US Bancorp: A $1.7B Loss for Berkshire Hathaway?

US Bancorp (USB) has been one of Warren Buffett’s favorite stocks. However, in the fourth quarter of 2008 he reduced Berkshire Hathaway’s (BRK.A) holdings by 5,385,700 shares or 7.38%. It was one of the few stock positions he reduced during the fourth quarter. Prior to those sales he owned 72,937,126 common shares of USB and that represented 4.1% of USB shares outstanding.

The price of USB shares on September 30, 2008 was $36.02 and the value of BRK’s holdings was $2,627,194,000. By December 31, 2008 USB had fallen to $25.01, a decline of 30.57%. The total value of the USB shares not sold during the quarter therefore declined by $743,741,200.

If Buffett still has the same position in USB as he had at the end of 2008, he has watched his investment drop by an additional 57.7% as of February 20th when the stock closed at $10.58. That 51 day decline alone would equate to $974,767,977.

It is possible that Buffett has experienced a decline of approximately $1.7 billion or 70.6% in the value of BRK’s holdings in US Bancorp. It should come as no surprise that Berkshire Hathaway’s shares have been under downward pressure.

Comments

[Teak:]

Methinks that the traders have been going from one bubble to another with everybody and his brother (her sister?) jumping together from one asset class to another. Dot.com to housing to commodities to Treasuries and then to ....? Apparently, the new hot asset class is the SHORT class. Eventually, that will blow up (blow down?) and then where do they jump?

Until/unless USB shuts down their many branches and lose their many depositors, I suppose that it is worth holding for a while longer. Maybe the traders will eventually come around to financials once again. Maybe plaid pants will come back in style also. We'll see.

Feb 23 03:18 AM

[NelsonsToy:]

It's more stable than most of the other CRAP out there!
Stick to what will be here when the"CRAPSHOOTERS"
are bankrupt!!.........86 year old Sceptic

Feb 23 10:33 AM

[Skip Olinger:]

Is this an analysis of USB or BRK? I don't get the point of this post. Whatever your point, it is certainly not a well reasoned, in-depth analysis that is useful.

Feb 23 11:03 AM