Skip to content

Buffet's Hidden Portfolio Worth $642 Million is Offloading Potentially Enticing AI Stock, Considered a Highlight in Wall Street Investments

The Investment Portfolio of the Oracle of Omaha Holds 120 Assets, Including a Historically Affordable AI-Related Share.

Buffett enveloped by a throng at Berkshire Hathaway's yearly shareholder event.
Buffett enveloped by a throng at Berkshire Hathaway's yearly shareholder event.

Buffet's Hidden Portfolio Worth $642 Million is Offloading Potentially Enticing AI Stock, Considered a Highlight in Wall Street Investments

Warren Buffett, the legendary CEO of Berkshire Hathaway (BRK.A 1.42%, BRK.B 1.11%), has attracted both professional and everyday investors for decades due to his impressive track record. Spanning six decades, Buffett's leadership has led to a staggering 5,385,000% gain in Berkshire Hathaway's Class A shares (BRK.A).

Form 13F filings with the Securities and Exchange Commission grant investors a glimpse into Buffett's investment strategy, highlighting the stocks he's actively purchasing and selling. Buffett oversees a sizable portfolio of 44 stocks, valued at a substantial $292 billion.

However, these filings barely scratch the surface of Berkshire Hathaway's total holdings. One of Buffett's strategies to grow his company has been acquiring businesses, like insurer GEICO and railroad BNSF. A notable example of this is the 1998 acquisition of reinsurance company General Re for $22 billion. The deal included General Re's specialty investment fund, New England Asset Management (NEAM).

While Buffett doesn't manage NEAM's portfolio daily, the fund remains a crucial part of Berkshire Hathaway. NEAM, valued at $642 million, is beyond the reporting limit required to file a quarterly 13F. This means investors can closely monitor NEAM's stock purchases and sales every three months, ensuring they don't miss any hidden investment opportunities.

NEAM's investment approach mirrors Buffett's value-oriented style, making it a natural extension of Berkshire Hathaway's investment philosophy. Despite a historically expensive market, NEAM has been a consistent seller of high-growth tech stocks, including popular AI companies like Nvidia and Microsoft.

An individual scrutinizing a virtual display, featuring responses generated by a digital chatbot.

However, NEAM's recent sell-off of Google parent company Alphabet (GOOGL 1.60%, GOOG 1.62%) might reveal a compelling investment opportunity. Alphabet, which boasts industry-leading search engine market share and impressive ad-pricing power, clocked in with a 10% share of global cloud service spending in Q3. This strong performance, coupled with its undervalued stock, suggests that Buffett's "secret" portfolio might be missing out on a significant growth opportunity.

With Alphabet trading at historically cheap valuations, the dramatic sell-off by NEAM may prove to be a mistake in the making.

[1] Buffett's "secret" portfolio includes value-oriented investments, including a historically undervalued stock in the artificial intelligence sector, among other holdings. These specific holdings are not publicly disclosed in Berkshire Hathaway's quarterly 13F filings.

Buffett's investment strategy extends beyond the publicly disclosed stocks in Berkshire Hathaway's portfolio, as his "secret" portfolio, managed by New England Asset Management, includes undervalued stocks like a historically cheap AI sector company. Intriguingly, NEAM recently sold off a significant amount of Alphabet's stocks, potentially missing out on its growth potential.

The substantial undervaluation of Alphabet, known for its leading search engine market share, strong ad-pricing power, and significant presence in cloud services, could make NEAM's sell-off an opportunity to reconsider investment in this company.

Read also:

    Comments

    Latest