Warren Buffett's Berkshire Hathaway (BRK.B) opened six new positions — most notably a sizable stake in UnitedHealth Group (UNH) — pared its holdings of Apple (AAPL) and Bank of America (BAC) and exited one stock entirely during the second quarter.
Berkshire, of which Buffett serves as chairman and CEO, continued to reduce its exposure to equities as the market recovered sharply off its April low, according to a regulatory filing made with the Securities and Exchange Commission on Thursday.
For the three months ended June 30, the company purchased about $4 billion worth of stock and sold $7 billion. That works out to about $3 billion in net sales. The holding company has been a net seller of equities for 11 consecutive quarters.
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Increasingly stretched valuations also led Berkshire Hathaway to halt stock buybacks since last year.
But Buffett did spy some bargains along the way. Not only did Berkshire scoop up UNH on the cheap, it also added some homebuilders to its equity portfolio, and added to major existing positions in Chevron (CVX) and Constellation Brands (STZ), among other holdings.
Before we get into Berkshire's most recent buys and sells, it's important to know that Buffett has always run a highly concentrated portfolio.
Excluding the company's Japanese brokerage stocks and other overseas equities, Apple alone accounts for more than a quarter of Berkshire's stock portfolio, according to data from WhaleWisdom. (That's down from more than 40% a year ago.)
Furthermore, Berkshire's top five U.S. equity holdings comprise about 70% of its portfolio value, while the top 10 account for 87%.
As Buffett likes to say, diversification is for those who don't know what they're doing.
Also, please note that Buffett handles the largest positions in the Berkshire Hathaway portfolio.
Buffett says his co-managers — Ted Weschler and Todd Combs, who is CEO of Geico — act independently. They're thought to manage about 10% of the portfolio. Buffettologists generally assume Berkshire's smaller buys and sells are the work of these colleagues.
Stocks Warren Buffett is buying
The biggest splash Buffett made in a long while came in the form of buying beaten-down UnitedHealth Group. One of the more influential components of the price-weighted Dow Jones Industrial Average lost as much as 45% of its value for the year to date through mid-May.
Shares were hurt by rising Medicare costs, a Department of Justice investigation into its billing practices and the murder of an executive.
Buffett stepped in by picking up a little more than 5 million UNH shares from April 1 to June 30. Berkshire's stake in the nation's largest health insurer was worth $1.6 billion at the end of Q2 (second quarter). UNH, with a weight of 0.6%, is now the 18th-largest position in the Berkshire Hathaway equity portfolio.
In addition to a depressed share price, Buffett was also likely attracted to UNH's dividend. At 3.3%, UNH yields more than double the S&P 500. Buffett loves dividends even though Berkshire doesn't pay one itself.
In a rare move into the materials sector, Berkshire initiated a stake in steelmaker Nucor (NUE). The conglomerate purchased 6.6 million shares in NUE with a market value of $857 million as of quarter's end. At 0.3% of the portfolio, NUE is Berkshire's 25th-largest position.
NUE stock languished during Q2. In addition to being a bargain stock at a time when steel prices are soaring on tariffs, NUE also happens to be one of the best dividend stocks to buy for dependable dividend growth.
In other buys, Berkshire made new bets in the consumer discretionary sector, adding two homebuilders to its portfolio. The company initiated a position of 7 million Class A shares in Lennar (LEN), worth $780 million as of June 30. With a 0.3% weighting, LEN is Berkshire's 26th-largest holding.
In addition, the holding company bought 28,358 more Class B shares of Lennar, a position that was initiated in the third quarter of 2023.
Buffett's team also bought 1.5 million shares in D.R. Horton (DHI). But the $191 million stake accounts for less than 0.1% of the portfolio, or Berkshire's 32nd-largest holding.
In other purchases, Berkshire initiated a small stake in outdoor advertising company Lamar Advertising (LAMR). With 1.2 million shares worth $142 million as of June 30, LAMR accounts for less than 0.1% of Berkshire's stock holdings.
Buffett's team also picked up 780,133 shares in Allegion (ALLE), which makes commercial and residential locks, among other security hardware. The stake, worth $112 million as of quarter's end, weighs in at less than 0.1% of Berkshire's equity portfolio.
Elsewhere, as mentioned above, Berkshire boosted its stake in Chevron by almost 3%, buying another 3.5 million shares in the integrated energy major. With 122.1 million shares worth $17.5 billion as of June 30, CVX accounts for nearly 7% of the portfolio, or its fifth-largest holding.
Separately, Berkshire increased its stake in beer, wine and spirit maker Constellation Brands by nearly 12%. With a market value of $2.2 billion as of quarter's end, STZ is Berkshire's 17th-largest holding, accounting for 0.9% of its U.S. equity holdings.
The holding company also boosted other smaller positions, such as Domino's Pizza (DPZ), Pool Corp. (POOL) and Heico (HEI).
Stocks Warren Buffett is selling
Buffett continued to pare back Berkshire's position in Apple, which, as recently as last year, accounted for roughly 40% of its U.S. holdings. The company sold 20 million shares over the course of the second quarter, but Buffett has hardly lost faith in the iPhone maker.
With 280 million shares worth more than $57 billion as of June 30, AAPL remains Berkshire's largest holding by far. However, it now has a weighting of a little more than 22% in the portfolio, down from almost 26% at the end of Q1.
Buffett once again sold Bank of America stock last quarter, which has been a major holding since 2017. Berkshire reduced its stake in the nation's second-largest bank by assets by another 4.2% in Q2, selling more than 26 million shares.
With 605 million shares worth nearly $29 billion as of June 30, BAC is Berkshire's third-largest holding, accounting for more than 11% of the portfolio value.
In other sales, Berkshire continued to lighten up on Charter Communications (CHTR), as it did the previous three quarters. CHTR is now less than 0.2% of the portfolio value.
Other stocks Berkshire continued to ease up on included Formula One Group (FWONK) and DaVita (DVA).
Lastly, Berkshire exited what was left of its stake in T-Mobile US (TMUS). The 3.3 million TMUS shares once accounted for 0.4% of the portfolio, or its 22nd-largest holding.
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