Warren Buffett has unveiled the mystery stock in Berkshire Hathaway's portfolio: Chubb.
Berkshire Hathaway first acquired shares in the insurance giant during the third quarter of 2023, obtaining regulatory permission to keep the holding confidential until it completed its stake-building process.
Initially, Buffett's company purchased 8.1 million Chubb shares valued at $1.7 billion by the end of September. By December, the position had grown to 20.1 million shares, worth $4.5 billion. As of the end of March, Berkshire had increased its stake to 25.9 million shares, valued at $6.7 billion, according to SEC filings released on Wednesday.
Assuming there have been no further changes, Berkshire now owns approximately 6.4% of Chubb, a company with a market capitalization of about $100 billion.
Chubb operates in 54 countries, offering a diverse range of insurance products, including property and casualty, health, reinsurance, and life insurance. This investment aligns well with Buffett's comfort zone, given Berkshire's substantial presence in the insurance sector through subsidiaries like Geico and Alleghany.
In a notable move, Buffett and his team reduced their largest holding, Apple, by 13%, bringing their stake down to 789 million shares last quarter. This reduction contributed to a $39 billion decline in the value of the position, which stood at $135 billion at the close of March.
The Apple sales were anticipated by those closely following Buffett, as they were hinted at in Berkshire's recent annual report. These sales constituted nearly all of Berkshire's $20 billion in stock sales during the period.
Berkshire investors are likely to appreciate the revelation of the Chubb stake, as Buffett has faced challenges in finding attractive acquisition targets in recent years. This difficulty stems from the stock market's record highs and intense competition from private equity firms.
As a result, Berkshire's cash and Treasury bill reserves have swelled to a record $189 billion by the end of March. Buffett projected during Berkshire's recent annual meeting that this figure would exceed $200 billion by the end of June.
