In the fourth quarter, Warren Buffett’s Berkshire Hathaway significantly reduced its holdings in Taiwan Semiconductor Manufacturing Co. also called as TSMC by 86.2% to 8.29 million ADRs also called as the American depositary shares.
This move comes just three months after the firm purchased over $4.1 billion worth of TSMC stock, which sent shares skyrocketing. Additionally, Berkshire Hathaway reduced its stake in several banks while increasing its holdings in Apple Inc.
The news of the reduction in TSMC shares caused a significant drop in the company’s depository receipts, with a 4% dip in US after-hours trading on Tuesday and a 3.3% decline in TSMC shares in Asian markets on Wednesday. However, TSMC’s shares have still surged almost 32% this year, closing at $97.96 on Tuesday.
Despite the significant decrease in TSMC holdings, it is worth noting that Berkshire Hathaway still made a profit on the investment. According to CFRA Research analyst Cathy Seifert, the company bought TSMC stock for approximately $68.5 and sold it for $74.5, resulting in a small profit.
This move by Berkshire Hathaway is notable, as TSMC has been a strong performer in recent years, benefiting from the increasing demand for chips in various industries. The company’s market capitalization is now more than $500 billion, making it one of the most valuable companies in Asia. However, it is also possible that Berkshire Hathaway is taking profits from TSMC after its impressive gains and reallocating funds to other opportunities.
Berkshire Hathaway’s reduction in TSMC holdings highlights the fluidity of investment strategies, and the importance of regularly reevaluating positions to determine their continued value. While TSMC has been a lucrative investment for many, Berkshire Hathaway’s move suggests that there may be other attractive investment opportunities available in the market.
Berkshire Hathaway’s recent investment
Berkshire Hathaway’s recent investment moves, revealed in a regulatory filing, show that the company is constantly adjusting its portfolio to take advantage of emerging opportunities and adapt to changing market conditions.
While the company sold nearly all of its $8.3 billion stake in Verizon Communications, it added another 20.8 million shares of Apple, bringing its stake in the company to 5.8%. This move indicates that Berkshire views Apple as a strong long-term investment, particularly given its strong track record of success in the consumer products market.
At the same time, Berkshire Hathaway significantly reduced its holdings in TSMC, US Bancorp, and BNY Mellon, while also trimming positions in other companies such as Chevron, Activision Blizzard, and Kroger. These moves suggest that the company is looking to shift its focus away from certain sectors and industries, while also freeing up capital to pursue new opportunities.