CIT Group Inc. (CIT), MBIA Inc. (MBI): Fairholme & Bruce Berkowitz’s Bearish Moves; Should You Follow?

Berkowitz did increase his stakes in Bank of America Corp (NYSE:BAC) and American International Group Inc (NYSE:AIG), so perhaps he currently perceives more value in these other financial companies.

During the quarter, Berkowitz also made a minor adjustment to his most controversial holding. He sold 83,700 shares of his approximate 25 million-share stake in the Florida-based commercial and industrial development company The St. Joe Company (NYSE:JOE), with this holding still worth about $532 million as of March 31.

Berkowitz has had a lengthy and troubled history with the investment, and has been intensely involved with boardroom politics of St. Joe via a position on the company’s board of directors. Although St. Joe reported a decline in earnings last quarter, some analysts, and perhaps Berkowitz himself, consider its balance sheet to be solid, and thus, a long-term value play.

Final thoughts

Berkowitz is a large and influential investor, with a bias towards value-oriented plays, so his buys and sells are always worth noting for those who use that investment style. In particular, the closing out of his fund’s entire position in CIT Group Inc. (NYSE:CIT) should give some investors in this company pause for thought, given that there are other attractive propositions in this sector. Additionally, Berkowitz’s cuts in MBIA Inc. (NYSE:MBI), Wells Fargo & Co (NYSE:WFC) and The St. Joe Company (NYSE:JOE) are intriguing, with the latter being the one we’d watch the closest moving forward. Continue preparing for 13F-filing season here.

Disclosure: none