Warren Buffett Reduced Holdings of BYD: Why & Do You Still Bet Bullish？
Warren Buffett’s investment firm $Berkshire Hathaway(BRK.A)$ $Berkshire Hathaway(BRK.B)$ said it sold shares of Chinese electric-vehicle maker $BYD COMPANY(01211)$ for about $46 million. Berkshire Hathaway Inc. sold 1.33 million of BYD’s Hong Kong-listed shares last Wednesday at an average of 277.10 Hong Kong dollars a share, equivalent to around $35 a share.
The sale, which came days before the car maker said its January-June profit tripled compared with a year ago, reduced Berkshire’s holdings in BYD from 220 million shares to 218.7 million shares, according to the filing.
$BYD COMPANY(01211)$
BYD’s Hong Kong-listed shares slumped 11% in Wednesday morning trading to their lowest level since mid-May.
Earnings
The Shenzhen-based auto company’s net profit attributable to ordinary shareholders in the first six months of this year soared to about 3.6 billion yuan, equivalent to around $520 million, from 1.2 billion yuan a year earlier, according to its earnings report filed Tuesday. The company releases earnings reports every six months. Robust growth in its car sales drove up BYD’s revenue by 66% to 151 billion yuan.
In a pivot to selling electric cars, BYD said it stopped producing traditional combustion-engine vehicles in March. The company sold 324,000 battery cars globally and about 315,000 plug-in hybrid electric cars in the six months through June.
Purchase history
In September 2008, Buffett bought 225 million BYD H shares at a price of HK$8 per share, accounting for about 10% of its post-allotment share ratio, and the total transaction amounted to about HK$1.8 billion. According to the price reduction on August 24, not counting dividends and other factors, Buffett's holdings of BYD H shares have increased in value by about 33.64 times.
Why Warren Buffett quietly left the market amidst the performance and stock price explosion? How to evaluate Warren Buffett's investment approach? Analysts believe that Warren Buffett's principle of selling stocks is mainly cost-effective, followed by the possibility of better investment targets. Buffett sold BYD when the U.S. interest rate hike and tapering. The valuation of U.S. stocks is cheap, this time he turned to buy other underlying, there is this possibility.
Warren Buffett reduced holdings of BYD, are you bullish on the new energy industry?
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After 14 years of holding BYD shares, Warren Buffett has just sold his shares and this has caused a huge sell off.
I believe Warren Buffett is taking profits and redeploying his funds to other companies that he believes in that is selling below their intrinsic value. Warren Buffett is an astute investor with a Midas touch. He has made a huge profit from his disposal of BYD shares.
Is BYD a buy now? The current share price is HKD 242.20, down 7.91% since yesterday. I believe the sell off will still continue for the next 1 to 2 weeks. If it dips below 200, then it looks very attractive to buy.
BYD ticks all the core fundamentals of a quality stock. It has just announced a sterling earnings report. Q2 net profit shot up 197% with revenue up 68%. Net profit leapt 245%.
I believe BYD is a BUY and this is a golden opportunity to do so. Short term pain but long term gain.
@MillionaireTiger @TigerStars
portfolio
Maybe he went and bought so Tesla shares?
New energy just got started
Of course, you have to be invested
Remember to buy the right companies, not the loss making ones
Out companies by asking them to sell him issued call options at cheap prices as usual .
I'm expecting WB to buy in another new energy stock soon.