Warren Buffett’s Berkshire Hathaway (BRK.A) (BRK.B) has been steadily reducing its stake in Bank of America (BAC). Berkshire recently sold an additional 21.1 million shares over the past three consecutive days. Interestingly, Berkshire has divested BAC shares in 21 out of 33 trading sessions since July 17, accumulating $6.2 billion in total proceeds.
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According to regulatory filings, Berkshire’s latest divestment of BAC shares occurred between August 28 and August 30, at average prices ranging from $39.95 to $40.61 each, for a total value of $848.2 million. This follows a similar sale of BAC shares between August 23 and August 27, worth nearly $981.73 million.
Despite these divestments, Bank of America remains Berkshire’s third-largest equity holding, comprising approximately 11% of its portfolio.
Berkshire Sells BAC Stock amid Banking Concerns
The exact reason behind Berkshire’s decision to sell BAC shares remains unclear. However, investors should note that Buffett’s sale came amid growing concerns about the banking sector’s profitability. These concerns are driven by rising expectations that the Federal Reserve might lower interest rates, which could negatively impact bank earnings.
Is BAC a Good Buy Right Now?
BAC has a Moderate Buy consensus rating on TipRanks. This is based on 11 Buy and seven Hold recommendations. Analysts’ average price target on Bank of America stock of $45.59 implies an 11.88% upside potential from current levels. The stock gained 16.63% in the past six months.
