Selling 17.86 million BYD and continuing to buy Western oil. Why does Buffett prefers energy stocks?

Time is an important criterion for inspection and investment.

After a lapse of more than 5 years, Buffett has the goal of heavy warehouses, although the timing of every decision is not very "appropriate" in the outside world. In the second half of 2021, Buffett began to buy energy stocks, and then had been added. Regardless of oil prices, Berkshire kept buying repeatedly.

On August 19, Buffett's Berkshire was approved by the Federal Energy Management Commission and could buy up to 50%of the stocks of Western Petroleum Corporation.

Affected by this news, Western oil rose nearly 10%that day, and the market value was approaching the highest point.

It is worth noting that as of August 8, Berkshire's shares holding Western oil have exceeded 20%, reaching the standard of parallel.

In fact, I think that as a Buffett, investment in Western oil may not be a financial level, but to eventually acquire it.

At present, the market value of Western oil is close to $ 64 billion. If Buffett has continued to increase its holdings, it will not rule out that its market value will exceed $ 100 billion in the future. Therefore, the problem that is now placed in front of investors is to buy Western oil with Buffett?

In my opinion, it is not easy to follow Buffett for ordinary investors, because in the transaction of buying Western oil, international oil prices and the net profit of Western oil have always been a factor that cannot be ignored. Judging from Buffett's behavior, it seems that he firmly bet on the rise of international oil prices in the future.

Recently, Berkshire announced the second quarter performance report. The net loss attributable to shareholders in the second quarter was as high as US $ 43.755 billion. The main reason for the loss was the net loss of investment and derivatives of US $ 5.3.038 billion. Judging from the largest holding stocks, Apple loses 21%in the second quarter. Although the energy stocks have increased well, they cannot completely overcome the decline of heavy warehouse stocks.

Judging from the financial report of Berkshire in the second quarter, Buffett still did not fear the decline of individual stocks, and added warehouses for Western oil, Blizzard, Apple, and Chevron. According to Berkshire's current cash holdings, the future Continue to add position oil stocks may be a high probability event. In addition, at the Berkshire Shareholders Conference this year, Buffett revealed the idea of ​​continuing to buy Apple, and bluntly abandoned the purchase of Apple stocks because of the rise in its stock price, but in the second quarter of this year This also gave Berkshire's opportunity, so Buffett decisively chose to increase the position in the second quarter.

For Apple, Buffett's current logic has been very clear, and it is the largest position in Berkshire. As the largest stock of Berkshire, the Apple family has already occupied nearly half of its position. In addition, Apple's stock price has fallen since the second quarter of the third quarter of this year. In the third quarter, the increase in the third quarter reached 14%, and all the declines were recovered at the highest. Investment will return significantly.

Buffett once said that his investment would not look at the changes in the first quarter or a year of investment targets, so Buffett seemed very persistent in buying Western oil this year.

I think there are few big mistakes in Buffett's investment career. Although new energy is very popular at the moment, Buffett still firmly bought traditional energy companies, not that Buffett is not very optimistic about new energy, but that new energy is still not stable enough.

Judging from the target of Buffett's investment in the past, the companies he bought were undoubtedly relatively stable and excellent in management. The company's cash flow was extremely good and the business model was relatively mature. Therefore, from this dimension, it may be a high probability event to buy Western oil in the future. The last big acquisition.

In my opinion, from the current attitude of Buffett to Western oil, in the next year or two, Berkshire's speed of buying Western oil will be further accelerated until it is fully acquired. But it is worth noting that Buffett has recently sold BYD, which is a more clear signal for the entire new energy sector.

According to Berkshire's shareholding records, the company's holding of BYD's shareholding has decreased from 219 million shares on August 24 to 207 million shares on September 1st, with a cumulative reduction of 11.579 million shares in the past week, accounting The percentage of the issued voting rights shares dropped from 19.92%to 18.87%. Combined with the 6.2.81 million shares disclosed recently, Buffett has reduced its holdings of 17.86 million shares in the past two months.

Regarding Berkshire's reduction, BYD responded that without excessive interpretation, the company's operation was normal. However, I think that in the future, Buffett's continued reduction of BYD will be a high probability event, and it will not even rule out the possibility of clearing the position.

At present, Buffett has been holding BYD for 14 years. During the period, even more than ten times the income has not undergone shares. Now the probability of reducing holdings is also seen that the fundamentals of the long line have changed or valuation have been significantly deviated from the internal value. Essence

In summary, Buffett's buying Western oil reduction BYD represents his view of future energy. This is of great reference for the entire market.

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