Buffett hoarding billions in cash despite Restoration Hardware play
Buffett remains on the hunt for 'an elephant-sized' transaction.
Warren Buffett's Berkshire Hathaway remains on the hunt for its next big transaction but in the meantime, he's sitting on a big heap of cash.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| BRK.B | BERKSHIRE HATHAWAY INC. | 476.06 | +4.14 | +0.88% |
Berkshire made several tweaks to its portfolio during the third quarter, including initiating a $206 million stake in the luxury furniture maker Restoration Hardware and a $332 million position in the energy explorer Occidental Petroleum, according to a Securities and Exchange Commission filing released Friday. The conglomerate also reduced its stakes in the tech giant Apple, Wells Fargo and energy company Phillips 66.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| RH | RH | 367.93 | +22.36 | +6.47% |
| OXY | OCCIDENTAL PETROLEUM CORP. | 51.93 | +0.39 | +0.76% |
| AAPL | APPLE INC. | 229.87 | +1.35 | +0.59% |
| WFC | WELLS FARGO & CO. | 75.96 | +1.13 | +1.51% |
| PSX | PHILLIPS 66 | 133.26 | +1.86 | +1.42% |
The transactions, however, failed to put a dent in Berkshire’s cash pile, which swelled to a record $128 billion at the end of the third quarter despite Buffett declaring earlier this year that he was on the lookout for an “elephant-sized transaction.” He has repeatedly said that valuations are too expensive for his liking. Buffett's $37 billion acquisition of Precision Castparts was the last big "elephant" that he bagged.
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“In the years ahead, we hope to move much of our excess liquidity into businesses that Berkshire will permanently own," he wrote. "The immediate prospects for that, however, are not good: Prices are sky-high for businesses possessing decent long-term prospects."
Since then, Buffett’s cash pile has grown by about $16 billion and stock-market valuations have only gotten more expensive as the S&P 500 has rallied more than 24 percent this year touching a fresh record. The Dow Jones Industrial Average and the Nasdaq are also sitting at records.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| I:DJI | DOW JONES AVERAGES | 44296.51 | +426.16 | +0.97% |
| SP500 | S&P 500 | 5969.34 | +20.63 | +0.35% |
| I:COMP | NASDAQ COMPOSITE INDEX | 19003.651134 | +31.23 | +0.16% |
Berkshire has lagged behind the broader S&P 500 gaining 7.6 percent in 2019.