To The Moon

“If you do it at the right price, there’s nothing better than buying back part of your own business,” Buffett said at Berkshire’s annual shareholders meeting on Saturday.

Let's see what stocks have been added to his portfolio

$Occidental(OXY)$

Buffett's Berkshire Hathaway again loaded up on Occidental Petroleum stock this week purchasing 5.9 million shares for about $345 million. He purchases shares on Monday and Tuesday for average per-shares prices ranging from $55.99 to $58.37, according to anSEC filing. The purchases bring Berkshire's stake to 142.3 million shares.

In the first quarter, Berkshire purchased $7.0b worth of the Occidental. Buffett noted at the Berkshire annual meeting over the weekend that he was able to buy 14% of the petroleum refinerover only a two-week period.

$Chevron(CVX)$

Among Berkshire’s largest buys in the first quarter were Chevron and Occidental Petroleum. Those are both big oil producers, with generous cash-return plans. Buffett likes companies that buy back a lot of stock and pay big dividends. Share buybacks mean Berkshire’s ownership stake will rise over time, and dividends throw cash back to the parent company to redeploy elsewhere.

A first-quarter surge in oil prices means lots of earnings and free cash flow to fund those shareholder-return programs at Chevron and Occidental. And both stocks carry valuation multiples well below the S&P 500 average. The index trades at about 18 times expected earnings for the coming year. Chevron stock goes for less than 11 times and Occidental goes for just 7.5 times.

The energy buys weren’t even contrarian in the first quarter: Chevron stock returned 40% including dividends, while Occidental soared 96%. Berkshire likely bought some $17 billion worth of Chevron and about $7 billion of Occidental in the period.

$Activision Blizzard(ATVI)$

Buffett revealed on Saturday that Berkshire had increased its stake in Activision Blizzard to about 9.5% since the start of 2022, suggesting purchases of around $4.5 billion this year. It’s hard to imagine the 91-year-old Buffett being a big videogame enthusiast, and, sure enough, the Activision bet doesn’t have anything to do with the business—it’s a merger-arbitrage play.

Microsoft has agreed to purchase Activision for $95 a share, but the shares have been trading in the high $70s and low $80s in recent months. Buffett expects the deal to go through and for that gap to close. Once again, it’s a straight forward, company-specific thesis.

SHARE YOUR THOUGHTS

• Will you add more shares?

• Evs, Oils and Gas: Which one do you hold?

You may be rewarded with Tiger Coins for posting a comment💸💸💸

Follow me! Don't forget I am the richest tiger in this community😎😎