- Warren Buffett has racked up $US17 ($22) billion in gains across just five stocks this year.
- Berkshire Hathaway’s Bank of America stake has soared in value by $US9 ($12) billion.
- Buffett is up more than $US1 ($1) billion on Kraft Heinz, GM, and US Bancorp in 2021.
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Warren Buffett is winning big from the flight to value stocks ahead of the global economy reopening this summer. The famed investor’s Berkshire Hathaway conglomerate has notched an astounding $US17 ($22) billion in gains across only five stocks this year.
Buffett’s company is up $US9 ($12) billion on Bank of America alone. The banking group’s stock price has surged 30% since the start of January, boosting the value of Berkshire’s enlarged stake from $US30 ($39) billion to $US39 ($50) billion.
Moreover, Berkshire has scored a $US3.7 ($5) billion gain on American Express, as the financial-services group’s stock has jumped 30% this year. It has also made $US1 ($1).5 billion on Kraft Heinz, $US1 ($1).4 billion on General Motors, and $US1 ($1).3 billion on US Bancorp in under three months.
Buffett’s bets on five Japanese trading houses last fall are delivering too. Itochu, Mitsui, Marubeni, Mitsubishi, and Sumitomo shares have gained an average of 26% this year, lifting the combined value of Berkshire’s holdings by $US1 ($1).6 billion.
Other Berkshire investments are outperforming as well. Chevron, Suncor Energy, and Synchrony Financial have all climbed more than 20% this year, while Wells Fargo – previously one of Berkshire’s biggest holdings – has rallied 37%. Meanwhile, the benchmark S&P 500 index is up 5.8% this year.
However, Berkshire’s gains have been partly offset by the recent exodus from tech stocks. Apple – which makes up more than 40% of Buffett’s US stock portfolio – has slumped 7% this year. The decline has wiped close to $US8 ($10) billion off the value of Berkshire’s stake.
Berkshire has also taken a hit from Coca-Cola, leaving its shares worth about $US900 ($1,163) million less today than at the start of January. The company’s also down about $US400 ($517) million on both Snowflake and Verizon.
Buffett’s signature approach of sniffing out high-quality, undervalued businesses and investing for the long term is finally paying off. Yet if growth stocks do take off again, his Apple wager will likely flourish. It appears Buffett’s found a way to have his cake and eat it too.
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