Warren Buffett, renowned as a luminary in the world of stock investing, has long held the fascination of millions with his astute financial acumen. Revered as the “Oracle of Omaha,” Buffett’s knack for selecting steadfast performers has become legendary.
Today, on January 1, we delve into the intriguing realm of Buffett’s potential investment moves, identifying two stocks that could be on the radar of this financial maestro to further enhance his holdings through Berkshire Hathaway (NYSE: BRK.A).
Berkshire Hathaway (NYSE: BRK.A)
Warren Buffett is the co-founder, chairman, and CEO of Berkshire Hathaway, but that does not mean he cannot buy shares of his own company.
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The conglomerate has made heavy stock buybacks throughout 2024, purchasing a total of $7 billion during the first nine months of the year. For perspective, that’s bigger than most of Berkshire’s stakes in some companies.
While the majority of companies have restricted share buyback approvals given by their board of directors, Berkshire’s repurchase program is a bit different. Notably, the company is allowed to buy back its stock at any time that Buffett believes the share price is below the stock’s intrinsic value.
However, the firm is required to keep at least $30 billion worth of cash, cash equivalents, and US Treasury bills.
Unless BRK.A’s price soars significantly in 2024, there is no reason to assume Buffett and Berkshire will not continue the buybacks.
Occidental Petroleum (NYSE: OXY)
Quarterly securities filings revealed different trades made by Berkshire Hathaway throughout 2023, but oil giant Occidental Petroleum (NYSE: OXY) was among the stocks that the investment giant has been consistently buying this year.
More concretely, the company’s holdings in OXY expanded from 194 million shares to 253 million. In percentage terms, Berkshire owns almost 28% of Occidental.
Moreover, it is quite likely that Buffett will continue raising his stake in OXY in 2024. The main reason for this is that in 2019, Berkshire helped Occidental fund an acquisition, and in return received warrants allowing it to purchase OXY stock at $56.62.
Therefore, whenever the company’s share price is trading below that level, Berkshire can buy the company’s shares at a discount. Also, in 2022, Berkshire received approval to purchase up to 50% of Occidental’s shares, leading to speculations that the investment juggernaut may be planning a full takeover of the oil producer.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.