We recently gave a list of companies which we thought Warren Buffett might want to consider selling or lightening up on after Berkshire Hathaway Inc. (NYSE: BRK-A) disclosed that it had finally decided to lighten up on its giant stake in Moody’s Corp. (NYSE: MCO).  But an interesting question was brought up as a result of this.  Whether Buffett decides to unload stocks or not…. Which Buffett holdings have actually managed to bounce the most from their lows?  With today being month-end, we wanted to run some numbers here.  We already noted yesterday that if and when we see a 1,000 close on the S&P 500 Index it marks a 50% gain from the market lows in March.  There has been a huge bounce in his banking stocks, with Bank of America Corp. (NYSE: BAC) bouncing some 466% from the lows and a 214% bounce in Wells Fargo & Company (NYSE: WFC).

The banks were the worst performing sector out there.  That means they have also bounced the most from his other  (and everyone else’s too) holdings.   So we wanted to look outside of his bank holdings and look to see which of the Buffett holdings have bounced the most from lows.  We kept out the other financial and insurance stocks as well since everything financial was tarred and feathered earlier this year.  But elsewhere, there have been significant bounces in some of his holdings by more than 100%.  That is doubly the case on some of his recent holdings from this year where Buffett has invested higher up in the capital structure.

Carmax Inc. (NYSE: KMX) is a position of 12 million shares and it has seen two straight quarters of decline in his holdings.  Yet the used-car auto seller is now up a whopping 180% from its yearly lows now that the stock is over $16.00.

General Electric Co. (NYSE: GE) scored Buffett as an investor as we covered back on October 1, 2008.  It did a big raise, but sold $3 billion of preferred stock to Warren Buffett’s Berkshire Hathaway Inc. (NYSE: BRK-A).  That was looking like a loser bet in March and it is still way down.  We cannot calculate the 10% preferred rate value of preferred shares with an exact figure because those are private securities, but there has been a 50% bounce in some of the related securities.  Buffett does own GE some 7.77 million shares of common stock as well,  and GE is this afternoon up over 120% from the year lows.

Gannett Inc. (NYSE: GCI) is one of these smaller Buffett positions he owns that we think he could just unload.  But this one has recovered handily despite its troubles.  This stock has recovered over 270% from its year lows.

Ingersoll-Rand (NYSE: IR) is one of the sleeper stocks which Berkshire owns in industrial and commercial products and they hold almost 7.8 million shares of the common stock.  With shares back over $29.00 it has now recovered by a sharp 150% from its yearly lows.

USG Corp. (NYSE: USG) is one you might guess is up huge from the lows because of its sheet rock and home building exposure.   Buffett has plenty of this stock and higher in the capital structure, but we have just over 17 million shares as of its last report date.  With this one up over $14.00 today, this is up a whopping 235% from its yearly lows.

Many of these other Buffett and Berkshire stakes are up 80% and 90%.  You can always see the full list of holdings HERE.   As always, you can join our open email distribution list we send several times per week with new Buffett changes, secondary offerings, IPO’s, mergers, key analyst calls, and other special situations.

JON C. OGG
JULY 31, 2009

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