Andrew Bary
Berkshire Hathaway's worst investment move in the past decade probably was its sale of bank stocks, with the company leaving more than $50 billion on the table in potential profits, Barron's estimates.
The surge Thursday in Goldman Sachs to a new high after its fourth-quarter profit release underscores that mistake.
At the end of 2019, Berkshire held sizable stakes in six of the top 10 banks in the country -- Bank of America, Bank of New York Mellon, Goldman Sachs, JPMorgan Chase, U.S. Bancorp and Wells Fargo.
The only one that remains is Bank of America and Berkshire has reduced that stake by more than 40% in the past 18 months to about 568 million shares, a holding now worth about $30 billion.
Berkshire held 18 million shares of Goldman at the end of 2018 stemming largely from a $5 billion preferred stock investment during the 2008 financial crisis that came with equity warrants.
Berkshire sold the Goldman stake in 2019 and the first half of 2020 at what Barron's estimates is an average price of about $225 a share. Goldman stock has more than quadrupled since then and now trades at $964. The Berkshire interest would now be worth $17 billion.
Probably the worst sale was what once was a 10% stake in Wells Fargo that Berkshire began accumulating around 1990. Berkshire held nearly 450 million shares at the end of 2018. Most of the interest was sold in 2020 at a price that we estimate was in the high 20s. Wells Fargo now trades around $90.
That sale alone probably has cost Berkshire about $25 billion in lost profits, and Berkshire didn't generate much in gains over a long holding period since its average cost was $24 a share.
Barron's estimates that Berkshire probably has left over $50 billion on the table from its sales of the six bank stocks plus the 40% reduction in its interest in Bank of America.
Chairman Warren Buffett, who likely made those sell calls, hasn't said much publicly about why Berkshire unloaded the bank stocks, after he said in the late 2010s that he felt banks were appealing because of low valuations and ample returns, singling out JPMorgan. Berkshire didn't respond to a request for comment.
Berkshire held about 60 million shares of JPMorgan at year-end 2019 and sold that stake during 2020 at what we estimate is around $100 a share. JPMorgan now trades at $315.
Berkshire has made a few notable winning equity investment moves over the past six years. The biggest score has been the purchase of five Japanese trading companies. Berkshire paid about $15 billion and those stakes are collectively worth close to $40 billion.
Other stock purchases in recent years didn't pan out or were ended too soon.
Berkshire's holding Occidental Petroleum accumulated from 2022 to 2025 is now worth about $11.5 billion, or about $2 billion less than what we estimate is its cost basis. Buffett's buy of a 10% stake in Paramount Global resulted in a sizable loss and Berkshire probably broke even on its investment in HP.
Berkshire bought about 60 million shares of Taiwan Semiconductor in 2022 and quickly sold them at what also appeared to be around breakeven at $80 a share. The stock now trades at $342.
Buffett talks about his favorite holding period being "forever," but he has rarely lived up to that. Coca-Cola and American Express probably are the only forever stocks in Berkshire's $300 billion-plus portfolio. Moody's is a maybe in the forever camp.
Look back a decade or more and Berkshire sold stakes in Walmart, IBM, ExxonMobil and Costco Wholesale.
Buffett suggested in annual shareholder letters that Apple might be a forever stock, but he has slashed that holding by about 75% over the past two years to 238 million shares now worth $60 billion. Berkshire likely made over $100 billion on the investment -- its biggest score ever. Barron's estimates that it sold Apple at an average price of about $190, against a cost basis of $35. Berkshire, however, has left a lot on the table with the shares now trading at $257.
All this highlights that Buffett has paid a price for not heeding his forever mantra.
Write to Andrew Bary at andrew.bary@barrons.com
This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
January 16, 2026 16:21 ET (21:21 GMT)
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