Warren Buffett’s Berkshire Hathaway has been steadily increasing its stake in Occidental Petroleum over the past nine trading sessions. This influx of shares has propelled Buffett’s ownership in the Houston-based oil and gas producer to nearly 29%, indicating a strong vote of confidence in the company’s future prospects.
Through daily purchases from June 5 to the present day, Berkshire Hathaway acquired an additional 7.3 million shares of Occidental Petroleum. The purchase prices fluctuated slightly above or below $60 per share, as revealed in regulatory filings. With these recent transactions, Berkshire now holds over 255 million shares, representing a significant 28.8% stake in the company.
Occidental Petroleum stands as Berkshire’s sixth-largest stock holding, underlining the importance of this particular investment in Buffett’s portfolio. Additionally, Berkshire has emerged as the largest institutional investor in Occidental, reinforcing the level of confidence Buffett has in the company’s leadership and operations.
Furthermore, Berkshire’s ownership extends beyond common shares, with holdings in Occidental preferred stock amounting to $10 billion. The company also possesses warrants to acquire an additional 83.9 million common shares at a fixed price. If fully redeemed, these holdings could potentially push Berkshire’s ownership of Occidental above 40%, demonstrating the substantial position Buffett has amassed in the company.
Despite the significant influence Berkshire holds in Occidental Petroleum, Buffett has clarified that he does not intend to take full control of the company. This declaration dispels any rumors of a potential takeover, especially after Berkshire received regulatory approval for a 50% stake. Buffett’s decision to invest in Occidental was based on a thorough analysis of the company’s performance and strategy, highlighting his confidence in Occidental’s CEO, Vicki Hollub, and her leadership style.
Occidental Petroleum, with a dividend yield of 1.5%, has seen relatively stable stock performance this year, following a slight dip in 2023. Buffett’s investment strategy, which capitalizes on market volatility, allowed Berkshire to acquire a significant portion of Occidental in a short period. This tactical approach underscores Buffett’s ability to seize opportunities and make strategic investments in line with his long-term vision for Berkshire Hathaway.