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As of August 2023, Berkshire Hathaway has reduced its stake in Bank of America to over 605 million shares, representing an 8.2% ownership of the banking giant and 9.8% of Berkshire’s total portfolio. This marks a substantial reduction of approximately 427 million shares, or about 41%, sold since July 2024. Despite the sell-off, Bank of America remains Berkshire’s third-largest holding.
Buffett’s reason for the sale may involve strategic tax planning, anticipating an increase in corporate tax rates, and a desire to chase value as Bank of America’s price-to-book ratio was approximately 1.29 in early August, indicating a 29% premium. Concurrently, Berkshire has increased its stake in Pool (NASDAQ: POOL) by 136%, owning over 3.4 million shares valued at more than $1 billion, further emphasizing their investment strategy.
Berkshire’s total cash reserves have reached a record $344 billion. This shift in holdings highlights a strategy focused on maintaining liquid assets while selectively investing in companies believed to have strong competitive advantages.
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