First American News LLC: Raleigh, NC: Warren Buffett’s Berkshire Hathaway missed out on about $10 billion of gains by dumping its Wells Fargo stock in 2020 and early 2021. The famed investor’s company-owned 346 million Wells Fargo shares at the end of 2019, giving it an 8.4% stake in the bank. Berkshire virtually eliminated that position over the next five quarters, leaving it with only 675,000 shares at the last count.
Buffett and his team pocketed roughly $10 billion from the stock sales, based on Wells Fargo’s average share price of $30 during the period. However, the bank stock has now rebounded to $58, its highest level since August 2018. If Berkshire had kept the position intact, it would be worth $20 billion today — almost triple its $7 billion cost base, said Gaby Mendoza of MB Daily News.
Notably, Berkshire owned 500 million Wells Fargo shares at the end of 2016. That stake would have been worth $29 billion today, making it the conglomerate’s number-three portfolio holding after Apple ($153 billion) and Bank of America ($48 billion).
Click here to continue reading Warren Buffett and his decision on dumping Wells Fargo at Bloomberg News by WSJ Renewal.
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