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Berkshire Hathaway Adjusts Portfolio: Reduces Paramount Stake and Exits Key Holdings

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Ticker Tea
February 15, 2024

đź“ť SUMMARY: In a significant move that has caught the attention of the investment community, Warren Buffett's Berkshire Hathaway Inc. ($BRK.B) has adjusted its investment portfolio, reflecting a strategic shift in its asset allocation. The Omaha, Nebraska-based conglomerate made headlines with its decision to cut its stake in Paramount Global ($PARA) by approximately 30.4 million shares, or about a third of its previous holding, during the fourth quarter. This reduction prompted a 6.7% drop in Paramount's shares to $12.31 in extended trading, exacerbating the stock's 11% decline through the year's regular trading sessions.

Berkshire Hathaway's portfolio adjustment did not stop with Paramount. The firm also exited its investments in D.R. Horton Inc. ($DHI), a leading homebuilder, as well as in Markel Group Inc. ($MKL), StoneCo Ltd. ($STNE), and Globe Life Inc. ($GL). These exits reflect Berkshire's ongoing portfolio optimization efforts, guided by Buffett's investment philosophy of concentrating on companies with strong fundamentals and growth potential.

In addition to these exits, Berkshire Hathaway reduced its stakes in technology giants HP Inc. ($HPQ) and Apple Inc. ($AAPL), the latter remaining its top holding despite the reduction. Conversely, the firm increased its investments in the energy sector, boosting its stakes in Chevron Corp ($CVX) and Occidental Petroleum Corp ($OXY). This reallocation underscores Berkshire's bullish outlook on the energy sector amid fluctuating market conditions and its strategy to diversify its investment focus.

The adjustments in Berkshire Hathaway's portfolio come at a time when Paramount Chair Shari Redstone is exploring strategic options, including a potential sale of her family’s controlling stake in the business. With media mogul Byron Allen expressing interest in acquiring the entire company, the media and entertainment landscape could see significant changes, influenced in part by Berkshire's investment decisions.

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