Warren Buffett Reveals Berkshire’s Monster $904M Stake in Amazon
Warren Buffett and Berkshire Hathaway broke the news recently that the company was investing in Amazon, but no one knew how much of a stake was placed on the world’s largest e-commerce giant.
It was finally revealed that at the end of the first quarter 2019 (March 31), Berkshire Hathaway’s stake was 483,300 shares, according to a Securities and Exchange Commission filing. Those shares were valued at $904 million by the closing bell Wednesday.
What may be even more shocking though, is that those numbers don’t even touch to the top of the Amazon’s biggest shareholder list, and that value only represents about 0.1% of Amazon’s equity according to CNBC. Amazon’s market cap is currently a whopping $920.61 billion.
So what has this done for Amazon stock? Before the news broke on Wednesday shares had already gone up 1.69%, and they continued to rise another 0.7% in premarket trading to $1885.00 right before the opening bell Thursday. By 10 a.m., the shares were up 1.95% to 1,907.76.
There was a similar effect in the market when Buffett first revealed that Berkshire Hathaway had invested in the tech giant back on May 2. Shares shot up 3% after the news broke before tanking the following Monday after renewed trade fears between the U.S. and China.
Buffett has typically shied away from tech investments after running into a few bad deals over the years, and the move to put money into a booming stock like Amazon came on the recommendation of one of his colleagues in the Berkshire Hathaway office, according to an interview with CNBC on May 2.
“One of the fellows in the office that manage money … bought some Amazon, so it will show up in the 13F,” Buffett said on May 2. Buffett was likely referring to one of his two lieutenants, Todd Combs or Ted Weschler, who each manage portfolios of more than $13 billion in equities for Berkshire.
“Yeah, I’ve been a fan, and I’ve been an idiot for not buying” Amazon shares, Buffett said at the time. “But I want you to know it’s no personality changes taking place.”