Berkshire buys Nestle, Exxon; ups Wal-Mart stake

Billionaire Warren Buffett's Berkshire Hathaway Inc on Monday revealed new investments in Nestle AG and Exxon Mobil Corp and that it has nearly doubled its investment in Wal-Mart Stores Inc .

In a U.S. Securities and Exchange Commission filing reporting U.S.-listed equity holdings as of September 30, Berkshire said it held 3.4 million American depositary receipts of Nestle, the world's largest foodmaker, worth $144.7 million.

It also reported owning 1.28 million shares of Exxon Mobil, the world's largest oil company, valued at $87.6 million.

Berkshire also boosted its stake in Wal-Mart, the world's largest retailer, 90 percent from three months earlier, to 37.8 million shares worth $1.86 billion from 19.9 million shares.

While the companies are all household names, their shares have lagged the broader U.S. stock market since the market bottomed in March. Buffett favors undervalued stocks, and regularly buys even when economic conditions are weak.

The general market has rocketed higher, but it may be that these businesses haven't participated as well, said Justin Fuller, an analyst at Midway Capital Research & Management in Chicago and author of the Buffettologist.com blog.

Berkshire also reported new investments of $96.3 million in trash hauler Republic Services Inc , and $1.35 million in insurer Travelers Cos .

Omaha, Nebraska-based Berkshire did not immediately return a request for comment.

Buffett, the world's second-richest person, does not publicly discuss what he is buying and selling, or ordinarily explain purchases and sales revealed in quarterly SEC filings.

Monday's SEC filing includes investments made by Berkshire subsidiaries, including a portfolio at the car insurer Geico Corp overseen by Lou Simpson. Buffett has said investors should not assume all the reported investment decisions are his.

A separate SEC filing revealed that Berkshire had begun amassing its Exxon stake by the second quarter. The SEC occasionally lets Buffett delay disclosing investment activity so investors cannot copy him while he is buying and selling.

Soros Asset Management, overseen by billionaire George Soros, in a separate SEC filing revealed a stake in Berkshire itself and increased stakes in many blue-chip companies.

WHITHER KRAFT

Fuller said the Nestle stake appears surprising given Berkshire's reported $3.63 billion stake in Kraft Foods Inc , which last week launched a hostile bid for Britain's Cadbury Plc .

Yet he said Nestle could help Berkshire diversify away from Kraft. It is the classic Berkshire-type business in that it is easy to understand, and which has many good brands that people like to buy.

He also said the added Wal-Mart stake makes more sense at a time consumers are more price-conscious, while the Exxon stake could be indicative of Berkshire's large bet in energy. If you believe as Buffett does that more inflation is on the horizon, then it makes sense.

Berkshire this month agreed to buy the 77.4 percent of railroad operator Burlington Northern Santa Fe Corp it did not already own for $26.4 billion.

While Berkshire on Sept 30 still owned shares of railroad operators Norfolk Southern Corp and Union Pacific Corp , Buffett has said he has sold these.

The value of Berkshire's disclosed portfolio of U.S.-listed equities grew 16 percent from the second quarter to $56.55 billion from $48.95 billion. Berkshire bought a net $1.45 billion of equities in the quarter.

Berkshire also reported increased stakes in Wells Fargo & Co and lowered stakes in oil company ConocoPhillips , credit rater Moody's Corp , NRG Energy Inc , SunTrust Banks Inc and health insurer WellPoint Inc .

It also reported no stake in Eaton Corp , after holding 2 million shares of the manufacturer of hydraulics and electrical control systems three months earlier.

Buffett has transformed Berkshire since 1965 into a roughly $160 billion conglomerate with close to 80 companies selling such things as candy, car insurance, ice cream and underwear.

In Monday trading, Berkshire Class A shares closed up $945 at $103,000, and its Class B shares rose $20.50 to $3,431.50.

(Editing by Andre Grenon and Steve Orlofsky)