Buffett continues to adjust the portfolio: the sale of shares of Bank of America for more than 3 billion dollars

Berkshire Hathaway, headed by legendary investor Warren Buffett, has announced a significant sale of Bank of America shares worth more than $3 billion. This happened in July 2024 and became part of Buffett's strategy to optimize the investment portfolio.

Berkshire Hathaway sold 18.4 million shares of the bank worth $767 million between July 25 and July 29, Reuters reported. In general, from July 17 to the end of the month, 71.2 million shares of Bank of America were sold for the amount of 3.05 billion dollars. That reduced Berkshire Hathaway's stake in the bank by 6.9%, leaving the company with 961.5 million shares.

Despite the sale, Berkshire Hathaway still owns about 12.4% of Bank of America, which has a total value of about $39.5 billion. Buffett will continue to be required to report stock sales until his stake falls below 10%.

Note that the price of Bank of America shares has increased by almost two-thirds since the end of October 2023. The stock is currently trading at 1.2 times book value, while the stock has traded below book value for most of the past decade.

Berkshire Hathaway first bought $5 billion worth of Bank of America preferred stock in 2011. At the time, investors were concerned about the possibility of the bank running out of capital after paying off significant mortgage and legal obligations left over from the 2008 financial crisis.

This sale of Bank of America shares underscores the ongoing adjustments in Buffett's investment portfolio, which actively adapts its strategies to changes in the market and economic conditions.