Warren Buffett has been a net seller of stocks for seven consecutive quarters. He has also built Berkshire HathawayThe company’s cash, cash equivalents and short-term investments reached nearly $277 billion, the largest cash stockpile in the company’s history.
Has the legendary investor thrown in the towel on the stock market? Not completely. Buffett just bought shares in seven companies. I think one of them stands out as the best of the bunch.
Adding more
Buffett added to Berkshire’s existing positions in five stocks in the second quarter of 2024. I wasn’t surprised that Occidental Petroleum (NYSE: OXY) was one of them. Buffett is a big fan of Occidental and the company’s CEO, Vicki Hollub. The stock is Berkshire’s sixth-largest holding.
Berkshire’s purchase of more than 1.1 million shares of Chubb (NYSE: CB) The second-quarter results are no surprise, either. Buffett began buying the insurer last year without disclosing the identity of the shares. He has invested heavily in Chubb in recent quarters. It is now the ninth-largest holding in Berkshire’s portfolio.
Buffett’s three other additions to existing positions in the second quarter share a common denominator. He increased Berkshire’s stakes in Liberty Media Corp. Series A (NASDAQ: LSXMA) And Liberty Media Corp Series C (NASDAQ: LSXMK)Buffett also purchased an additional 96.2 million shares of Sirius XM Holdings (NASDAQ: SIRI)strengthening Berkshire’s position in the satellite radio operator by more than 262%. Liberty Media owns more than 83% of Sirius XM’s outstanding shares.
New positions
Ultimate Beauty (NASDAQ: ULTA) This is Berkshire Hathaway’s largest new position of the second quarter. Buffett and his team bought more than 690,000 shares of the cosmetics retailer, worth about $266 million, by the end of the second quarter.
Buying Ulta feels like a classic buy on a downturn. Ulta shares are down about 20% year to date, and much of that decline is due to the company’s disappointing full-year guidance. Ulta CEO Dave Kimbell has warned that consumer spending on beauty has slowed.
Buffett also launched a new position in Hi (NYSE: HEI) In the second quarter, Heico bought more than a million shares of the aerospace and electronics company. Unlike Ulta Beauty, Heico has seen solid gains in 2024, with its stock up nearly 35%.
Business is booming for Heico. The company reported record revenue and earnings for the second quarter of fiscal 2024, announced in May. Acquisitions continue to be a key growth driver for Heico.
The best of the group
If you’re an income-oriented investor, you might be attracted to Sirius XM’s juicy forward dividend yield of 3.6%. dividend distribution rate of 31.5% is also low, indicating financial flexibility that could allow it to increase the dividend.
If you’re a value investor, both Liberty Media stocks might be a better fit for you. Both are trading at a forward earnings multiple of less than 6.3. Analysts polled by LSEG We also expect Liberty Media to generate strong earnings growth over the next five years.
However, I think Occidental Petroleum is the best stock overall among…
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