His total haul comes to $2 billion, received from gains on warrants he obtained through a big bet during the 2008 financial crisis.
Interestingly, Buffett's taking the cheap way out, preferring to take a smaller stake in the giant investment bank.
Why Buffett isn't so bullish on Goldman In March, Buffett had a choice: He could simply execute his warrants and purchase shares at a price below their current market value, or he could choose to take his profits on the warrants in the form of stock.
Buffett chose to take the profit in the form of stock, showcasing that he doesn't plan to add any new capital to the position. He just wants his profits.
What does this say?
Well, for starters, Buffett may not believe Goldman Sachs to be a bargain at today's price. If he had thought so, he would have preferred to buy more shares at a below-market cost and get an immediate stake in the leading investment bank with no transaction costs.
You have to remember that it isn't easy for Buffett to scale into new positions. It took him months to acquire a large stake in one of the most liquid companies on the market, International Business Machines Corp. (NYSE:IBM). Obviously he would like to take a fee-free, easy transaction when he can get it in a business he likes at the right price.
For Goldman Sachs, a price less than 1.2 times tangible book value must not be the right price.