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Buffett's Berkshire pares drug holdings, sheds Axalta, Biogen

Published 08/16/2021, 05:41 PM
Updated 08/16/2021, 05:47 PM
© Reuters. FILE PHOTO: A sign marks a Biogen facility in Cambridge, Massachusetts, U.S. January 26, 2017.  REUTERS/Brian Snyder
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By Jonathan Stempel

(Reuters) - Warren Buffett's Berkshire Hathaway (NYSE:BRKa) Inc said on Monday it trimmed or eliminated its stakes in several pharmaceutical companies, and reported a small new stake in a Merck & Co spinoff, Organon & Co.

In the second quarter, Berkshire said it exited a $180 million stake in Biogen Inc (NASDAQ:BIIB) and reduced investments in Abbvie Inc, Bristol-Myers Squibb (NYSE:BMY) Co and Merck.

It also shed a $411 million stake in paint maker Axalta Coating Systems (NYSE:AXTA) Ltd, a Berkshire holding since 2015.

The changes were disclosed in a regulatory filing detailing Berkshire's U.S.-listed holdings as of June 30.

Berkshire has been a net seller of stocks in 2021, including in the second quarter when it sold $1.1 billion more stocks than it bought.

That suggests Buffett and his investment managers Todd Combs and Ted Weschler remain wary of valuations as stock prices regularly set new highs.

The Standard & Poor's has doubled from its March 2020 trough early in the COVID-19 pandemic.

Berkshire has instead bought back about $14.3 billion of its own stock between January and late July though its share price also set records, and now sits just 2% below its May 7 peak.

The Omaha, Nebraska-based conglomerate ended June with $144.1 billion of cash and equivalents. Berkshire also owns dozens of businesses including the BNSF railroad, Geico auto insurance and Dairy Queen ice cream.

Organon specializes in contraception and other women's health products, and has dozens of brands in other fields.

Berkshire reported a $46.9 million Organon stake as of June 30.

Its largest investments on that date were $124.3 billion in Apple Inc (NASDAQ:AAPL) and $42.6 billion in Bank of America Corp (NYSE:BAC).

© Reuters. FILE PHOTO: A sign marks a Biogen facility in Cambridge, Massachusetts, U.S. January 26, 2017.  REUTERS/Brian Snyder

In Monday's filing, Berkshire also reported lowered stakes in Chevron Corp (NYSE:CVX), General Motors Co (NYSE:GM), media company Liberty Global Plc (NASDAQ:LBTYA), insurance broker Marsh & McLennan Cos and US Bancorp (NYSE:USB).

It reported increased stakes in supermarket chain Kroger (NYSE:KR) Co, home furnishings chain RH (NYSE:RH) and Marsh rival Aon (NYSE:AON) Plc, which under regulatory pressure called off a $30 billion merger with Willis Towers Watson (NASDAQ:WLTW) Plc last month.

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