August 14, 2014 / 9:08 PM / 5 years ago

Buffett's Berkshire reveals Charter stake, cuts DirecTV

NEW YORK (Reuters) - Warren Buffett’s Berkshire Hathaway Inc (BRKa.N) disclosed a new $366 million stake in cable TV operator Charter Communications Inc (CHTR.O) and pared its holdings in two other pay-TV companies, part of a flurry of changes in its stock investments during the second quarter.

Berkshire Hathaway shareholders walk by a video screen at the company's annual meeting in Omaha May 4, 2013. REUTERS/Rick Wilking/Files

Shares of Charter shares rose about 2 percent after-hours after Berkshire reported a new 2.3 million share stake, according to a U.S. Securities and Exchange Commission filing that detailed its domestic equity investments as of June 30.

Charter is “the play of choice on cable consolidation,” said Wunderlich Securities analyst Matthew Harrigan.

“You’ve got a good story on an as-is basis and if they do more deals they can do a lot more value,” he said.

DirecTV DTV.O is awaiting regulatory approval to sell itself to AT&T (T.N) for $48.5 billion.

Charter declined to comment. A message left with DirecTV was not immediately answered.

Shares of companies often rise after Berkshire reveals new investments because some investors consider it a vote of confidence by Buffett and try to copy him.

Berkshire did not disclose whether the Charter investment was made by Buffett or one of his portfolio managers, Todd Combs and Ted Weschler.

Buffett has said he generally makes Berkshire’s larger investments such as Wells Fargo & Co (WFC.N) and Coca-Cola Co (KO.N), while other investments, especially in sectors he is less familiar with, are often made by Combs or Weschler, who have smaller sums to invest.

Within the pay TV sector, Berkshire said its stake in DirecTV fell by about 11 million shares since the end of March to 23.5 million. It is also no longer reporting any stake in premium TV cable network Starz STRZA.O.

The sales of stocks contributed to a significant increase during the quarter in Berkshire’s cash pile, which ended June at $55.5 billion.

That gives Buffett power to make at least one big acquisition and still retain his desired $20 billion cushion.

In Thursday’s filing, Berkshire reported a new stake in Now Inc (DNOW.N), an energy distribution business recently spun off from oilfield equipment provider National Oilwell Varco Inc (NOV.N), whose stock Berkshire also owns.

Among the companies in which Berkshire reported higher share stakes were General Motors Corp (GM.N), IBM Corp (IBM.N), Suncor Energy Inc (SU.TO), Verizon Communications Inc (VZ.N) and Wal-Mart Stores Inc (WMT.N).

It also reported lower holdings in many companies, including oil company ConocoPhillips (COP.N), former Washington Post owner Graham Holdings Co (GHC.N), National Oilwell Varco, and former Starz owner Liberty Media Corp LMCA.O.

U.S. regulators require large investors to disclose their stock holdings every quarter, and the disclosures can offer a window to their strategies for buying and selling stocks.

Berkshire ended June with more than $119 billion of equities, about 90 percent of which are on U.S. exchanges. It also owns more than 80 businesses ranging from ice cream to insurance to railroads.

Reporting by Luciana Lopez and Jonathan Stempel; Additional reporting by Bangalore newsroom; Editing by Dan Grebler and Ken Wills

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