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Warren Buffett’s Berkshire Hathaway cashed out $158 million of HP stock in three days this week.
The investor’s company still holds an 11.7% stake in the PC maker, worth about $3.3 billion.
HP’s stock hit a record high last year after Berkshire disclosed its stake, but it has fallen 32% since then.
Warren Buffett’s Berkshire Hathaway sold about $158 million worth of HP stock in three days this week, a regulatory filing on Wednesday showed.
The well-known investor group sold 5.5 million shares at prices between $28 and $30, reducing its stake by 4.5% to 115 million shares. As a result the ownership of HP’s largest shareholder fell from 12.2% to 11.7%.
HP stock hit an all-time intraday high of $41.47 the day after Berkshire first disclosed its position in April last year, but has since fallen 32% to $28.33 at Wednesday’s close. The stock-price decline and Berkshire’s recent disposal have reduced the value of Berkshire’s stake from $5 billion at its peak to $3.3 billion today.
Hewlett-Packard spun off its enterprise business in 2015, retaining its PC and printer businesses under the HP name. Bill Hewlett and David Packard founded the company in a California garage in 1939, when Buffett — who turned 93 last month — was just 8 years old.
Buffett has famously shunned technology companies in favor of simpler, safer and more predictable businesses. However, he counts Apple – which was founded by Steve Jobs and Steve Wozniak, who both worked at Hewlett-Packard – as by far the largest position in his stock portfolio, and he calls it “our It is promoted as “a better business than any owned business”.
It’s unclear why the investor and his team cut their HP stake, but they were likely attracted to the company because of its modest valuation. HP generated nearly $63 billion in net revenue and $5 billion in operating income last fiscal year, yet its market capitalization was only $28 billion as of Wednesday’s close.
Buffett has struggled to find attractively priced stocks and businesses to buy for the past few years. Berkshire sold a net $8 billion of shares in the second quarter, and the pace of buybacks slowed to $1.4 billion in the period, helping boost its cash pile 13% to near a record $147 billion.
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