Warren Buffett's Portfolio: Fourth Quarter 13F Filing ~ market folly

Friday, February 19, 2010

Warren Buffett's Portfolio: Fourth Quarter 13F Filing

(This post is part of our series on tracking hedge fund portfolios. If you're unfamiliar with tracking investments they disclose via SEC filings, check out our series preface on hedge fund 13F filings.)

Warren Buffett needs no introduction. Seriously. If you don't know who he is, you shouldn't even be reading this.

Through his early Buffett partnerships to the modern days of Berkshire Hathaway (BRK.A), he is regarded as one of the most successful investors ever. While many would argue that Baupost Group's Seth Klarman could give Buffett a run for his money, Buffett has garnered quite a massive following due to his enormous returns over time. Needless to say, investors are always anxious to find out what he has bought or sold, and that's exactly what we're here to do today. To learn to invest like the legend himself, head to Warren Buffett's recommended reading list.

The positions listed below were Berkshire Hathaway's long equity, note, and options holdings as of December 31st, 2009 as filed with the SEC. All holdings are common stock unless otherwise denoted.

Brand New Positions

Increased Positions
Republic Services (RSG): Increased by 128.7%
Iron Mountain (IRM): Increased by 107.6%
Beckton Dickinson (BDX): Increased by 25%
Walmart (WMT): Increased by 3.2%
Wells Fargo (WFC): Increased by 2.2%

Reduced Positions
Exxon Mobil (XOM): Reduced by 67%
United Health Group (UNH): Reduced by 65.4%
WellPoint (WLP): Reduced by 60.4%
Gannett (GCI): Reduced by 36.1%
ConocoPhillips (COP): Reduced by 34.3%
Ingersoll Rand (IR): Reduced by 27.6%
Johnson & Johnson (JNJ): Reduced by 26.5%
SunTrust Banks (STI): Reduced by 22.1%
Moody's (MCO): Reduced by 18.9% ~ we've detailed all of his sales as they've happened
CarMax (KMX): Reduced by 11.1%
Procter & Gamble (PG): Reduced by 9.2%

Removed Positions (Sold out completely):
Union Pacific (UNP)
Norfolk Southern (NSC)
These were both sold due to conflict with Berkshire's impending acquisition of Burlington Northern.

Top 15 Holdings by percentage of assets reported on 13F filing

  1. Coca Cola (KO): 19.7%
  2. Wells Fargo (WFC): 14.9%
  3. Burlington Northern Santa Fe (BNI): 13.1% ~ this won't show up in future filings
  4. American Express (AXP): 10.6%
  5. Procter & Gamble (PG): 9.2%
  6. Kraft Foods (KFT): 6.5%
  7. Walmart (WMT): 3.6%
  8. Wesco Financial (WSC): 3.38%
  9. ConocoPhillips (COP): 3.32%
  10. Johnson & Johnson (JNJ): 3.02%
  11. US Bancorp (USB): 2.68%
  12. Moody's (MCO): 1.47%
  13. Washington Post (WPO): 1.31%
  14. Nike (NKE): 0.87%
  15. M&T Bank (MTB): 0.78%

The name of the game for Warren Buffett was selling shares of other holdings in order to make way for their acquisition of Burlington Northern Santa Fe in its entirety. That massive purchase obviously will not show up in future filings and is Berkshire's largest purchase ever. Obviously when you're purchasing that large of an entity, you're not going to be buying much else. However, Buffett did also double down on his Iron Mountain and Repulic Services positions.

Buffett reduced 'health' holdings by selling over half of his UNH and WLP stakes. Additionally, he sold nearly 70% of his Exxon Mobil position. We've also covered Buffett's sales of MCO shares as they became somewhat frequent occurrences. It remains to be seen if those sales were more-so because Buffett felt the business was threatened or because he was trying to free up capital for his BNI acquisition. Buffett has maintained a large position in Kraft for a while now, but shares have been center stage as Bill Ackman's hedge fund Pershing Square recently acquired a large stake and the company recently sealed a deal to acquire Cadbury.

Keep in mind that there are also some positions that won't show up on the filing because they are non-equity stakes. Buffett acquired many of these during the heart of the crisis in 2008 and as such sealed these deals with ridiculously good terms (for him).

To hear some of Buffett's recent thoughts, we posted up his recent television interview. For analysis of Berkshire Hathaway (BRK.A / BRK.B), we noted that hedge fund T2 Partners deemed shares undervalued in their in-depth presentation. And lastly, make sure you check out Warren Buffett's recommended readings.

We'll be tracking 40+ prominent funds in our fourth quarter 2009 hedge fund portfolio tracking series. We've already covered Seth Klarman's Baupost Group, Mohnish Pabrai's Investment Fund, Carl Icahn's hedge fund Icahn Partners, David Einhorn's Greenlight Capital, Stephen Mandel's Lone Pine Capital, John Griffin's Blue Ridge Capital, and David Tepper's Appaloosa Management. Check back daily for our new updates.

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