One of the most prominent investment minds in the world, when Warren Buffett makes a move, Wall Street listens. The Berkshire Hathaway CEO is not called the Oracle of Omaha for nothing and has helped direct the path of many an investor during his day. Now, his latest move is driving some intrigue, as Warren Buffett has dumped more than $10 billion in Bank of America (BAC) stock.
Now, the biggest question is why? Since the middle of July, Buffett’s Berkshire has been unloading the banking stock. Just last week, the investment firm embraced a 16th round of selling, this time offloading almost $370 million in shares. Now, their stake in the company has dropped below 10%.
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Buffett’s Berkshire Keeps Dumping Bank of America as Stake Falls
Both Warren Buffett and his Berkshire Hathaway investment firm have continued to be one of the most prominent investors on Wall Street. They own more than 45 positions at a $318 billion market value. Moreover, the firm itself has a $1 trillion market cap, as its dominance cannot be denied.
In the first half of 2024, Berkshire’s unrealized and realized gains reached $20.23 billion. Moreover, it currently has holdings in Apple (APPL), American Express (AXP), and Coca-Cola (KO). Yet, one of their largest positions has begun to fall.
In a rather surprising move, Warren Buffett has dumped more than $10 billion in Bank of America (BAC). The news is rather surprising considering many experts are still bullish on the stock. However, the reasoning may be more closely connected to taxation logistics than any investment insight.
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Investors that hold 10% of stakes in a company must report trades to the US Securities and Exchange Commission (SEC) within two days, as opposed to quarterly. That could be a reason for Berkshire’s decision to drop below the 10% mark.
Interestingly, the firm had fallen below 10% holdings of Bank of America in early September. They proceeded to repurchase $3.5 billion of stock in Q3, pushing back above the threshold. Since the firm started selling in July, BAC has fallen more than 4%.
There is the belief that Buffett made the decision to simply make a profit. The shares had increased 75% from last October prior to the July dip. Alternatively, they could be set to liquidate their position. Buffett had done so previously with holdings in JPMorgan, Wells Fargo, and US Bancorp.
