. Some have speculated that it could be a not enough assets to buy that merit Buffets attention. But there are other intriguing possibilities. “I have heard every speculative idea imaginable, from accumulating capital for a doomsday scenario to planning to make a gigantic cash dividend,” Lawrence Cunningham, the director of the University of Delaware’s Weinberg Center on Corporate Governance was quoted in the western media as saying.
What shares did Buffet sell
Reports state that Warren Buffet has offloaded a large number of shares of Apple, which he holds dear to his heart, and Bank of America as well as some other shares. Significantly, in May Buffet told Berkshire shareholders (at the AGM) that he still values Apple a lot. In fact, Buffet’s company held more than 10% of Bank of America’s shares.
Why is Warren Buffet selling shares
“Buffett sees stocks as overvalued, including his own, and therefore susceptible to a deep correction or outright bear market,” wrote Nicholas Colas, co-founder of DataTrek Research. A more spicy speculation revolves around possible big bang acquisition. “Berkshire may have identified one or more large acquisitions and is raising capital for those purchases,” Colas mentioned. According to Colas the cash chest of $320 billion can easily be used to buy Coca-Cola or Goldman Sachs.
In fact, Berkshire Hathway is now sitting on $320 billion in cash and $272 billion in stocks – quite a surprising figure for a worshipper of equity investments.
Perhaps the most iconic of modern investors, Warren Buffet, has been selling stocks and piling up cash at a furious pace that has sent tongues wagging as to what does the Oracle of Omaha has up his sleeve at the age of 94. Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
