Buffett Dumps Nearly Half of Bank of America Stake

Warren Buffett has dramatically reduced Berkshire Hathaway's stake in Bank of America, selling off nearly 465 million shares—a 45% cut—since mid-2024. This move comes even though Bank of America remains Berkshire's third-largest holding by market value, per the Motley Fool. The sales may be the result of profit-taking, as Berkshire's investment in the bank has produced significant unrealized gains. The shares are no longer a bargain, as Bank of America's stock is now trading at a 38% premium to its book value. When Buffett first invested in the bank's preferred stock in 2011, its common stock was valued at 68% less than book value.

Another factor may be the expectation that future rate cuts by the Federal Reserve will have an adverse impact on Bank of America's interest income. Bank of America is considered the most interest-rate-sensitive of America's money-center banks. The so-called Oracle of Omaha, who will step down as CEO of Berkshire Hathaway at the end of the year, has also been selling other stocks, with Buffett a net seller for 12 quarters in a row, totaling $184 billion. Meanwhile, Buffett has been buying shares of consumer-facing pizza brand Domino's for five straight quarters. Kiplinger has more stocks that Buffett is scooping up or selling.