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. | 405.24 | +5.63 | +1.41% |
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 | 240.31 | -4.76 | -1.94% |
| OXY | OCCIDENTAL PETROLEUM CORP. | 66.64 | +0.60 | +0.91% |
| AAPL | APPLE INC. | 165.00 | -2.04 | -1.22% |
| WFC | WELLS FARGO & CO. | 60.35 | +1.61 | +2.75% |
| PSX | PHILLIPS 66 | 154.71 | +1.40 | +0.91% |
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 | 37986.4 | +211.02 | +0.56% |
| SP500 | S&P 500 | 4967.23 | -43.89 | -0.88% |
| I:COMP | NASDAQ COMPOSITE INDEX | 15282.009722 | -319.49 | -2.05% |
Berkshire has lagged behind the broader S&P 500 gaining 7.6 percent in 2019.