Berkshire’s investment in tech giant International Business Machines Corp. (NYSE:IBM), its third biggest equity stake, has gone up to 6%. By the end of 2012, it owned 68 million shares of International Business Machines Corp. (NYSE:IBM), amounting to $13 billion. When Berkshire Hathaway Inc. (NYSE:BRK.B) invested in IBM, it also considered International Business Machines Corp. (NYSE:IBM)’s bullishness in stock buybacks as it proved to be a more efficient way of returning cash back to investors than dividend payouts. Apparently, the recent move to further increase its stake in IBM will not only quench its thirst to grow, but also boost its EPS results. It seems that Berkshire may add to this position if IBM found trading near around $190 a share.
What’s not to like?
Taking into consideration Berkshire Hathaway Inc. (NYSE:BRK.B)’s overall portfolio, capital allocation, and robust financial position, it is currently a buy. Another important signal for investors is the growth of Heinz in the emerging markets, where Berkshire is likely to expand further. Overall, Berkshire at the moment is truly a solid pick for any investor who is not just looking at it from dividend perspective but also capital appreciation over the years.
The article Berkshire Being Likable Despite Taking Huge Risks originally appeared on Fool.com and is written by Jeremiah Feliciano.
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