Tickers in this Article: BRK.A, PIR, BAC, WFC, SASY, WLP, JNJ, HRB, NWS, DJ
Berkshire Hathaway (NYSE:BRK.A) has a reputation as a buy and hold investor. It's common to see the well-known, investment holding company own a stock in perpetuity.

However, it does make some changes in its portfolio and investment style each quarter. While none of these position changes are usually major, it pays to review them if for no other reason than to get a better sense of where its legendary chief executive officer, Warren Buffett, thinks there's money to be made.

With that in mind, let's dig in to the latest documents the firm has filed with the SEC, and see just what Berkshire's been buying and selling.

Dow Jones (NYSE:DJ)
SEC documents reveal that Berkshire bought roughly 2.8 million shares of the well-known publisher of the Wall Street Journal during the second quarter. But why? There's almost no way that even Buffett could have foreseen that a shrewd businessman like Rupert Murdoch was going to take over.

The investment is counterintuitive in some ways. Buffett has said the newspaper business faces serious challenges due to competition from other content sources including the internet. So why was Buffett buying?

My hunch is that he saw the stock as a bargain. After all, at the beginning of Q2 it was trading near its 52-week low. It also was expected to grow its bottom line at an impressive 22% over the next year, which is much better than many businesses out there.

In any case, he made some serious moola from Dow Jones.

My Take On Dow Jones:
I'm excited about the Newscorp (NYSE:NWS) deal, but with Dow Jones being taken over at $60 per share, I don't think its worth jumping in right here.

Now, you may be thinking, there's a quick 10% to be made if the company is able to close the deal by year's end. However, while that may be true, if for some reason the deal falls through, I suspect the stock would sink like the Titanic. So, in my mind, it just doesn't make sense to try to arbitrage trade the shares.

Wells Fargo (NYSE:WFC)
At the end of March, Berkshire owned roughly 232 million shares of Wells Fargo, and the position accounted for about 13.91% of Berkshire's total holdings. In the second quarter, the company added to its existing position, accumulating some 25.5 million shares.

I think Buffett was buying because Wells Fargo is a company with a long and storied operating history, and despite the current state of the domestic economy, it appears well positioned to reap the benefits once the economy rebounds, particularly because of its vast footprint of roughly 6,000 branches.

My Take On Wells Fargo:
When I penned my last article on Berkshire "Warren Buffett's Top 5 Holdings", I said I'd like to see the stock pullback before jumping in. Well, since that article was published the stock has only pulled back about a dollar, and frankly that's not enough insurance for me given the struggles that many financial institutions are experiencing. To qualify my statement - in the $25 to $30, I may revisit the idea.

Bank Of America (NYSE:BAC)
At the end of the quarter, Berkshire owned 8.7 million shares of the second-largest U.S. bank, and that the stake was valued at $425.3 million.

Why is Buffett buying? I suspect it's because Bank of America has its hands in everything from traditional banking to financial services, and credit cards. But even more importantly, because of the company's vast size, I think he sees some serious opportunities for cost savings. For example, just imagine how many middle managers it could eliminate, or how many facilities it could close and not materially impact its business - effectively boosting it's bottom line!

My Take On Bank Of America:
Long term, it looks like a great play. After all, it sports a dividend with a yield of about 5.3%, and it's expected to grow its earnings at a roughly 7.5% rate each year for the next five years, which is pretty decent for a company of such size.

However, in the near term, as I said in my take on Wells Fargo, I am bearish on the outlook for the financials. Therefore, I'd stay away from the stock, but might consider revisiting if the stock pulls back a bit.

Health Care Stocks
Berkshire upped its investments in French drug maker Sanofi-Aventis SA, Johnson & Johnson (NYSE:JNJ) and WellPoint (NYSE:WLP) the well-known health insurer.

Why is Buffett buying? I think it's because the healthcare industry in general should benefit over the long haul particularly as our nation ages. I also think that some investors have wrongly assumed that the Democrats were going to immediately overhaul the healthcare system once they took control of Congress. Frankly, I like all three of these investments, and I think that all three have excellent growth prospects.


The Sell Side

At the end of Q2 Buffett and Berkshire reported no holdings in either H&R Block (NYSE:HRB) or Pier 1 Imports (NYSE:PIR) which had, as of March, accounted for just 0.05% and 0.02% of the company's total holdings.

Why did Buffett sell? My guess is that he saw better opportunities out there and a better way to deploy that cash.

My Take On H&R Block and Pier 1
I think that over the long haul H&R Block will continue to fare well. After all, it has a solid name and a large footprint. In addition, as the tax code becomes more and more complicated, logic dictates that the company will reap the benefits.

On the flip side, I am a little bit worried at how Pier 1 will compete. There are plenty of other retailers out there who sell knickknacks and related home furnishings. However, in the near term, the company has begun to shutter unprofitable stores and many say that it is in the midst of a turnaround.

To learn more from the Oracle of Omaha, read What Is Warren Buffett's Investing Style?


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