Berkshire Hathaway leans into stock liquidation, repurchases Sirius XM shares

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Berkshire Hathaway leans into stock liquidation, repurchases Sirius XM shares
Credit: © Reuters.

Berkshire Hathaway (NYSE: BRKa ), the conglomerate helmed by Warren Buffett, has been actively adjusting its investment portfolio, selling $5.253 billion more stocks than it purchased since the beginning of October, as revealed by the company's third-quarter figures. The latest Form 13Fs filings, mandatory disclosures for asset managers, highlight significant divestments from companies such as General Motors (NYSE: GM ) and Johnson & Johnson. In a strategic move that marks a departure from its previous year's actions, Berkshire Hathaway has re-invested in Sirius XM Holdings (NASDAQ: SIRI ), purchasing shares worth approximately $47.35 million.

The decision to repurchase shares in the satellite-radio operator is particularly noteworthy given that Buffett’s deputies, Todd Combs and Ted Weschler, had previously reduced their stake in Sirius XM during the fourth quarter of 2021 due to concerns over rising interest rates and recession risks that typically impact advertising-dependent sectors. However, Sirius XM's unique market position as the sole satellite-radio service provider and its strong subscription-based revenue model appear to have made it an attractive investment once again for Berkshire Hathaway. This move is seen as aligning with Berkshire's value-oriented investment philosophy, which often focuses on companies with robust economic moats capable of weathering downturns.

InvestingPro Insights

Berkshire Hathaway (BRKb (NYSE: BRKb )) has been showing promising signs in its financial health, according to InvestingPro data. With a market cap of $780.76 billion and a P/E ratio of 10.31 as of Q3 2023, the company's financial strength is evident. Moreover, the revenue growth of 18.05% over the last twelve months as of Q3 2023 shows that the company is on a positive trend.

InvestingPro Tips for Berkshire Hathaway highlight that the company has a perfect Piotroski Score of 9 and its revenue growth has been accelerating. This suggests that the company is financially sound and is expected to grow in the future.

On the other hand, Sirius XM Holdings (SIRI) has a market cap of $19.5 billion and a P/E ratio of 15.73 as of Q3 2023, indicating a solid market presence. The company has seen a significant return over the last week and operates with a high return on assets, as per InvestingPro Tips.

These insights, among many others, are part of the InvestingPro subscription, which is now on a special Black Friday sale with a discount of up to 55%. With InvestingPro, subscribers can access nine more tips for Berkshire Hathaway and ten more for Sirius XM Holdings, providing a comprehensive view of these companies' financial health and future prospects.

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