Today I am going to look at what happened in the latest 13F filings of the world’s largest investors. This time, we did not just see small adjustments. We saw a clash of views.
Warren Buffett reduced his position in Amazon.
At the same time, Bill Ackman and Seth Klarman were buying aggressively.
Now the question is not simply who bought and who sold.
The real question is who is seeing the next five to ten years correctly.
WHAT 13F FILINGS ARE AND WHY THEY MATTER
13F filings are quarterly reports that large investment funds submit, showing which stocks they hold at the end of each quarter. They are essentially a snapshot of their portfolios. They do not show when during the quarter the purchases were made. They do not show whether positions were already sold after publication. They do not include bonds, private investments, or derivatives. So they are not the full picture.
Still, they are an extremely useful tool. They reveal the thinking patterns of top capital allocators. That alone makes them worth our attention.
BERKSHIRE HATHAWAY
We begin with Berkshire Hathaway. Its roughly 274 billion dollar portfolio remains highly concentrated. The five largest holdings account for nearly 70 percent of the total. Apple, American Express, Bank of America, Coca-Cola, and Chevron dominate.
This concentration has always been characteristic of Buffett. When he finds something exceptional, he keeps it large.
However, in recent months we have seen something different.
Berkshire has been a net seller of stocks for thirteen consecutive quarters. Its cash position has swollen significantly. The cash pile has reached historic highs.
That alone tells a story. When Buffett does not find enough attractive opportunities, he prefers to sit on liquidity rather than feel pressured to buy.
Within this environment, we saw another reduction in Apple, another reduction in Bank of America, and a reduction in Amazon.
Apple once represented more than half of Berkshire’s portfolio. Today, that percentage has declined substantially. This does not mean he no longer believes in the company, but it does show active risk and valuation management.
At the same time, we saw a new position initiated in The New York Times Company. One could argue that this contradicts Buffett’s earlier comments about newspapers and the structural decline of the industry. However, he has clarified that a few brands have successfully transitioned to a digital model while maintaining a strong subscription base. Perhaps he sees something similar here.
The bigger question, though, is different. How Buffett like are these moves?
We are in the middle of a historic transition. Greg Abel is gradually taking over leadership, while Todd Combs and Ted Weschler play significant roles in managing the portfolio.
So are all these moves purely Buffett’s decisions? Or are we already seeing the imprint of the next generation?
We cannot know for certain. What we do know is that the overall posture looks more defensive, with less aggressive exposure to technology compared with previous years.
THE PLOT TWIST
At the very moment Berkshire was trimming Amazon, Seth Klarman of Baupost made Amazon the second largest position in his portfolio. He bought more than two million shares and raised it to over 9 percent of his invested capital.
Klarman is a classic value investor, so why invest in Amazon?
Because he sees something beyond simple ecommerce. Amazon Web Services is the real profit engine. It generates the majority of the company’s operating income, even though it represents a smaller share of total revenue.
With the acceleration of artificial intelligence, cloud services are becoming even more critical and growth rates are strengthening. At the same time, margins are higher and operating leverage increases.
From a valuation perspective, Amazon is trading at lower forward multiples compared with its five year average. For a value investor, that can be attractive.
And it is not just Klarman.
Bill Ackman of Pershing Square Capital Management made one of the most aggressive rotations of recent years. He built a significant position in Amazon. He moved aggressively into Meta Platforms. He significantly increased his stake in Brookfield Corporation. And to finance these moves, he drastically reduced his position in Alphabet.
