Warren Buffett buys Occidental shares for 9 straight days, pushes his stake to nearly 29%

Warren Buffett’s Berkshire Hathaway has scooped up more shares of Occidental Petroleum over each of the past nine trading sessions, driving his gigantic stake in the Houston-based oil and gas producer to almost 29%, according to regulatory filings.

The Omaha, Nebraska-based conglomerate purchased Occidental shares every trading day from June 5 to Monday, totaling an additional 7.3 million shares with purchase prices slightly under or above $60, filings showed.

The purchases brought Berkshire’s holding to over 255 million shares, representing a 28.8% stake. Occidental is Berkshire’s sixth-biggest stock holding, and the conglomerate has become Occidental’s biggest institutional investor by far.

Berkshire also owns $10 billion of Occidental preferred stock and has warrants to buy another 83.9 million common shares for $5 billion, or $59.62 each. The warrants were obtained as part of the company’s 2019 deal that helped finance Occidental’s purchase of Anadarko Petroleum.

The stock closed at $60.2 Monday, making Buffett’s warrants “in the money.” A full redemption of the preferred equity could lift Berkshire’s ownership of Occidental above 40%.

Buffett has clarified that he wouldn’t take full control of the oil company, once known for being founded by legendary oilman Armand Hammer. There had been speculation of a takeover after Berkshire received regulatory approval to purchase as much as a 50% stake. 

‘Read every word’

The “Oracle of Omaha” previously said he started buying Occidental after reading a transcript of the oil company’s earnings conference call.

“I read every word, and said this is exactly what I would be doing,” Buffett told CNBC.

Occidental CEO Vicki Hollub is “running the company the right way,” he added.

Occidental also pays a 1.5% dividend yield. The stock is about flat this year after dipping 5% in 2023.

The legendary investor said he took advantage of the elevated volatility in the market in early 2022 to acquire 14% of the energy firm, worth more than $7 billion, in just two weeks.

“I find it just incredible. You couldn’t do that with Berkshire. … Overwhelmingly, large companies in America, they became poker chips,” Buffett said in 2022. “Imagine trying to [buy] 14% of the farms in this country; 14% of the apartment houses; 14% of the auto dealerships, or just anything, when already 40% were locked up some other place.”