Warren Buffett-Led Conglomerate Berkshire Hathaway Cuts Stake in HP to 5.2%

By Jace Dela Cruz

Dec 12 2023, 00:04 AM EST

The Warren Buffett-led conglomerate Berkshire Hathaway has cut its stake in HP to 5.2%, according to a regulatory filing released on Monday.

Warren Buffett-Led Conglomerate Berkshire Hathaway Cuts Stake in HP

According to CNBC, Berkshire Hathaway previously had a nine-day selling streak in mid-September through early October, slashing down its bet on the printer and PC maker to around 10%.

This move comes as HP recently revealed its first-quarter profit guidance that fell below Wall Street estimates. However, the firm maintained its full-year earnings outlook, suggesting a potential recovery in the personal computers market.

Following this development, HP shares experienced a more than 1% decline in after-hours trading on Monday. Despite the reduction, Berkshire Hathaway still retains ownership of 51.5 million shares of HP, valued at approximately $1.6 billion based on Monday's closing price of $30.37.

The investment giant remains the third-largest institutional shareholder of HP, trailing behind BlackRock and Vanguard, as per FactSet.

Entry Into the Tech Hardware of Berkshire Hathaway

Berkshire Hathaway first bought the tech hardware stock in April 2022, but the investment has not generated substantial returns, as HP's stock remains below the acquisition level.

According to CNBC, despite a 13% increase in HP shares this year, it still lags behind the Nasdaq Composite, which has rallied almost 38%.

Given Warren Buffett's historical investment approach, some market analysts expected a possible complete divestment of stake. Buffett, who sees stock holdings as parts of businesses, usually opts for a complete exit rather than partial adjustments.

In related news, the 93-year-old investment icon recently donated over $870 million in Berkshire Hathaway stock to four family foundations. He donated 1.5 million Class B shares of Berkshire Hathaway to the Susan Thompson Buffett Foundation, named after his first wife.

Buffett also gifted 300,000 Class B shares to each of the foundations managed by his children: the Sherwood Foundation, the Howard G. Buffett Foundation, and the NoVo Foundation.