Warren Buffett and 5 Big Investors Betting on HPQ Stock

HP (NYSE:HPQ) is in the spotlight today after Warren Buffett’s Berkshire Hathaway (NYSE:BRK-A, NYSE:BRK-B) disclosed a massive stake. Yesterday, Berkshire reported owning 120.95 million shares of HPQ stock. The most recent purchase occurred yesterday when the fund acquired 4.3 million shares at prices ranging between $34.88 and $35.54. Based on Wednesday’s closing price, Berkshire now owns a $4.2 billion stake in the company. As a result, HPQ stock is up over 15% this morning.

a picture of warren buffett smiling.
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Warren Buffett Discloses HPQ Stock Purchase

Berkshire’s purchase effectively makes it an insider of HP because it now owns an 11.4% stake. The threshold to be defined as an insider is at least a 10% stake. Furthermore, Berkshire is now the largest shareholder of the personal computing company.

In addition, it seems that Buffett plans to hold HP for the long run. This is because Berkshire Hathaway has an average holding period of 28.93 quarters, or a little more than 7 years. If the fund decides to purchase more shares of HP, then it must file a Form 4 to disclose the purchase within two business days. Investors should also note that the shares were purchased through several subsidiaries of Berkshire, such as Berkshire Hathaway Specialty Insurance Company and GEICO Advantage Insurance Company.

The Oracle of Omaha has been on a buying spree this year. Buffett recently purchased a large stake in Occidental Petroleum (NYSE:OXY) and also bought out Alleghany (NYSE:Y) for $11.6 billion.

So, who else is betting big on HP?

Warren Buffett and 5 Investors Betting Big on HP

Tracking institutional ownership is significant, as these large funds provide liquidity and support for stocks. During Q4, 1,073 funds reported owning HPQ stock, an increase of 136 funds from the previous quarter. Additionally, 329 funds increased their existing position during the quarter, while 343 funds reduced their existing position. Meanwhile, the put/call ratio weighs in at 2.85, which means that more funds own put options against the company than call options by a wide margin. This is an indicator of bearish sentiment, especially as the put/call ratio increased in Q4. However, it seems Buffett is anything but bearish.

With that in mind, let’s take a look at the largest shareholders of HP:

  1. Berkshire Hathaway: 120.9 million shares or 11.48% ownership.
  2. Vanguard Group: 111.5 million shares or 10.58% ownership.
  3. BlackRock (NYSE:BLK): 107.9 million shares or 10.24% ownership.
  4. Dodge & Cox: 104.1 million shares or 9.88% ownership.
  5. State Street: 56.8 million shares or 5.40% ownership.
  6. Primecap Management: 25.4 million shares or 2.41% ownership.

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.


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