For years, the technology giant Apple (NASDAQ: AAPL) has been the single biggest holding in the portfolio of the legendary investor Warren Buffett.
More recently, things have changed with The Oracle of Omaha selling significant amounts of AAPL stock, reducing its share in the portfolio from about 50% to approximately 40%, thus losing more than $4 billion in potential gains.
Meanwhile, by mid-June 2024, another company appeared to be slowly taking Apple’s place among Warren Buffett’s largest holdings: Occidental Petroleum (NYSE: OXY).
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Warren Buffett now controls 29% of OXY
Warren Buffet has been fairly confident in Occidental’s future since at least 2022, initially taking advantage of the then-volatile oil market.
Though the famous investor has been gradually increasing his stake ever since, June 2024 saw an explosion in buying activity as The Oracle of Omaha went on a 9-day unbroken buying offensive.
Though Buffett stated he had no intention of taking full control of the company, he increased his stake to just under 29% and, by the time of publication, held more than 255 million shares.
Part of the reason behind the increased backing for Occidental is that on June 4, the company announced a partnership with Berkshire Hathaway (NYSE: BRK.A, BRK.B) focused on lithium mining.
Lithium is a crucial mineral for the production of lithium-ion batteries – the main power source for modern electric vehicles (EVs).
Due to the expected rise in the market share of EVs, lithium is frequently cited as the oil of the 21st century and, indeed, numerous fossil fuel companies have begun investing heavily in the extraction and refining of the mineral.
Occidental Petroleum stock price
Despite Buffett’s backing, OXY stock hasn’t shown particular strength during the first half of 2024.
Indeed, while the company is in the green in the year-to-date (YTD) chart by 2.01%, it has failed to hold on to a far greater price it achieved following a major rally that lasted from mid-February to early April.
Given that OXY’s price today, at press time, stands at approximately $61.26, it is more than 11% below its yearly highs above $69, and its more recent moves have been downward.
Nonetheless, experts and analysts remain highly bullish on Occidental Petroleum’s prospects and data retrieved from the stock analysis platform TradingView reveal the company boasts an average ‘buy’ rating and overall 12-month price target of $72.59.
Additionally, some consider it likely OXY shares will experience a stock market climb up to $90 and even the most bearish predictions place the firm’s price in one year’s time above where it was at the time of publication at $63.
Ultimately, the bullish predictions – particularly when paired with the recent downturn and the lithium mining plans – may reveal the main reasons why Buffett has been on a buying spree in the first half of June.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
