Berkshire Hathaway Slashes Stake in Taiwan Semi. What Else Buffett Sold.

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Berkshire Hathaway

slashed its stake in

Taiwan Semiconductor

during the fourth quarter and nearly eliminated what had been a large stake in

U.S. Bancorp
,
according to filings late Tuesday.

Berkshire Hathaway (ticker BRK/A, BRK/B) reduced its interest in Taiwan Semiconductor (TSM) to 8.3 million shares in the fourth quarter from 60 million shares in the third quarter, a drop of 86%. The stake in U.S. Bancorp (USB) fell to 6.7 million shares from 52.5 million shares, according to a13-F filing Tuesday.

The news of the cut in the Taiwan Semiconductor stake is depressing shares of the huge chip maker in after-hours trading. The stock is down 3.3% to 94.70 after gaining 1.9% to 97.96 during regular trading Tuesday.

The sharp reduction in the Taiwan Semiconductor stake came just a quarter after Berkshire built the position, which totaled $4.2 billion at the of the third quarter. Berkshire likely made a profit on the holding given that Taiwan Semiconductor gained about 10% in the fourth quarter to end the year at $74. But Berkshire has missed out on big gains in the stock so far this quarter.

The slashing of the Taiwan Semiconductor stake was a surprise since many investors assumed that Berkshire CEO Warren Buffett or his investment lieutenants, Todd Combs and Ted Weschler, had established a long-term holding in the semiconductor producer.

There were no new sizable purchases by Berkshire in the fourth quarter. That’s unusual for the company which usually builds a stake in at least one company each quarter.

Berkshire has churned through many smaller holdings in a $350 billion portfolio in recent years, including

Verizon Communications

(VZ), as well as some financial and drug stocks. This conflicts with Buffett’s oft-stated view that his favorite holding period is forever.

Berkshire, however, made little or no change in its largest holdings in the fourth quarter:

Apple
,

Bank of America

(BAC),

Chevron
,

Coca-Cola

(KO), and

American Express

(AXP). Aside from Chevron, which was largely bought in 2022, Berkshire has done little or nothing with the largest holdings in the past two years.

The longtime U.S. Bancorp holding stood at 143 million shares at the end of 2021 and fell 95% by year-end 2022.

Berkshire has been an active seller of bank stocks in recent years, eliminating holdings in

JPMorgan Chase

(JPM),

Goldman Sachs Group

(GS), and

Wells Fargo

(WFC). The U.S. Bancorp and

Bank of New York

stakes are down sharply. Berkshire has left more than $10 billion on the table given the rally in the stocks since their sales. Buffett seems to want to concentrate Berkshire’s bank investments in Bank of America in which it holds about one billion shares worth around $36 billion.

There were some other changes in the Berkshire portfolio reported in the 13-F report. The company’s stake in Chevron (CVX) fell by about two million shares to 163 million shares in the fourth quarter.

Berkshire bought two million shares of

Paramount Global

(PARA) and held 93.6 million shares at year-end.

Berkshire’s largest holding, Apple (AAPL), was up by roughly 300,000 shares to 895.1 million shares, and likely reflected the inclusion of Apple stock held by Alleghany, the insurer that Berkshire bought in the fourth quarter.

It appears that Berkshire sold nearly all the stocks in the $2 billion Alleghany portfolio after the deal closed in October.

Earlier Tuesday, Berkshire disclosed in 13-G separate filings that it reduced its holdings in Bank of New York (BK) and

Activision Blizzard

(ATVI) in the fourth quarter. The Bank of New York stake fell to 25 million shares from 62.2 million shares and the Activision interest declined by 7.3 million shares to 52.7 million shares.

The 13-F filing is quarterly and the 13-G filings are made annually for holdings in which Berkshire holds stakes of 5% or more. The Berkshire 13-G filings are more comprehensive than the 13-F filings since they include holdings of New England Asset Management, an investment manager owned by Berkshire General Re unit.

Berkshire’s total holding in Apple, for instance, is 915.6 million shares, reflecting about 20 million shares held by New England Asset Management.

Write to Andrew Bary at [email protected]