This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Warren Buffett's 6 New Investments

NEW YORK ( TheStreet) -- Warren Buffett revealed earlier today that he spent more than $10 billion for a stake in software-services company IBM (IBM - Get Report), his first investment in a technology company. And now a regulatory filing shows he made another bet on tech: chipmaker Intel (INTC - Get Report).

IBM is Berkshire Hathaway's (BRK.A - Get Report) second-largest holding, pushing Wells Fargo (WFC) to the No. 3 spot. Coca-Cola (KO) is his conglomerate's biggest investment.

Warren Buffett

The billionaire investor's portfolio held only 33 stocks as of Sept. 30. Buffett started buying IBM shares in March and accumulated 24.9 million shares in the second quarter before adding 32.5 million shares in the third quarter and an undisclosed amount in the current quarter.

Buffett had avoided investing in technology companies because he said they're difficult businesses to predict. Trends come and go, and he prefers longstanding companies such Fruit of the Loom underwear and See's Candies. But IBM, founded in 1911, is as ingrained in the world of technology as railroads are in commodities transportation and machinery companies are in manufacturing.

Buffett's entry into IBM is based on the company's service offerings, which are more predictable and conducive to his value-investing strategy. But Intel is a different animal. It's more likely a play on dominant brands backed by strong customer loyalty. Those brands stand to gain market share in a world that's becoming more driven by technology every day.

>>View Warren Buffett's Portfolio

Buffett doesn't always publish his holdings in so-called 13-F filings. If he's building a stake in a company, he uses a loophole to opt out of disclosure regulations. But once his holdings are released publicly, people tend to follow him, pushing up share prices.

Based on the third quarter 13-F filing, released today, Buffett added to positions in Wells Fargo and Dollar General (DG). He cut his investments in Kraft Foods (KFT), Johnson & Johnson (JNJ) and ConocoPhillips (COP).

Overall, Buffett added six new investments last quarter. The following pages detail those, including IBM.






6. IBM (IBM - Get Report)

Company Profile: IBM offers technology and business services in addition to developing operating system software.

Buffett's Investment: The hedge fund bought 32.5 million shares of IBM during the third quarter, bringing his total investment to 57.4 million shares valued at $10 billion as of Sept. 30. Subsequent to the third quarter, Buffett bought more shares for a total of 64 million worth $10.7 billion.

Share Price Performance: Since the end of March, when Buffett began buying, the stock is up 15%. The stock reached a new 52-week high Oct. 14. At an average purchase price of $170, Buffett probably took advantage of a dip in mid-August when Moody's downgraded U.S. debt.

Content on this page requires a newer version of Adobe Flash Player.

Get Adobe Flash player

1 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
BRK.A $217,000.00 0.00%
CVS $103.95 0.00%
DTV $91.57 0.00%
GD $139.64 0.00%
IBM $172.22 0.00%

Markets

DOW 18,232.02 -53.72 -0.29%
S&P 500 2,126.06 -4.76 -0.22%
NASDAQ 5,089.3620 -1.4320 -0.03%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs