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James Li
James Li
Articles (1492)  | Author's Website |

Warren Buffett's Berkshire Dials Back Liberty Global Stake

Berkshire real-time pick highlight

September 11, 2020 | About:

Berkshire Hathaway Inc. (NYSE:BRK.A)(NYSE:BRK.B), the $520-billion insurance conglomerate headed by Warren Buffett (Trades, Portfolio), announced this week that it reduced its holding in Liberty Global PLC (NASDAQ:LBTYA) according to GuruFocus Real-Time Picks, a Premium feature.

The insurance conglomerate sold 1.3 million shares of the UK-based cable company on Sept. 4, reducing the position 6.73%. Shares traded around $22.31 at the time. Berkshire has an estimated loss of 33.13% on the stock since initially buying shares during the fourth quarter of 2013.

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Company background

Liberty Global operates cable networks in a wide range of European markets, including the UK, Switzerland, Belgium, the Netherlands, Ireland, Poland and Slovakia. The company serves over 9 million Internet access customers across its consolidated footprint.

GuruFocus ranks Liberty Global's financial strength 4 out of 10: Although the company has a high Piotroski F-score of 7, Liberty Global has a weak Altman Z-score of 0.85 and a debt-to-equity ratio that underperforms 76.32% of global competitors.

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Liberty Global's profitability ranks 5 out of 10 as three-year revenue and earnings growth rates that underperform over 60% of global competitors offset strong net profit margins and returns on equity.

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See also

Buffett trimmed his conglomerate's holding in Wells Fargo & Co. (NYSE:WFC) and increased Berkshire's stake in Bank of America Corp. (NYSE:BAC) over the past few weeks, according to the list of GuruFocus Real-Time Picks. The guru also announced on Aug. 31 that his conglomerate took stakes in five Japanese conglomerates.

Disclosure: No positions.

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About the author:

James Li
I am an editorial researcher at GuruFocus. I have a Master's in Finance from SMU, and I enjoy writing reports on financial trends and investor portfolios. Follow me on Twitter at @JamesLiGuru!

Visit James Li's Website


Rating: 4.0/5 (2 votes)

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Comments

Praveen Chawla
Praveen Chawla premium member - 5 months ago

A trim of 6% or so in the position size is very small. Let us see if this continues in the future. Liberty is generating a lot of cash.

The company has over 7 billion of cash on its balance sheet. It's funny that according to your Altman score it may go bankrupt in short order. Maybe that metric needs to be retired or re-designed for this type of business.

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