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Warren Buffett is not close to beating the market this year, and a giant pension fund has cut its investment in
Berkshire Hathaway
investment juggernaut like buffett helms.
B shares in Berkshire Hathaway stock (ticker:
BRKb
) has only clearly a 0.9% gain so far in 2019 through Friday's close, in stark contrast to the S & P 500's 18.7% increase.
We've discovered that Buffett suffered "a reputation and financially black eye" earlier this year, when Berkshire made a $ 1 billion loss when
Power Heinz
Stock (KHZ) – one of its major investments – tumbled. Years ago, Buffett supported the combination of H.J. Heinz and Kraft Foods Group who create the company.
Oven's pension fund in Oregon happened two-fifths of its Berkshire stock investment by selling 141,822 B shares in the second quarter. OPERF, as the pension is known, did the information in a form it filed this week with the Securities and Exchange Commission. OPERF, recently considered the 42nd largest public pension in the world of assets, now owns 222,763 B shares in Berkshire.
Selling the Berkshire share in the second quarter appears to have been a strong step as the shares have declined 3.3% so far in the third quarter. We have discovered that Buffett himself has trimmed his position in Berkshire through his gift.
Read more: The man who pulled Warren Buffett in the dust
The pension also provided other major changes in some of its largest equity investments. OPERF slashed positions in
General Electric
(GE) and
Verizon Communications
stock (VZ) and more than doubled investment in
Broadcom
(AVGO) and
Oracle
(ORCL). OPERF refused to comment on its second quarter equity markets.
The pension noted in a newsletter that it surpassed most mates in 2018, and ended the calendar year with a half-percentage gain while others reported losses. But every rose has its thorn, it is said. At the end of the 2017 calendar, the latest actuarial valuation date, Orean's pension system, was only 73% funded against debt, but at least increased from 69% at the end of 2016.
On June 30, OPERF owned $ 7.4 billion. US listed securities, about 10% of the total assets of $ 74.6 billion under management at the end of May, are the latest monthly allotment data available.
OPERF cut nearly two-thirds of the GE stock investment by selling 1.4 million shares in the second quarter, ending June with 924,965 shares. The GE share has had a surprisingly strong 2019, rising 38.0% year to date. However, since the end of the second quarter, the shares have risen by about 4.4%. Nevertheless, we noted that at least one analyst expects conglomerate shares to continue climbing to $ 16 or more next year. GE stock closed at $ 10.04 on Friday.
The Verizon share has gone 1.0 percent since the end of June, and has so far had a gain of just 0.7 percent. OPERF minced its investment in the telecom giant in half of 439,398 Verizon shares. Earlier this month, we discovered that an analyst downgraded Verizon to Neutral from Buy. Citigroup's Michael Rollins noted that "the potential for further expansion has diminished."
OPERF more than doubled its investment in chip giant Broadcom to 103,325 shares by buying 61,511 additional shares in the second quarter. Broadcom share sports have a 14.0% annual profit, but have increased by 0.7% since the end of the second quarter. We had proposed a Broadcom option strategy earlier this month that could pay off if the US and China can reach a trade pact.
Strong earnings have raised the Oracle share this year. The software firm's share is up 27.4% so far in 2019, including a 1.0% gain since the end of June. OPERF doubled its investment in the Oracle share in the second quarter and ended June with 544,253 shares.
Inside Scoop is a common Barron feature that covers share transactions by business executives and board members – so-called insiders – as well as major shareholders, politicians and other prominent figures. Due to their insider status, these investors are required to provide shares with the Securities and Exchange Commission or other regulatory groups. [19659000] Write to Ed Lin at edward.lin@barrons.com and follow @BarronsEdLin .
