Warren Buffett's Berkshire swaps 'banks' for 'booze' stks

As Warren Buffett, the legendary investor and CEO of Berkshire Hathaway, prepares to step down, there is a minor shift in his investment strategy. Recent filings in the US showed Berkshire Hathaway has more than doubled its stake in Constellation Brands, the maker of popular beverages like Corona, Modelo, and Robert Mondavi wines, while reducing holdings in major financial institutions such as Citigroup, Bank of America, and Capital One.

Buffett, 94, will remain as chairman of Berkshire Hathaway's board of directors once he steps down as chief executive at the end of this year. His retirement marks the end of a remarkable 60-year tenure during which he transformed Berkshire Hathaway from a struggling textile company into a $1.2 trillion conglomerate.

The increased investment in Constellation Brands, now totaling about 12 million shares worth $2.2 billion, indicates a shift towards consumer staples with enduring demand. This gives Berkshire a 6.6% slice of the drinks company.

On the other hand, the reduction in holdings in financial stock reflects a cautious approach amid changing economic conditions and regulatory landscapes.

Buffett has always been known for his taste for cash-generating businesses with durable brands. And while the banking sector wrestles with interest rate uncertainty and fintech disruptions, the alcohol industry is having a party.

This investment is not completely an off the guard move. Berkshire still holds its largest position in Apple, worth $66.6 billion, and continues to invest in Japanese trading houses.

In the January-March period, Berkshire was a net seller of stocks for the 10th straight quarter, unloading $4.68 billion in shares while buying just $3.18 billion. Yet, with $347.7 billion in cash on hand, Buffett downplayed concerns about the cash, saying good investments do not pop up in an orderly fashion.

As Buffett prepares to retire, his investment decisions continue to influence markets and investors worldwide. The transition to Greg Abel is seen as a move to ensure continuity in Berkshire's investment philosophy, focusing on long-term value and prudent capital allocation.

Buffett is often called the "Oracle of Omaha" for his foresight when buying into undervalued stocks. One of his most famous investment quotes is be fearful when others are greedy and greedy when others are fearful.

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