Warren Buffett’s Contrarian Move: 4 Stocks He Can’t Stop Buying
As the investment world closely follows the actions of Berkshire Hathaway CEO Warren Buffett, his recent moves have sent a mixed signal to Wall Street. On one hand, Buffett’s team has sold nearly $132 billion more in stocks than they’ve purchased over the past seven quarters, suggesting that the market may be overvalued. On the other hand, he’s been aggressively buying shares of four unstoppable stocks.
Buffett’s Cash Pile Reaches Record High
As of June 30, Berkshire’s cash pile stood at a record $276.9 billion, indicating that Buffett is being cautious about deploying capital in the current market environment. However, this hasn’t stopped him from piling into his favorite stocks.
Stock #1: Sirius XM Holdings
Between October 9 and 11, Berkshire acquired approximately 3.56 million shares of Sirius XM, increasing its stake to 108.7 million shares or roughly 32.1% of the company’s outstanding shares. Buffett is attracted to Sirius XM’s sustainable moat as the only licensed satellite-radio operator, providing superior subscription pricing power.
Stock #2: Occidental Petroleum
Berkshire has built its position in Occidental Petroleum from scratch to almost 255.3 million shares since 2022 began. Buffett believes that the spot price of crude oil will remain elevated or head higher, benefiting Occidental’s higher-margin drilling segment.
Stock #3: Chubb
Berkshire’s mystery stock was revealed to be Chubb in mid-May, with Buffett buying more than 27 million shares between July 1, 2023, and June 30, 2024. The insurance industry’s premium pricing power and Chubb’s ability to invest its float in high-yielding Treasury bills make it an attractive investment.
Stock #4: Berkshire Hathaway
Buffett has spent nearly $78 billion buying shares of his own company’s stock over the past 24 consecutive quarters. This move not only increases the ownership stakes of Berkshire’s shareholders but also reduces the company’s outstanding share count, making its stock more attractive to fundamentally focused investors.
Conclusion
While Buffett’s warning to Wall Street suggests that value is hard to come by, his actions indicate that he’s still finding opportunities in these four unstoppable stocks. As investors, it’s essential to consider Buffett’s contrarian move and evaluate whether these stocks align with our own investment goals and risk tolerance.
Leave a Reply