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Warren Buffett is known for the stocks he buys. He's had some big winners through the years. And many of them have helped propel Berkshire Hathaway to deliver a compound annual growth rate of nearly 20% over the past six decades.
More recently, though, Buffett has sold more stocks than he's bought. Over the past six months, the legendary investor has completely exited or reduced Berkshire's positions in at least 12 stocks.
Selling away
Buffett sold all of Berkshire's positions in three stocks in the fourth quarter of 2024. Technically, two of them were exchange-traded funds (ETFs) that trade like stocks -- SPDR S&P 500 ETF Trust(NYSEMKT: SPY) and Vanguard S&P 500 ETF(NYSEMKT: VOO). The other was Ulta Beauty(NASDAQ: ULTA).
Several bank stocks were on the chopping block as well, although Berkshire still owns some shares of each. Buffett reduced his company's stakes in U.S.-based Bank of America(NYSE: BAC), Capital One Financial(NYSE: COF), and Citigroup(NYSE: C) in Q4. He also slashed Berkshire's position in Latin American digital banking leader Nu Holdings(NYSE: NU) by 53.5%.
Telecommunications and media stocks were in Buffett's crosshairs too. He sold shares of Charter Communications(NASDAQ: CHTR) and T-Mobile US(NASDAQ: TMUS). Buffett reduced Berkshire's position in Formula One Group(NASDAQ: FWON.K). Although it isn't a telecom or media stock, Formula One is owned by Liberty Media, which is.
Berkshire also trimmed Berkshire's stake in building materials manufacturer Louisiana Pacific(NYSE: LPX) by around 5% in Q4. We don't know all the stocks he might have sold in the first quarter of 2025 yet. However, one is definitely on the list: DaVita(NYSE: DVA). A regulatory filing revealed multiple sales of the dialysis services provider's shares in February 2025.
Behind Buffett's moves
Why did the "Oracle of Omaha" make these moves over the past six months? Like the oracles of ancient times, Buffett can be cryptic and not overly forthcoming in explaining his decisions. He rarely discusses the reasoning for selling stocks. However, we can make some educated guesses.
I suspect the full exit of positions in the SPDR S&P 500 ETF Trust and Vanguard S&P 500 ETF was probably merely housecleaning. Berkshire only had small positions in the two S&P 500 index funds.
Buffett has become much less enamored with bank stocks than he was in the past. This change in perspective likely explains why he sold shares of Bank of America, Capital One, Citigroup, and Nu.
DaVita's legal troubles might be at least part of the reason why Buffett sold part of Berkshire's stake in the company in the first quarter of 2025. Buffett sets a high bar for the management teams of the companies in which he invests. DaVita settled allegations of illegal kickbacks in July 2024.
What about Ulta Beauty, Charter, T-Mobile, Formula One Group, and Louisiana Pacific? Maybe Buffett isn't as confident in their business prospects as he once was. Ulta, in particular, has struggled recently, with the company's beauty product lineup losing market share in 2025 for the first time in the company's history.
Should you sell these stocks too?
You should not sell these stocks solely because Buffett did. However, if any of them are in your portfolio, I think there are three good reasons for potentially selling.
First, if you need to raise cash, selling stocks could be the right move. That doesn't automatically mean that any of the stocks Buffett recently sold are your best candidates to sell, though.
Second, if your initial premise for buying the stocks has changed significantly, selling makes sense. As we've discussed, this could be the reason behind Buffett's decision to sell some of these stocks.
Third, if any of these stocks have become too great a part of your overall portfolio, reducing your position could be prudent. This is especially applicable if you're concerned the stock doesn't have as much room to run going forward.
On the other hand, some investors could find the stocks Buffett sold as attractive picks to buy. In my opinion, Nu could fit the bill for growth investors. The company still has excellent opportunities in the Latin American markets it serves. Its stock is also valued reasonably in light of those prospects, with a forward earnings multiple of 20.
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Bank of America is an advertising partner of Motley Fool Money. Citigroup is an advertising partner of Motley Fool Money. Keith Speights has positions in Berkshire Hathaway. The Motley Fool has positions in and recommends Bank of America, Berkshire Hathaway, Ulta Beauty, and Vanguard S&P 500 ETF. The Motley Fool recommends Nu Holdings and T-Mobile US. The Motley Fool has a disclosure policy.
