Berkshire Hathaway continues selling stocks amid market shifts

In the first quarter of 2025, Berkshire Hathaway reported significant changes in its investment portfolio amidst ongoing market volatility. The company, led by Warren Buffett, registered a net sale of $1.5 billion in publicly traded stocks, marking the tenth consecutive quarter of net selling. This quarter's activity resulted in an increased cash position and a focus on companies generating high cash flows, reflecting Buffett's cautious investment strategy during uncertain economic conditions. Berkshire’s emphasis on financial stability has led to a concentration of its portfolio, with 89% of assets in the top ten holdings and a significant focus on the financial sector. Berkshire’s notable holdings include a major position in Apple, which remains its most substantial investment at approximately 26% of the portfolio, despite not altering its stake in the company this quarter. The portfolio adjustments indicate a substantial shift, with nearly 40% of the total assets allocated to financial stocks, despite recent reductions in exposure to certain banks. Moreover, the company ceased its investments in Citigroup and Nu Holdings, consolidating its focus on healthier financial institutions. Berkshire's addition of a new secret holding valued between $1 to $2 billion highlights the company's continued search for promising investments. In parallel, the company also doubled its stake in Constellation Brands to $2.2 billion, despite skepticism regarding the impact of tariffs on its Mexican beer imports. Analysts, including James Demmert from Main Street Research, expressed concerns about the sustainability of this investment amid rising trade tensions. The first quarter's annual meeting also revealed Buffett's intention to retire as CEO by the end of the year, further emphasizing the transition phase in Berkshire Hathaway’s leadership structure. This change comes as Buffett acknowledges a preference for maintaining higher cash reserves and Treasury bills rather than being overly active in stock purchases, signaling a potential shift in the company's investment philosophy moving forward. The combination of these factors positions Berkshire Hathaway cautiously as it adapts to changing market dynamics.