Wall Street Watch Wednesday: Warren Buffett's Spring Cleaning


Berkshire Hathaway (BRK.A) (BRK.B) came out with its quarterly portfolio update on Tuesday afternoon, and apparently Warren Buffett was in a selling mood during this year's second quarter.

The iconic investor's spring cleaning involved dumping Berkshire Hathaway's entire investment in Intel (INTC) and nearly two thirds of the holding company's stake in Johnson & Johnson (JNJ).

A few consumer brand behemoths -- Procter & Gamble (PG), General Electric (GE), and Kraft Foods (KFT) -- also saw their positions in Berkshire Hathaway's widely followed portfolio pruned back.

Buffett didn't just sit on his company's bountiful cash position, though. Berkshire Hathaway has taken a liking to the depressed energy market, and bought into National Oil Well Varco (NOV) and Phillips 66 (PSX). Berkshire also increased its ownership in banking bellwethers Wells Fargo (WFC) and Bank of New York (BK).

Buffett may have splintered his fan base when he grew vocal about raising tax rates on the wealthy, but he has proven over the decades to be an astute investor whose moves bear watching.

Other Things Worth Watching

• The CEO search is over at New York Times (NYT). BBC Director-General Mark Thompson was introduced as the newspaper giant's next president and CEO on Tuesday night. He will also be added to the company's board when he begins his tenure in November. Running a newspaper company is obviously a daunting task these days as news consumption shifts from print to digital.

• Bob Evans (BOBE) knows a thing or two about home cooking, and now the casual dining chain specializing in country-style comfort food is putting its money where its shareholders' mouths are. It's increasing its quarterly dividend 10% to $0.275 a share. Bob Evans also revealed on Tuesday afternoon that it's buying mashed potatoes maker Kettle Creations. The acquisition will give Bob Evans deeper retail penetration in grocery stores.

• On the earnings front, JDS Uniphase (JDSU) posted better than expected quarterly results after Tuesday's market close. The optical networking firm earned $0.15 a share on $439 million in revenue, well above the $0.12 a share on $423 million in revenue that the market was forecasting.

Motley Fool contributor Rick Munarriz does not own shares in any of the stocks in this article. The Motley Fool owns shares of Johnson & Johnson, Berkshire Hathaway, National-Oilwell Varco, Wells Fargo, and Intel. Motley Fool newsletter services have recommended buying shares of National-Oilwell Varco, Procter & Gamble, Wells Fargo, Johnson & Johnson, Berkshire Hathaway, and Intel. Motley Fool newsletter services have recommended creating a diagonal call position in Johnson & Johnson.

Increase your money and finance knowledge from home

Understanding Stock Market Indexes

What does it mean when people say "the market is up 2%"?

View Course »

Socially Responsible Investing

Invest in companies with a conscience.

View Course »

Add a Comment

*0 / 3000 Character Maximum


Filter by:

Thought for sure he was dumping Bank of America.....they are ruthless and inhuman.

August 16 2012 at 11:03 AM Report abuse rate up rate down Reply

He bought a mittpile of short term bonds with low default probability........I suggest you do likewise

August 15 2012 at 10:38 PM Report abuse rate up rate down Reply

He's obviously losing it--selling his best stocks. There's no fool like an old fool!

August 15 2012 at 6:24 PM Report abuse rate up rate down Reply

Cheryl responded I am inspired that a student can profit $7995 in four weeks on the network. have you look this (Click on menu Home)

August 15 2012 at 5:00 PM Report abuse rate up rate down Reply

Summer is almost over. Kinda late for sping cleaning of any kind.

August 15 2012 at 4:59 PM Report abuse rate up rate down Reply

What Buffett was doing was pandering the Left... He's very much aware, as are most of the super wealthy that to keep Liberals off your back, Just tell them what they want to hear... Knowing full well nothing going to happen.

August 15 2012 at 1:39 PM Report abuse rate up rate down Reply
3 replies to bchrist751's comment

The smart move for him would be to get rid of that worthless GM stock!!!

August 15 2012 at 9:35 AM Report abuse rate up rate down Reply
1 reply to David's comment

I see more and more GM vehicles around. Ten years ago, the only people driving Cadillacs were people with a lot of gray hair. Now, I see a lot of people would have been driving M-B C-Classes and E-Classes and BMW 3-Series and 5-Series driving CTS's.

The hot cars in the parking lot at my son's schools are all GM crossovers, Equinox, Traverse, Terrain, Acadia, and Enclave.

As Warren's partner, Charlie Munger, said at the shareholders' meeting, sometimes, the market is wrong. When the market unfairly depresses a stock, buy it. At some point, the market will understand that GM sells much better cars, at higher prices, and reflect that.

August 15 2012 at 5:25 PM Report abuse +2 rate up rate down Reply