Warren Buffett Bets Big On Pharma After Pulling Back From Apple, Banks

Warren Buffett’s multinational conglomerate Berkshire Hathaway shed about $4 billion worth of Apple shares and has bet big on major pharma companies, according to the company's latest filing.

In an update filed with the SEC on Monday, the company revealed that it sold 36 million shares of Apple, bringing its stake down to about 3.7%.

Buffett’s company also made major changes in its portfolio, buying massive amounts of shares in drug companies, including 21.3 million shares in AbbVie (1.2% stake), 22.4 million shares in Merck (0.9% stake), 3.7 million shares in Pfizer (less than 0.1% stake) and a substantial number of shares in Bristol Myers Squibb (1.3%). The Pfizer investment is worth $140 million, while the other three are roughly worth $2 billion each.

Wall Street will look at the new pharma investments by Buffett’s company closely. Pfizer's recent announcement that its vaccine against the coronavirus showed more than 90% efficacy rate in its trials had sent the company’s stocks soaring. Similarly, Merck is in the middle of testing its own vaccine.

It is not clear which of these investment decisions were made by Buffett. He handles the biggest investments by the company, including Coca-Cola, Apple and Bank of America, according to a report.

The company pulled out from major bank stocks, including JPMorgan, where Berkshire reduced its holding by 96%. The company also trimmed its holding in PNC Financial by 64%. It also cut stakes in Wells Fargo from 10% to roughly 3.1%, and in M&T Bank.

The conglomerate added to its stake in Bank of America, General Motors and Kroger. Berkshire’s second-largest investment is in BoA, which is now at $28 billion after this investment.

This comes after the company had cut back on other U.S. banks, including its complete exit from Goldman Sachs, as the sector struggled due to low interest rates among other factors.

Other new investments in this quarter included a stake worth $6 billion in five Japanese trading houses and a $1.5 billion investment in data storage company Snowflake.