Teva Pharmaceuticals (TEVA) stock jumped by 11% after 13F filings revealed that Berkshire Hathaway, the corporate conglomerate led by billionaire investor Warren Buffett, took a $358 million stake in the pharmaceutical company. (See more: Berkshire Hathaway Adds Apple and Teva Shares, Dumps IBM.)
By now, many of the figures in the 13F reports may be out of date, and this is one reason why everyday investors are cautioned against making investment decisions based on 13F filings. That's not to say, however, that the release of 13F information to the public does not have an immediate impact.
As you can see in the chart below, Teva stock skyrocketed after news of the Berkshire Hathaway investment.
Although 13F filings relay news about the holdings of some of the biggest financial firms in the world, they come a month and a half late. February 15th was the deadline for 13F filings from hedge funds and other firms managing at least $100 million in assets under management.
These reports document the positions those firms held as of December 31, 2017. (See also: Billionaire Ray Dalio's Bridgewater Bets Big on ETFs.)
Berkshire Held 18.9 Million Teva ADRs
Buffett's 13F filing for the fourth quarter of 2017 indicated that Berkshire Hathaway held 18.9 million ADRs of Teva, a stake valued at about $358 million. When the 13F information became public on Wednesday, shares of Teva experienced an immediate uptick in value in trading. After climbing by 11%, the price of Teva shares leveled off somewhat, although it was still up more than 6% for after-hours trading, according to CNBC.
It's unclear if Berkshire Hathaway still holds a position in Teva right now. The 13F report indicates only that Berkshire had $358 million in Teva as of December 31, 2017. Nonetheless, the news that Buffett was at one point fairly heavily invested in the pharmaceutical company was enough of an indication to the broader investment world that the stock was worth buying that its value shot up in just a few hours.
Jana Partners Also Added Teva
Berkshire Hathaway was not the only financial firm to buy into Teva stock in the fourth quarter of 2017. Jana Partners, the investment firm of hedge fund billionaire Barry Rosenstein, also made a sizable purchase of Teva over the same period. Rosenstein bought up about 3.5 million shares of the pharmaceuticals company, according to his fund's 13F report. (See more: Jana Partners Bought Facebook, Comcast and Teva.)
13F filings do not present a full picture of the holdings of a hedge fund. Funds typically have other assets which are not included in 13F reports. Because of this, and because of the backward-looking nature of 13F timelines, investors should be cautious when basing investment decisions on this information.