Wednesday 17th February 2021
While others get out
Buffett invests in petroleum and himself
The US oil company Chevron had its worst financial year in years because of the pandemic. That is exactly what investment guru Buffett apparently thinks is the right time to join. However, by far the largest sum in the billions is invested in his own shares.
US investment legend Warren Buffett has changed the portfolio of his company Berkshire Hathaway significantly in recent months. Among other things, he acquired shares in the Chevron oil company for $ 4.1 billion. This emerges from a report on the Group's investments as of December 31. He bought shares in Verizon Communications, the largest US wireless operator, for $ 8.6 billion. Buffett's company also took advantage of the US subsidiary of Deutsche Telekom, T-Mobile USA. At the same time Berkshire sold part of its Apple shares. However, the shares of the iPhone manufacturer continued to be by far the most valuable stake in the Berkshire portfolio.
The investment in Chevron in particular seems remarkable: At the moment, not only are many other large investors leaving the oil industry in order to improve the carbon footprint of their portfolios. Chevron had its worst year since 2016 due to the economic slump and the resulting low demand for oil. However, Berkshire is apparently expecting the industry to recover soon. The oil price had recently picked up again. Some analysts even predict a medium-term increase to 100 dollars or more per barrel, since oil production has recently fallen more sharply than the demand is declining in the course of a change in the global economy to renewable energies.
It is not clear from the Berkshire announcement whether the investment decision came from Buffett himself or from managers Todd Combs and Ted Weschler. They are expected to take over all of Berkshire's investments when the 90-year-old Buffett is no longer at the helm.
More than 15 billion for own shares
Berkshire has also made adjustments to its pharmaceutical portfolio. The $ 136 million stake in Pfizer was sold, while the stakes in Abbvie, Merck & Co and Bristol Myers Squibb were increased. In the financial sector, Berkshire sold its remaining stake in JP Morgan for $ 93 million and reduced its stake in Wells Fargo by $ 1.4 billion.
Last year Berkshire sold stakes in airlines including United Airlines, American Airlines Delta Air Lines and Southwest Airlines. Buffett believes that consumer behavior in the travel industry has changed over the long term.
Observers have been waiting for Buffett to use a large portion of Berkshire's more than $ 150 billion in cash to invest in other companies. Instead, the company spent billions on its own shares, with $ 15.7 billion on share buybacks in the first nine months of 2020 alone.
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