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Market Update

Berkshire's Latest Buys

Berkshire's buys More Wells Fargo and Wal-Mart; new money purchases include General Motors and Viacom.

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A quick glance at  Berkshire Hathaway's (BRK.A) (BRK.B) 13-F filing for the first quarter of 2012 revealed more than a handful of moves by the insurer during the quarter. The first transaction of note was Berkshire's purchase of another 10.6 million shares of  Wells Fargo (WFC), which brings the firm's stake in the bank up to 394.3 million shares (worth $13.5 billion at the end of the first quarter). Wells Fargo has been Warren Buffett's "go to" stock over the last three years, and while we didn't think that the shares had dipped enough during the first quarter to warrant a whole lot of buying activity, the Oracle of Omaha felt differently. Since the start of 2009, Berkshire has added 104.1 million shares of Wells Fargo (equivalent to 36% of its holdings in the bank at the end of 2008) to its investment portfolio.

Buffett was also going back into the market to pick up shares of  Wal-Mart (WMT), and that was even before news broke last month that the firm's largest foreign subsidiary, Wal-Mart de Mexico, had been accused of years of widespread bribery in that country. We had recently speculated that Wal-Mart was one of only a few names we could envision Buffett buying (following his comments early last week that he had purchased two stocks for Berkshire's account in the days before and after the annual meeting, indicating that these were additions to positions the company already owns), so we weren't too far off the mark. The question, though, is whether Buffett was adding to the 7.7 million shares that Berkshire already picked up during the first quarter when the stock took a turn for the worse at the end of April. With the retail giant accounting for less than 4% of Berkshire's total stock holdings at the end of the first quarter, we wouldn't be surprised if Buffett did step up and purchase more shares of Wal-Mart during the current quarter.

Greggory Warren does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

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