Buffett’s firm buys about $10.7B in IBM shares
Buffett said Berkshire paid an average of about $170 per share for the IBM stock.
IBM executives insist the company’s focus on long-term contracts insulates it from economic swings. The company has said it is ahead of its own aggressive forecasts. IBM has disclosed a goal of hitting $20 per share in adjusted earnings by 2015, a rare example of a long-term earnings target made public by a major company. IBM, which is based in Armonk, N.Y., says it plans to continue growing its software business and invest about $20 billion in acquisitions from 2011 to 2015.
Berkshire’s investments are closely watched in the market because of Buffett’s successful record. Buffett has said that Berkshire has been buying aggressively during the recent market turmoil.
Buffett said Monday that Berkshire had been adding to its already sizeable stake in Wells Fargo, but he didn’t say how many more shares had been bought recently. At the end of June, Berkshire held 352.3 million Wells Fargo shares. That was up from 342.6 million shares Berkshire held at the end of March.
Monday afternoon’s filing with the Securities and Exchange Commission may not reveal a full picture of Berkshire’s investments because regulators often allow the Omaha-based company to conceal new investments for a time while building a position.
Berkshire occasionally receives permission from the Securities and Exchange Commission to delay disclosing some stock purchases to prevent others from driving up the price of those stocks before Berkshire completes its purchases. Berkshire then discloses the purchases or sales in a subsequent quarter and issues amended reports for previous quarters.
The SEC says it grants such confidentiality to investment managers only when they can show they would be harmed substantially by immediate disclosure.
Buffett said that the third-quarter report that will be filed Monday won’t show all of Berkshire’s new IBM stake because some of the shares were bought in the fourth quarter.
Besides investments, Berkshire owns roughly 80 subsidiaries including insurance, railroad and utility firms.
Berkshire Hathaway Inc.: http://www.berkshirehathaway.com